Market Roundup
- Dutch Aug manufacturing output -1.6 pct m/m after revised -0.4 pct in July
- NewZealand Sept electronic card retail sales +0.9% m/m, +6.1% y/y, Aug +0.5%, +1.0%.
- Australia Aug owner-occupied housing finance +2.9% m/m, +5.0% eyed, investment housing finance -0.4%.
- U.S. crude rises to above $50 a barrel, gains more than $1 to $50.46 a barrel
- Malaysia ringgit spiked 3.3 pct to 4.1000/dollar, strongest since Aug 20
- Indonesian rupiah jumps 3.2 pct to 13,425/dollar, strongest since July 29
- Moody's says Indian non-banking financial companies' asset quality to stabilize
- Japan FinMin Aso - Global markets volatile, monitoring impact on Asia's economies, promises with China/SoKorea timely macro policies.
- BoJ Gov Kuroda - Tue EM slowdown affecting Japan exports, economy but still optimistic on growth, spending resilient, CAPEX strong, IMF upbeat on China.
- EconMin Amari - Economy trend up despite some weakness.
- Bank of Nova Scotia sells Y47.2 bln in Japan Pro-Bond mkt via NovaScotia, et al.
- SF Fed Williams - Reiterates call for rate hike in '15, decision in September was a close call, labor market tighter, September jobs report not dismal, CNY won't be reserve currency till it freely trades - Reuters.
- Foreign CB US debt holdings week-ended Oct 7 -$5.154 bln to $3.328 trln, Treasuries -$4.580 bln to $3.002 trln, agencies -$501 mln to $281.079 bln.
- NY Fed - Swaps with foreign CBs $143 mln week-ended Oct 7, all with ECB.
- Lipper - US-based stock funds post $8 bln outflows in latest week, taxable bond funds bleed $36.2 bln in Q3.
- BoE Gov Carney - BoE rate hike not Fed-dependent.
- EZ aims to cap Greek debt servicing at 15% of GDP.
- (0245 ET/0645 GMT) France Aug industrial output, +0.5% m/m eyed; last -0.8%.
- (0245 ET/0645 GMT) France Aug budget balance; last E79.8 bln deficit.
- (0400 ET/0800 GMT) Italy Aug industrial output, -0.3% m/m, +1.6% y/y eyed; last +1.1%, +2.7%.
- (0400 ET/0800 GMT) Norway Sep CPI, +0.7% m/m, +2.2% y/y eyed; last -0.1%, +2.0%.
- (0400 ET/0800 GMT) Norway Sep - core, +0.7% m/m, +3.0% y/y eyed; last -0.2%, +2.9%.
- (0400 ET/0800 GMT) Norway Sep PPI; last -10.0% y/y.
- (0430 ET/0830 GMT) UK Aug trade balance, GBP10 bln deficit eyed; last bln deficit.
- (0430 ET/0830 GMT) UK Aug - non-EU, GBP2.5 bln deficit eyed; last bln deficit.
- (0430 ET/0830 GMT) UK Aug construction output, +1.0% m/m, +1.4% y/y eyed; last -1.0%, -0.7%.
- (0830 ET/1230 GMT) US Sep import/export prices, -0.5%, -0.2% m/m eyed; last -1.8%, -1.4%.
- (1000 ET/1400 GMT) US Aug wholesale sales/inventories, -0.3%, unch eyed; last -0.3%, -0.1%.
- N/A UK DMO GBP0.5/2.0/2.0 bln 1/3/6-month treasury bill auctions.
- N/A IMF/World Bank/IIF meetings in Lima (till tom), Peru, G20 presser 1330 GMT.
- (0910 ET/1310 GMT) Atlanta Fed Lockhart speech at New York conference.
- (1330 ET/1730 GMT) Chicago Fed Evans speech in Milwaukee.
FX Recap
AUD/USD: The rally in the Australian and New Zealand dollars came to an abrupt end on Friday, but both currencies are on track to post big weekly gains in two years. AUD/USD grinds higher to extend past 0.7275, post FOMC minutes induced spike. A close above 0.7275 for the Aussie this week will likely open the door for a test of the 0.7350 level. Markets will be keeping a close eye on employment data due on Thursday next week. At 0436 GMT the pair was trading at 0.7278 after hitting highs at to 0.7283. Major resistance for the pair looms in the 0.7280/0.7300 region.
EUR/USD: The bid tone on the EUR strengthens heading to the European open. Could base at 1.1260 to offer support on the downside, but the pair likely to be ensconced in daily Ichi cloud. Range so far 1.1268-92, Ichi cloud parameters 1.1261-1.1302, seen narrowing. Large E768 mln 1.1300 option expirations to help cap, E317 mln more 25-35. E635 mln in option expiries between 1.1210-50, bln 1.1170-1.1200. At the time of writing the pair is trading at 1.1288. Pair will take cues from the broader market sentiment following a data empty European calendar.
GBP/USD: Cable trades above the 1.53 handle, extending gains post the FOMC minutes. the pair is up around 20 pips in the Asian session. Momentum studies climb, 5, 10 & 20 DMAs conflict, 20 day Bolli's contract. Markets will be looking for Aug construction and trade figures due ahead for some reassurance that the momentum of Q3 GDP has not slowed markedly. At the time of writing cable is trading at 1.5369, with immediate resistance at 1.5382 (Daily Kijun) and support at 1.5317 (200 DMA)
USD/JPY: USD/JPY hovers close to the 120 handle, trades a tight range on the day 119.84/120.04. The pair is lacking conviction, losing directional strength on a mixed outlook from the Central Banks while uncertainty remains supportive of the Yen. Upside remains capped beneath 120.36-120.72 cloud. A daily close above the cloud top needed to defer to the upside. Short-term bias is slightly for a bearish resumption. The pair is currently trading at 120.05 with immediate resistance at 120.12 (Daily High Oct 8) and support at 119.62 (Daily Low Oct 8).
Equity Recap
Asian markets saw a positive start to the last trading day of the week boosted by mixed Fed minutes, higher oil and a rally in base metals. Japanese stocks were among the best performers and clinched gains as the strong rebound in oil and metal prices boosted the emerging and mining stocks. Tokyo's Nikkei average unofficially closed up 1.64 pct at 18,438.67
The benchmark Australian S&P/ASX 200 extends its upbeat momentum into a fifth day today, mainly underpinned by the overnight rally oil and gold prices. The index jumps over 1% to 5,263 points.
The Chinese benchmark index, the Shanghai Composite also mirrors gains from its other Asian counterparts and trades 0.31% higher at 3,151. While Hong Kong's Hang Seng rallies 1.57% to 22,712, reversing the previous drop.
Treasury Recap
JGBs trade in tight range as risk-on returns in Asia. Curve flatter, supported by BoJ operations. 10yr yield unchanged at 0.325%; futures up 3 ticks at 148.26, range 148.19/148.28.
Following a negative lead from U.S. Treasuries, New Zealand government bonds and Australian bond futures fell.
Australia's three-year futures contract shed 4 ticks to 98.160, while the 10-year contract lost 6 ticks to 97.2900.
Commodity Recap
Crude futures rose in early Asian trade, with U.S. oil climbing above $50 a barrel. Brent was up 82 cents at $53.87 a barrel at 0459 GMT. U.S. crude was $1 higher at $50.43 a barrel, after climbing 3.4 percent to close at $49.43 a barrel.
Zinc logs biggest single day gain in five years after Commodities giant Glencore said on Friday it will cut 500,000 tonnes of zinc production, or around 4 percent of global supply. London zinc +5.1%, copper +2.2%. Prices of lead which is often mined with zinc also jumped by almost three percent.
Gold edged higher after dropping 0.6 percent overnight. Spot gold was at $1,144.20 an ounce by 0339 GMT, up 0.5 percent from the previous session.
Silver was set for a 3 percent weekly jump while Platinum was on track for a near-6-percent gain for the week, its best weekly performance since July 2013.
