Market Roundup
- Oil prices eases on profit taking
- Gold eases as dollar steadies
- Australia's unemployment rate edges up to 6.9 percent in September
Economic Data Ahead
- (0400 ET/0800 GMT) Italy Industrial Sales s.a. (MoM)(Aug)
- (0400 ET/0800 GMT) Italy Industrial Orders s.a (MoM)(Aug)
- (0400 ET/0800 GMT) Italy Industrial Sales n.s.a. (YoY)(Aug)
- (0400 ET/0800 GMT) Italy Industrial Orders n.s.a (YoY)(Aug)
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index steadied after U.S. Treasury Secretary Steve Mnuchin said he and House of Representatives Speaker Nancy Pelosi were far apart on another coronavirus economic relief package, and that a deal would be hard to reach before the November 3 elections. The greenback against a basket of currencies traded 0.1 percent up at 93.47, having touched a low of 93.01 on Monday, its lowest since September 21.
EUR/USD: The euro rose, retreating from a 1-1/2 week low hit in the prior session, after the European Union agreed to pay more than 1 billion euros ($1.2 billion) to Gilead for a six-month supply of its antiviral drug remdesivir, shortly before the publication of final results of the biggest trial of the COVID-19 medication. The European currency traded 0.1 percent higher at 1.1755, having touched a low of 1.1719 on Wednesday, its lowest since October 5. Investors’ attention will remain on series of economic data from the Eurozone economies, ahead of the U.S. unemployment benefit claims, Philadelphia Fed Manufacturing Survey, import price index, export price index and NY Empire State Manufacturing Index. Immediate resistance is located at 1.1777 (5-DMA), a break above targets 1.1797. On the downside, support is seen at 1.1720, a break below could drag it below 1.1701.
USD/JPY: The dollar surged after tumbling to a near 2-week low in the previous session on rising coronavirus cases and scant progress towards a U.S. stimulus deal. However, expectation that spending happens eventually dented the bid tone around the Japanese yen. The major was trading 0.1 percent up at 105.29, having hit a low of 105.03 on Wednesday, its lowest since October 2. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. unemployment benefit claims, Philadelphia Fed Manufacturing Survey, import price index, export price index and NY Empire State Manufacturing Index. Immediate resistance is located at 105.46, a break above targets 105.72. On the downside, support is seen at 104.84, a break below could take it near at 104.64.
GBP/USD: Sterling eased as the European Union and Britain were set to prolong Brexit talks past a mid-October deadline to try to bridge gaps holding up a new trade agreement. European Union leaders meeting in Brussels on Thursday will pressure Britain for concessions. The major traded 0.1 percent lower at 1.3000, having hit a low of 1.2862 on Wednesday, it’s lowest since October 7. Investors’ attention will remain on the geopolitical developments, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.3049, a break above could take it near 1.3084. On the downside, support is seen at 1.2955 (10-DMA), a break below targets 1.2912. Against the euro, the pound was trading 0.2 percent down at 90.39 pence, having hit a high of 90.07 in the prior session, it’s highest since September 8.
AUD/USD: The Australian dollar slumped to a 1-week low after the central bank chief hinted of a possible rate cut or bond buying. Reserve Bank of Australia Governor Philip Lowe mentioned bond buying and a small rate cut as among options for policy support during the next stages of recovery. Moreover, the selling pressure around the major intensified on data showing Australia’s jobless rate ticked up in September and employment declined, in a sign the economy was still struggling despite massive fiscal and monetary policy stimulus. The Aussie trades 0.6 percent down at 0.7121, having hit a low of 0.7120 earlier, it’s lowest since October 7. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.7190, a break above could take it near 0.7217. On the downside, support is seen at 0.7100, a break below targets 0.7067.
NZD/USD: The New Zealand dollar eased, reversing most of its previous session gains, as the greenback nudged higher amid fading chances of a new U.S. fiscal stimulus package being finalised before the November elections. The Kiwi traded 0.3 percent lower at 0.6636, having touched a high of 0.6682 on Wednesday, its highest level since September 22. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6690, a break above could take it near 0.6720. On the downside, support is seen at 0.6613, a break below could drag it below 0.6587.
Equities Recap
Asian shares plunged amid rising concerns about resurgent COVID-19 infections and after the U.S. Treasury Secretary dashed hopes of a stimulus package before the November 3 election.
MSCI’s broadest index of Asia-Pacific shares outside Japan declined 0.6 percent.
Tokyo's Nikkei declined 0.5 percent to 23,507.23 points, Australia's S&P/ASX 200 index rallied 0.5 percent to 6,210.30 points. South Korea's KOSPI fell 0.7 percent to 2,364.69 points.
Shanghai composite index eased 0.05 percent to 3,339.75 points, while CSI 300 index traded 0.1 percent down at 4,801.24 points.
Hong Kong’s Hang Seng traded 1.3 percent lower at 24,337.08 points. Taiwan shares shed 0.7 percent to 12,827.82 points.
Commodities Recap
Crude oil prices eased after rising by more than 2 percent in the previous session on data showing U.S. crude stockpiles fell last week, while OPEC and its allies were seen complying with their pact to curb output in September. International benchmark Brent crude was trading 0.2 percent down at $43.29 per barrel by 0545 GMT, having hit a high of $43.54 on Friday, its highest since September 18. U.S. West Texas Intermediate was trading 0.2 percent lower at $41.02 a barrel, after rising as high as $41.44 on Friday, its highest since September 18.
Gold prices declined, weighed down by a steady dollar and fading chances of a new U.S. fiscal stimulus package being finalised before the November elections. Spot gold was trading 0.1 percent down at $1,899.65 per ounce by 0549 GMT, having hit a low of $1822.43 on Wednesday, its lowest since October 8. U.S. gold futures were steady at $1,896.60.
Treasuries Recap
The U.S. Treasury yields declined, with the benchmark 10-year note yield trading at 0.709 percent and the 30-year yield at 1.483 percent.
