Market Roundup
- ECB's Nowotny dismisses "currency wars" talk, say ECB cannot count on swift rebound in inflation.
- SNB's Jordan: No need to change policy, will be active in CCY market if need be.
- Greek PM announces to resign to pave way for snap polls.
- Eurogroup's Dijsselbloem: crucial Greece maintains commitments to EZ, hopes Greek elections will lead to even more support for reforms.
- Gold hits 5-week high on lower U.S. Sept rate hike chance.
- Oil slump, Fed inflation worries push euro zone yields lower.
- Global steel output fell 3.8 percent yr/yr in July.
- Copper bounces off 6-year lows on weaker dollar.
- Mexico finance ministry cuts 2015 GDP forecast to 2 to 2.8 percent.
- Brazil's jobless rate rises in July for 7th straight month.
- US Initial Jobless Claims w/e 277k, f/c 272k, 273k-previous.
- US Continued Jobless Claims* w/e 2.254m, f/c 2.265m, 2.278m-previous.
- US Exist. Home Sales % Change Jul 2%, f/c -0.6%, 3.00%-previous.
- US Philly Fed Business Index Aug 8.3, f/c 7, 5.7-previous.
Looking Ahead - Economic Data (GMT)
- No Significant Data
Looking Ahead - Events, Other Releases (GMT)
- No Significant Events
Currency Summaries
EUR/USD is likely to find support at 1.1135 levels and currently trading at 1.1198 levels. The pair has made session high at 1.1220 and hit lows at 1.1181 levels. The dollar fell against the euro on Thursday, as bets dwindled that the Federal Reserve next month will raise U.S. interest rates for the first time in nearly a decade. The euro rose the most among major currencies, gaining more than 1 percent against the dollar to top $1.1200 levels, because of turmoil in emerging market currencies touched off by China's yuan devaluation last week. Traders said the probability of a September increase by the Fed is now around 40 percent, with many investors exiting dollar positions after Wednesday's release of minutes from a Fed policymakers meeting contained nothing definitive about the timing of a rate increase. That was down from a probability of about 50 percent at the end of July. The euro touched $1.1220, its best showing against the dollar since June 30, and was last up 0.75 percent at $1.1194. To the upside, immediate resistance can be seen at 1.1275. To the downside, immediate support level is located at 1. 1182 levels.
GBP/USD is supported in the range of 1.5663 levels and currently trading at 1.5688 levels. It reached session high at 1.5694 and dropped to session low at 1.5665 levels. The Sterling initially fell against the dollar on Thursday, in the European session after data showed British retail sales rose by less than expected in July, hit by a fall in the sales of auto fuels, official data showed on Thursday. Retail sales volumes inched up 0.1 percent on the month to show 4.2 percent growth on the year. Economists had expected retail sales to rise 0.4 percent and for sales to be up 4.4 percent compared with July last year. However, the cable rebounded after hitting lows at 1.5604, the cable slowly inched higher against greenback to hit session high at 1.5699 levels almost gaining 90pips in a single session. Investors reckon the BoE will start hiking rates from their historic lows in early 2016, as the UK economy continues to pick up speed. But, Thursday's Retail Figures will raise lot of doubts in the minds of BOE members about an early hike. To the upside, immediate resistance can be seen at 1.5715. To the downside, immediate support level is located at 1.5660 levels.
USD/JPY is supported around 123.31 levels and currently trading at 123.53 levels. It peaked to hit session high at 123.55 and made session lows at 123.31 levels. The dollar slipped against Japanese's Yen on Thursday, as dovish Feds meeting on Wednesday has weakened the US dollar against Japanese yen, the pair slipped to hit 3-week lows, after failing to break 123.93 daily 38.2 fib retracement level. The dollar was down 0.30 percent against the yen at 123.42 yen. On the data front, U.S. home resales rose to a near 8-1/2-year high in July and factory activity in the mid-Atlantic region picked up this month, fresh signs of steady economic growth that likely keeps the Federal Reserve on track to raise interest rates this year. Initial jobless claims in the week ended August 15 rose 4k to 277k, the highest in six weeks.
USD/CAD is supported at 1.3080 levels and is trading at 1.3088 levels. It has made session high at 1.3130 and lows at 1.3059 levels. The Canadian dollar strengthened marginally against its U.S. counterpart on Thursday, helped in part by a rise in the value of Canadian wholesale trade in June and softening expectations of a Federal Reserve rate hike in September. Wholesale trade rebounded 1.3 percent, more than the 1 percent economists had forecast, following a 0.9 percent decline in May. The figures supported projections that June will be a more robust month for growth in Canada following a lackluster performance for much of the first half of this year. The currency's strongest level of the session was C$1.3076, while its weakest level was C$1.3176. To the upside, immediate resistance can be seen at 1.3110. To the downside, immediate support level is located at 1.3052 levels.
Equities Recap
European stock markets closed lower on Thursday, as the stocks were weighted down by falling oil prices and concerns about Chinese economy. UK's benchmark FTSE 100 closed down by 0.6 percent, the pan-European FTSEurofirst 300 ended the day down by 1.9 percent, Germany's Dax ended down by 2.4 percent, France's CAC finished the day down by 2 percent.
US Stocks ended lower on Thursday, as concern regarding deceleration in the Chinese economy translated into slower global growth.Dow Jones closed down by 2.03 percent, S&P 500 ended down by 2.07 percent, Nasdaq finished the day down by 2.77 percent.
Treasuries Recap
U.S. Treasury yields fell Thursday after minutes from the Federal Reserve's most recent meeting offered no firm indication of how soon the Fed may raise interest rates and reducing expectations of a rate hike next month.
Benchmark 10-year notes were last up 11/32 in price to yield 2.09 percent. The yields have fallen from 2.50 percent in mid-June.
Commodities Recap
U.S. crude prices extended gains and Brent briefly turned higher on Thursday as the first hurricane of the 2015 Atlantic season sparked concern as the front-month September contract approached expiration.
U.S. September crude oil rose 34 cents to settle and go off the board at $41.14 a barrel, after falling to $40.21.
U.S. October crude posted a five-cent gain to settle at $41.32, but turned lower in post-settlement trading. Earlier in the session it fell to $40.50, a contract low.
Brent October crude fell 54 cents to settle at $46.62. It extended losses to a contract low of $46.06 by 4:25 p.m. EDT (2025 GMT) in post-settlement trading.
Gold hit its highest in five weeks on Thursday as the dollar eased after minutes from the U.S. Federal Reserve meeting suggested policymakers were in no hurry to raise interest rates.
Spot gold rose as much as 1.8 percent to $1,154 an ounce, its highest since July 15, and was up 1.7 percent at $1,152.96 at 2:40 p.m. EDT (1840 GMT).
U.S. gold for December delivery settled up 2.2 percent at $1,153.20 an ounce.
