Market Roundup
• French 12-Month BTF Auction: 2.714%,2.789% previous
• French 3-Month BTF Auction: 3.250%,3.367% previous
• French 6-Month BTF Auction: 3.028% ,3.116% previous
• US Chicago PMI (Sep): 46.6,46.1, 46.1 previous
•US Dallas Fed Mfg Business Index (Sep): -9.0,-4.5, -9.7 previous
•US 3-Month Bill Auction: 4.500%,4.540% previous
•US 6-Month Bill Auction: 4.215%,4.270% previous
Looking Ahead Economic Data(GMT)
•23:30 Japan Jobs/applications ratio (Aug) 1.24 forecast, 1.24 previous
•23:30 Japan Unemployment Rate (Aug) 2.6% forecast, 2.7% previous
•01:30 Australia Building Approvals (YoY) (Aug) 24.90% previous
•01:30 Australia Building Approvals (MoM) (Aug) -4.3% forecast, 10.4% previous
•01:30 Australia Private House Approvals (Aug) 0.6% previous
•01:30 Australia Retail Sales (MoM) (Aug) 0.4% forecast, 0.0% previous
Looking Ahead Events And Other Releases(GMT)
•No Events Ahead
Currency Summaries
EUR/USD: The euro eased against the dollar on Monday as the Federal Reserve Chair Jerome Powell dampened hopes for another big rate cut. Powell said recent revisions to data on economic growth, savings rates and personal income had removed some "downside risks" the Fed has been focused on. He also said that he sees two more interest rate cuts, totaling 50 basis points, this year as abaseline if the economy performs as expected, and warned that it will likely take several years before housing services inflation cools to desirable levels.The euro was down 0.27% at $1.1133. Immediate resistance is noted at 1.1191 (23.6%fib), with a breakout potentially pushing the pair towards 1.1216 (Higher BB). On the downside, immediate support is at 1.1114 (38.2%fib), a drop below this level could lead the pair towards 1.1072 (Sep 19th low).
GBP/USD: Sterling edged higher on Monday as expectations that the Bank of England will be relatively cautious in cutting interest rates compared to the Federal Reserve and European Central Bank boosted sterling . The BoE kept rates on hold in September, after cutting in August, and markets are only fully pricing one further 25 basis- point rate cut by year end.In contrast, the ECB has cut rates twice this cycle, and analysts expect two more 25 bp cuts by December, while markets are pricing round 70 bps of further cuts across the Fed's remaining two meetings, after September's large 50 bp move. Sterling was up 0.2% on the dollar at $1.3379. Immediate resistance can be seen at 1.3417(23.6%fib), an upside break can trigger rise towards 1.3449(Higher BB).On the downside, immediate support is seen at 1.3335(38.2%fib), a break below could take the pair towards 1.3274(50%fib).
USD/CAD: The Canadian dollar slipped slightly against the U.S. dollar on Monday as Federal Reserve Chair Jerome Powell tempered expectations for another significant interest rate cut. Nevertheless, the loonie held onto most of its gains from the previous quarter. Meanwhile, the U.S. dollar strengthened against a range of key currencies, and U.S. bond yields climbed after Powell indicated that Fed policy is not on a definitive course and that risks remain balanced. Investors are now forecasting a 65% chance of a quarter-point cut in November, rather than a repeat of the half-point move earlier this month. The loonie was trading 0.1% lower at 1.3530 to the U.S. dollar.Immediate resistance can be seen at 1.3552(50%fib), an upside break can trigger rise towards 1.3585(Sep 23rd high).On the downside, immediate support is seen at 1.3490(38.2%fib), a break below could take the pair towards 1.34533 (lower BB).
USD/JPY: The dollar strengthened against the yen on Monday after comments by Fed Chair Jerome Powell on the state of the U.S. economy. In his speech, Powell said the U.S. economy seems poised for a continued slowdown in inflation, that the U.S. job market remains solid, that the risks are two-sided and that the central bank does not feel like it is in a hurry to cut quickly.Powell's speech comes before a heavy week of U.S. data including the Institute for Supply Management’s manufacturing index on Tuesday and non-manufacturing report on Thursday, as well as job openings data on Tuesday and Friday’s closely watched employment report for September. The greenback gained 1.17% to 143.85 Japanese yen .Strong resistance can be seen at 143.81 (38.2%fib), an upside break can trigger rise towards 144.00 (psychological level). On the downside, immediate support is seen at 142.13(23.6%fib), a break below could take the pair towards 141.74(Oct 1st low ).
Equities Recap
Europe's STOXX 600 fell on Monday, with automakers leading the way after industry titans Stellantis and Volkswagen issued profit warnings. Despite this, the benchmark showed improvements for both the quarter and month.
UK's benchmark FTSE 100 closed down by 1.01 percent, Germany's Dax ended down by 0.76 percent, France’s CAC finished the day down by 2.00 percent.
The Dow Jones Industrial Average and S&P 500 closed lower on Wednesday, pulling back from recent record highs driven by China's extensive stimulus package, as investors awaited economic indicators and clues about potential interest rate cuts.
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Dow Jones closed up by 0.04% percent, S&P 500 closed up by 0.42% percent, Nasdaq settled up by 0.36% percent.
Treasuries Recap
The yield on benchmark U.S. 10-year notes rose 3.6 basis points to 3.785%, from 3.749% late on Friday.
The 2-year note yield, which typically moves in step with interest rate expectations, rose 7.4 basis points to 3.637%, from 3.563% late on Friday.
Commodities Recap
Gold eased on Monday, taking a breather after a historic rally driven by U.S. monetary easing and heightened Middle East tensions, which put it on course for its best quarter since 2020.
Spot gold was down 0.9% at $2,634.75 per ounce as of 02:08 p.m. ET (1808 GMT).U.S. gold futures settled 0.3% lower at $2,659.40.
Oil prices were little changed on Monday, but posted a 17% loss for the third quarter as fears that a widening conflict in the Middle East could curtail crude supply were overshadowed by waning global demand concerns.
Brent crude futures for November delivery, which expired on Monday, fell 21 cents to settle at $71.77 a barrel. Meanwhile, the more actively traded Brent contract for December delivery gained 27 cents to $71.81.
