Market Roundup
• US Existing Home Sales Jul, 5.44 mln, 5.57 mln forecast, 5.52 mln previous.
• US Exit. Home Sales % chg Jul, -1.3%, 0.9% forecast, -1.8% previous.
• US Initial Jobless Claims w/e, 234K, 238K forecast, 232K previous.
• US Continued Jobless Claims w/e, 1.954 mln, 1.950 mln forecast, 1.954 mln previous.
• KC Fed Mfg Aug, 22, 4 previous.
• KC Fed Composite Index Aug, 16, 10 previous.
• Trump blames fellow Republican leaders for debt ceiling 'mess'.
• US Congress will raise the debt ceiling, has many options –Ryan.
• Moody's ties US's top-notch rating to debt payments.
• US steel executives appeal directly to Trump for import restrictions.
• French jobless total nears 1-year high in July.
• Mexican inflation higher than forecast in early August.
Looking Ahead - Economic Data (GMT)
• 23:30 Japan CPI, Core Nationwide YY Jul, 0.5% forecast, 0.4% previous
• 23:30 Japan CPI, Core Tokyo YY Aug, 0.3% forecast, 0.2% previous
Looking Ahead - Events, Other Releases (GMT)
• 14:00 Yellen speaks on "Financial Stability" in Jackson Hole, US
• 19:00 Luncheon address by ECB’s Draghi in Jackson Hole, US
Currency Summaries
EUR/USD is likely to find support at 1.1740 levels and currently trading at 1.1802 levels. The pair has made session high at 1.1813 and hit lows at 1.1773 levels. Euro was little changed against the dollar in the US session on Thursday as investors cautiously awaited comments on monetary policy from central bankers gathering in Jackson Hole, Wyoming. Speeches from Federal Reserve Chair Janet Yellen and European Central Bank President Mario Draghi on Friday will be scrutinized for hints on the path of monetary policy, but neither of them are expected to give fresh guidance. The central bankers' views will be a departure from the past two weeks, when the stock market was roiled by concerns over geopolitics, mayhem in Washington, and President Donald Trump's controversial comments. Investors have managed to shrug off Trump's earlier comments on Wednesday threatening to shut down the government if funds were not secured to build a Mexico border wall. U.S. officials are expected to weigh raising the debt ceiling by their late-September deadline or risk a default. The dollar has declined 14 percent against the euro this year has come courtesy of a collapse in expectations for tax cuts and other pro-growth moves by the Trump administration that weakens the case for further rises in Fed interest rates.
GBP/USD is supported in the range of 1.2780 levels and currently trading at 1.2801 levels. It reached session high at 1.2830 and dropped to session low at 1.2788 levels. Sterling declined against the dollar on Thursday as the lack of any major economic data encouraged investors to add bearish bets against the British currency.The government is striving to move forward formal discussions on leaving the European Union, with a series of position papers that have outlined potential compromises over key issues. On Wednesday it outlined several escape routes from the "direct jurisdiction" of the European Court of Justice after Brexit, one of Prime Minister Theresa May's key aims in talks to unstitch 40 years of EU membership. Sterling edged back up to $1.2796 after falling to $1.2787 in early trades, its weakest since June 27.On a monthly basis, the pound has fallen nearly 3 percent so far this month and is set for its biggest monthly decline since October. Against the euro, sterling stabilised near a 10-1/2 month low of 92.37 pence hit on Wednesday. Apart from that level, reached during a short-lived overnight "flash crash" in October, that was its weakest in eight years.
USD/CAD is supported at 1.2500 levels and is trading at 1.2526 levels. It has made session high at 1.2540 and lows at 1.2518 levels. The Canadian dollar firmed marginally against the greenback on Thursday and outperformed key currency rivals even as oil prices dipped and the U.S. dollar nudged higher ahead of a meeting of global central bankers. The Canadian dollar has rallied nearly 7 percent this year, helped by a broadly weaker U.S. dollar and upbeat domestic economic data that prompted the Bank of Canada to raise interest rates for the first time in seven years last month. The central bank is expected to raise rates again this fall. The Canadian dollar was trading at C$1.2536 to the greenback, or 79.77 U.S. cents, up 0.1 percent. The currency's strongest level of the session was C$1.2520, while its weakest was C$1.2561.With little domestic news to steer direction until next week's key quarterly GDP report, the Canadian dollar will take direction from external drivers, in particular the annual Jackson Hole, Wyoming, meeting this week. Speeches by U.S. Federal Reserve Chair Janet Yellen and European Central Bank chief Mario Draghi will be parsed for clues on monetary policy direction, even as significant new policy signals were seen as unlikely.
USD/JPY is supported around 109.00 levels and currently trading at 109.58 levels. It peaked to hit session high at 109.60 and made session lows at 109.11 levels. The U.S. dollar strengthened against the Japanese yen on Thursday as investors shifted focus away from government tension in Washington to an upcoming global central bankers' gathering. But the dollar's respite was temporary as investors awaited key speeches from Federal Reserve Chair Janet Yellen and European Central Bank President Mario Draghi at the Jackson Hole Economic Policy Summit in Wyoming. Still, no new policy messages are expected from either official. Stronger-than-expected data on U.S. initial jobless claims also supported the dollar stay positive on the day, but analysts were skeptical those gains could be sustained. Data showed initial claims rose to 234,000 for the week ended Aug 19. In late trading, the dollar rose 0.4 percent to 109.49 yen and 0.1 percent to 93.272 against a major currency basket.
Equities Recap
Gains by cyclical sectors helped push European stocks higher on Thursday while heavy losses in Dixons Carphone after a profit warning dominated trading.
UK's benchmark FTSE 100 closed up by 0.5 percent, the pan-European FTSEurofirst 300 ended the day up by 0.33 percent, Germany's Dax ended up by 0.1 percent, France’s CAC finished the day flat.
U.S. stocks dipped on Thursday as political uncertainty in Washington kept investors cautious ahead of comments on monetary policy from central bankers gathered in Jackson Hole, Wyoming.
Dow Jones closed down by 0.13 percent, S&P 500 ended down 0.21 percent, Nasdaq finished the day down by 0.11 percent.
Treasuries Recap
U.S. Treasury yields edged higher on Thursday as investors waited on central bank speeches in Jackson Hole for fresh indications on monetary policy, while some Treasury bills weakened on concerns about the U.S. debt ceiling.
Benchmark 10-year notes fell 6/32 in price to yield 2.19 percent, up from 2.17 percent on Tuesday.
Commodities Recap
Oil prices fell nearly 3 percent on Thursday amid concerns over demand as U.S. Gulf Coast refineries shut operations as Tropical Storm Harvey was forecast to turn into a major hurricane.
U.S. crude futures dropped $1.27, or 2.6 percent, to $47.14 a barrel and Brent crude fell 89 cents a barrel, or 1.7 percent, to $51.68by 12:48 p.m. (1648 GMT).
Gold prices drifted lower on Thursday, pressured by a firmer dollar as investors awaited cues on further interest rate hikes from central bankers meeting in Jackson Hole this week.
Spot gold was down 0.25 percent at $1,286.5 per ounce by 2:45 p.m. ET (1845 GMT), giving back some of the previous session's gains. The most-active U.S. gold futures for December delivery settled down $2.70 at $1,292 an ounce.
