Market Roundup
- Aussie rises after Aussie Home Loans data
- Kiwi near 3-week high
- Euro consolidates ahead of ECB meeting
- Oil rises as Saudi Arabia signals OPEC cuts
Economic Data Ahead
- (0430 ET/0830 GMT) Great Britain Industrial Output MM
- (0430 ET/0830 GMT) Great Britain Industrial Output YY
- (0430 ET/0830 GMT) Great Britain Manufacturing Output MM
- (0430 ET/0830 GMT) Great Britain Manufacturing Output YY
- (0430 ET/0830 GMT) Great Britain Goods Trade Bal. Non-EU
- (0430 ET/0830 GMT) Great Britain Goods Trade Balance GBP
- (0430 ET/0830 GMT) Great Britain gross domestic product
- (0430 ET/0830 GMT) EZ Sentix investor confidence September
Key Events Ahead
- (0400 ET/0800 GMT) Bank of England Monetary Policy Committee member Dr Gertjan Vlieghe gives a speech
FX Beat
DXY: The dollar index rose, halting a 4-day losing streak, after Fed Chair Jerome Powell, on Friday, stated that the Federal Reserve will continue to act as appropriate to sustain the economic expansion in the U.S. economy. The greenback against a basket of currencies traded 0.4 percent up at 98.43, having touched a low of 98.01 on Friday, its lowest since August 28.
EUR/USD: The euro consolidated within narrow ranges as investors remained cautious ahead of a European Central Bank meeting later this week at which policymakers are expected to deliver new stimulus to bolster a flagging regional economy. The European currency traded flat at 1.1037, having touched a high of 1.1084 on Thursday, its highest since August 29. Investors’ attention will remain on a series of data from the Eurozone economies, and EZ Sentix investor sentiment, ahead of the U.S. consumer credit change. Immediate resistance is located at 1.1060 (August 30 High), a break above targets 1.1116 (August 27 High). On the downside, support is seen at 1.1000, a break below could drag it below 1.0963 (August 30 High).
USD/JPY: The dollar eased, hovering away from a 1-month peak hit last week on the back of mixed U.S. August payrolls data. On Friday, the government said U.S. employers added fewer workers than expected in August, with retail hiring declining for a seventh straight month, but average hourly wages grew a bit more strongly than forecast, supporting consumer spending. The major was trading 0.05 percent down at 106.85, having hit a high of 107.23 on Thursday, its highest since August 2. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. consumer credit change. Immediate resistance is located at 107.56 (August 2 High), a break above targets 108.00. On the downside, support is seen at 106.46 (5-DMA), a break below could take it lower at 105.73 (September 3 Low).
GBP/USD: Sterling declined, extending previous session losses, weighed down by political uncertainty about how the UK would complete its transition deal with the European Union by an October 31 deadline. The major traded 0.2 percent down at 1.2263, having hit a high of 1.2353 on Thursday, it’s highest since July 29. Investors’ attention will remain on the development surrounding Brexit, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2309 (July 29 High), a break above could take it near 1.2383 (August 27 High). On the downside, support is seen at 1.2205 (10-DMA), a break below targets 1.2139 (August 30 Low). Against the euro, the pound was trading 0.3 percent down at 89.89 pence, having hit a high of 89.41 on Friday, it’s highest since July 25.
AUD/USD: The Australian dollar surged to a fresh 1-month peak after domestic data showed the home loans rose by 5 percent in July, having dropped 0.8 percent in the preceding month. The Aussie trades 0.2 percent up at 0.6856, having hit a high of 0.6862 earlier, it’s highest since August 1. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.6786 (5-DMA), a break below targets 0.6717 (August 29 Low). On the upside, resistance is located at 0.6867 (August 1 High), a break above could take it near 0.6899 (July 31 High).
NZD/USD: The New Zealand dollar rose, extending gains for the sixth straight session, as expectations of the U.S.-China trade negotiations in October, coupled with a late-September U.S. visit by Chinese deputies boosted investor risk sentiment. The Kiwi trades 0.2 percent up at 0.6390, having touched a high of 0.6395 on Thursday, its highest level since August 27. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6409 (August 23 High), a break above could take it near 0.6441 (August 19 High). On the downside, support is seen at 0.6337 (5-DMA), a break below could drag it below 0.6269 (September 3 Low).
Equities Recap
Asian shares gained amid cautious sentiment as investors pinned their hopes on expected global stimulus to support slowing growth in the world’s major economies.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.2 percent.
Tokyo's Nikkei rallied 0.6 percent to 21,318.42 points, Australia's S&P/ASX 200 index gained 0.05 percent to 6,648.00 points and South Korea's KOSPI surged 0.5 percent to 2,019.52 points.
Shanghai composite index rose 0.7 percent to 3,020.39 points, while CSI 300 index traded 0.5 percent up at 3,967.77 points.
Hong Kong’s Hang Seng traded 0.1 percent lower at 26,676.59 points. Taiwan shares added 0.2 percent to 10,801.14 points.
Commodities Recap
Crude oil prices surged on expectations that Saudi Arabia will continue to support output cuts by OPEC and other producers to prop up prices under new Energy Minister Prince Abdulaziz bin Salman. International benchmark Brent crude was trading 0.9 percent higher at $62.12 per barrel by 0517 GMT, having hit a high of $62.37 on Thursday, its highest since August 2. U.S. West Texas Intermediate was trading 0.9 percent up at $57.15 a barrel, after rising as high as $57.72 on Thursday, its highest since August 1.
Gold prices steadied after falling nearly 1 percent in the previous session, on expectations of monetary policy easing by the world’s major economies amid soft economic data, although a rise in equities limited gains. Spot gold was trading 0.2 percent up at $1,509.63 per ounce by 0522 GMT, having touched a low of $1,502.46 on Friday, its lowest since August 23. U.S. gold futures were up 0.2 percent at $1,518.5 an ounce.
Treasuries Recap
The Japanese government bonds gained at close of morning Asian session after the country’s gross domestic product (GDP) for the second quarter of this year expanded less than that in the previous quarter amid hovering uncertainties over U.S.-China trade talks. At close, the yield on the benchmark 10-year JGB note, which moves inversely to its price, plunged 25 basis points to -0.254 percent, the yield on the long-term 30-year hovered around 0.198 percent and the yield on short-term 2-year slumped 31 basis points to -0.312 percent.
