Market Roundup
- Softly, softly for now, British PM May's enforcers gear up for big Brexit vote.
- Change Brexit course or face total surrender - Britain's Boris Johnson.
- Four UK ministers on verge of quitting, EU rejects latest plan.
- Europe may not be happy with Italy's budget response - Deputy PM Salvini.
- Japan PM Abe calls for public works spending plan to help economy.
- Singapore calls for closer S.E. Asia, says multilateralism under threat.
- Saudi Arabia to ship less oil in Dec as it floats cut talks possibility.
- Japan Oct Corp Goods Price (mm), 0.3%, 0.1% forecast, 0.3% previous.
- Japan Oct Corp Goods Price (yy), 2.9%, 2.7% forecast, 3.0% previous.
Economic Data Ahead
- No major economic event scheduled for the day.
Key Events Ahead
- (0400 ET/0900 GMT) Speech by Danièle Nouy, the head of ECB's supervisory board, at the Communicators Conference in Frankfurt, Germany.
- (0500 ET/1000 GMT) Keynote speech by ECB Vice President Luis de Guindos at opening conference of 21st Euro Finance Week in Frankfurt, Germany.
- (0600 ET/1100 GMT) Deputy Governor Martin Flodén will discuss the economic situation and monetary policy at Sparbanken Skåne, Sweden.
- (0630 ET/1130 GMT) Sam Woods, BOE Deputy Governor for Prudential Regulation and CEO of the Prudential Regulation Authority, to moderate a panel at Chatham House Conference in London.
- (0900 ET/1400 GMT) German Finance Minister Olaf Scholz speaks to the foreign press association on a range of issues in Berlin.
- (1030 ET/1530 GMT) ECB bank supervisors Danièle Nouy and Sabine Lautenschläger speak to students in a Youth Dialogue in Frankfurt, Germany.
- (1430 ET/1930 GMT) Federal Reserve Bank of San Francisco President Mary Daly speaks on the economic outlook before the Regional Economic Development for Eastern Idaho at Idaho.
- (1730 ET/2230 GMT) A speech by RBNZ Deputy Governor and Head of Financial Stability Geoff Bascand in Wellington.
FX Recap
USD: The dollar index gained 0.12 percent on Monday, changing hands at 97.02, sitting a little below its 16-month high of 97.2 hit on Oct 31. The dollar index has strengthened four weeks in row, gaining 0.37 percent last week.
EUR/USD: The euro traded at $1.1322 on Monday, down 0.11 percent. The single currency lost ground versus the dollar in the previous three trading sessions as investor confidence weakened due to the standoff over Italy's budget. The European Commission(EU) rejected Italy's 2019 budget last month, saying it flouted a previous commitment to lower the country's deficit. The EU gave Rome until Tuesday to present a revised version of the budget. The EU also cut its forecasts for Italian growth last week, adding to investor concerns over Italy's debts and economic outlook. A consistent close below $1.1335 will drag the parity down towards key supports around $1.1185 and $1.1080 levels respectively. Alternatively, reversal from key support will drag the parity higher towards key resistances around $1.1432, $1.1550, $1.1620, $1.1738 and $1.1852 marks respectively.
USD/JPY: The Japanese yen trades marginally lower in early Asia and jumps above 114.00 mark. Pair was currently trading around 114.01 marks. It made intraday high at 114.03 and low at 113.77 levels. A sustained close above 114.06 is required to take the parity higher towards key resistances around 114.55, 115.25 and 117.98 marks respectively. Alternatively, a daily close below 113.79 will drag the parity down towards key supports around 112.60, 110.98, 110.27, 109.24, 108.72 and 107.90 marks respectively.
GBP/USD: The sterling falls more than 0.5 pct to $1.2901 on Brexit uncertainty. Sterling extended its losses on Friday after Johnson resigned from Prime Minister Theresa May's government over her "delusional" Brexit plans and called for another referendum on Britain's EU membership. The pound's initial drop was slow, as the news came towards the end of the European trading day when liquidity can be tight. It also weakened 0.3 percent to 87.32 pence versus the euro, a session low. A sustained close below $1.2972 requires for dragging the parity down towards key supports around $1.2817, $1.2662 and $1.2498 mark respectively. On the other side, key resistances are seen at $1.3017, $1.3187, $1.3215, $1.3362 and $1.3490 levels respectively.
AUD/USD: The Australian dollar eased again on Monday as concerns about global growth resurfaced, weighing on risk-sensitive assets including equities. The currency was also dragged down by a broadly stronger U.S. dollar after the Federal Reserve last week reaffirmed its plans to raise interest rates in December and beyond. The Australian dollar hit a one-week trough of $0.7211, slipping from Friday's $0.7227. It went as high as $0.7303 on Thursday, a level not seen since late September but it failed to build on those gains. The pair made intraday high at $0.7237 and low at $0.7214 levels. Immediate support and resistance levels were seen at $0.7160 and $0.7303 mark respectively.
NZD/USD: The New Zealand dollar was last at $0.6733, drifting further away from a more than three-month high of $0.6814 touched last week. Major support is down at $0.6424, with resistance around $0.6850. Pair made intraday high at $0.6750 and low at $0.6723 levels. A sustained close above $0.6735 is required to take the parity higher towards $0.6814 and $0.7050 mark respectively. Alternatively reversal from key resistance will take the parity down towards key supports around $0.6402 levels.
Equities Recap
Japan’s Nikkei was trading 0.12 pct higher at 22,280.50 points.
Australia’s S&P/ASX 200 was trading 0.27 pct higher at 5,937.85 points.
Shanghai composite index to open down 0.2 pct at 2,593.20 points and China's CSI300 index to open down 0.2 pct at 3,160.25 points.
Taiwanese stock was trading around 0.30 percent higher at 9,858.93 points.
Hong Kong’s Hang seng was trading 0.26 pct higher at 25,669.55 points.
India’s NSE Nifty was trading around 0.18 percent higher at 10,601.22 points while BSE Sensex was trading 0.10 points higher at 35,189.55 points.
South Korea’s Kospi was trading 0.24 percent lower at 2,081.20 points.
Commodities Recap
Oil prices rose by about one percent on Monday after top exporter Saudi Arabia announced a cut in supply for December, seen as a measure to halt a market slump that had seen crude decline by 20 percent since early October. International benchmark Brent crude oil futures were at $71.11 per barrel at 0051 GMT, up 93 cents, or 1.3 percent from their last close. U.S. West Texas Intermediate (WTI) crude oil futures were at $60.73 per barrel, up 54 cents, or 0.9 percent from their last settlement.
Gold prices were steady on Monday, having dipped to a one-month low in the previous session after the U.S. dollar firmed on the Federal Reserve's plans to gradually keep tightening borrowing costs. Spot gold was little changed at $1,209.57 per ounce at 0121 GMT. On Friday, prices fell to their lowest since Oct. 11 at $1,206.13 per ounce. U.S. gold futures were up 0.3 percent at $1,211.7 per ounce.
Treasuries Recap
New Zealand government bonds were barely changed.
Australian government bond futures gained, with the three-year bond contract up 1.5 ticks at 97.825. The 10-year contract added 3.5 ticks to 97.265.
