Market Roundup
- U.S. Senate passes budget blueprint key to Trump tax effort
- Merkel sends positive signal to May on Brexit talks
- Spain to suspend Catalonia's autonomy in response to independence threat
- NZ Prime Minister-elect Ardern focuses on final touches in coalition deal, NZ dlr sinks
- Japan FinMin Aso – Japan Inc piling up of reserves has gone too far
- EconMin Motegi – Voters appreciate government’s economic policies
- Nikkei from red to black following news of GOP draft passage
- Trump concludes Fed chair interviews, could decide next week -source
- White House says rollback of Obamacare must be part of short-term fix
- U.S. muni bond funds post $536.2 mln in inflows-Lipper
- Foreign CB US debt holdings +$4.623 bln to $3.365 trln Oct 18 week
- Treasuries +$4.092 bln to $3.037 trln, agencies +$302 mln to $263.35 bln
Economic Data Ahead
- (0430 ET/0830 GMT) Great Britain Sep PSNB Ex Banks GBP, 6.50 bln eyed; last 5.67 bln
Key Events Ahead
- (0235 ET/0635 GMT) BOJ's Kuroda speaks in Tokyo
- (1930 ET/2330 GMT) Fed's Yellen speaks in Washington
FX Beat
DXY: The dollar rallied across the board after the U.S. Senate approved the Republican-supported budget late on Thursday. The greenback against a basket of currencies traded 0.4 percent up at 93.51, having touched a low of 93.06 in the previous session, its lowest since Oct. 16. FxWirePro's Hourly Dollar Strength Index stood at 90.18 (Slightly Bearish) by 0500 GMT.
EUR/USD: The euro declined as the greenback rallied after the U.S. Senate voted to approve a budget plan that will make the way for Republicans to pursue a tax-cut package without Democratic support. The European currency traded 0.3 percent down at 1.1818, having touched a low of 1.1730 on Wednesday, its lowest since Oct. 9. FxWirePro's Hourly Euro Strength Index stood at 126.14 (Highly Bullish) by 0400 GMT. Investors’ attention will remain on Eurozone current account, ahead of U.S. existing home sales and FOMC member Mester's speech. Immediate resistance is located at 1.1860, a break above targets 1.1880. On the downside, support is seen at 1.1804 (5-DMA), a break below could drag it near 1.1730.
USD/JPY: The dollar rallied to a 2-week high above the 113.00 handle on news that the U.S. Senate has adopted a budget resolution. The major was trading 0.6 percent up at 113.17, having hit a high of 113.30 earlier, its highest since Oct. 6. FxWirePro's Hourly Yen Strength Index stood at -69.32 (Bearish) by 0400 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S existing home sales and FOMC member Mester's speech for further momentum. Immediate resistance is located at 113.240, a break above targets 114.00. On the downside, support is seen at 112.43, a break below could take it near 112.00.
GBP/USD: Sterling fell to an over 1-week low, after data released on Wednesday showed an unexpectedly sharp slowdown in British retail sales adding to doubts over the outlook for Bank of England interest rate moves. The major traded 0.4 percent down at 1.3103, having hit a low of 1.3099 earlier, its lowest since Oct. 09. FxWirePro's Hourly Sterling Strength Index stood at -91.42 (Neutral) by 0400 GMT. Investors’ focus will remain on UK public sector net borrowing data, ahead of U.S. fundamental drivers. Immediate resistance is located at 1.3197 (10-DMA), a break above could take it near 1.3288 (21-DMA). On the downside, support is seen at 1.3099 (Session Low), a break below targets 1.3050. Against the euro, the pound was trading 0.1 percent down at 90.17 pence, having hit a low of 90.19 pence earlier, its lowest since Oct. 12.
AUD/USD: The Australian dollar slumped, reversing almost all of its previous session gains as the greenback rose after the U.S. Senate approved a budget blueprint for the 2018 fiscal year. The Aussie trades 0.4 percent down at 0.7843, having hit a high of 0.7897 on Friday, it’s highest since Sept. 25. FxWirePro's Hourly Aussie Strength Index stood at 1.96 (Neutral) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7820, a break below targets 0.7800. On the upside, resistance is located at 0.7900, a break above could take it near 0.7948.
NZD/USD: The New Zealand dollar tumbled to a 5-month low below the 0.7000 handle on worries that the new Labour coalition would take a harder stance on immigration and foreign investment than the outgoing centre-right government. The Kiwi trades 0.6 percent down at 0.6987, having touched a low of 0.6971 earlier, its lowest level since May 22. FxWirePro's Hourly Kiwi Strength Index was at -127.75 (Highly Bearish) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.7050, a break above could take it near 0.7080. On the downside, support is seen at 0.6971 (Session Low), a break below could drag it till 0.6950.
Equities Recap
Asian shares traded in a volatile market, while the dollar rallied to a fresh 2-week high against the yen after the U.S. Senate approved a budget blueprint for the 2018 fiscal year.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.3 percent.
Tokyo's Nikkei declined 0.1 percent to 21,430.84 points, Australia's S&P/ASX 200 index gained 0.2 percent to 5,907.00 points and South Korea's KOSPI advanced 0.5 percent to 2,486.08 points.
Shanghai composite index rose 0.1 percent to 3,374.24 points, while CSI300 index was trading 0.2 percent down at 3,922.44 points.
Hong Kong’s Hang Seng was trading 0.9 percent higher at 28,418.79 points. Taiwan shares shed 0.3 percent to 10,728.24 points.
Commodities Recap
Crude oil prices steadied after falling by more than 1 percent in the previous session, as signs of tightening supply and demand fundamentals supported markets. International benchmark Brent crude was trading 0.2 percent up at $57.34 per barrel by 0410 GMT, having hit a high of $58.51 on Wednesday, its highest since Sept. 28. U.S. West Texas Intermediate was trading 0.5 percent lower at $51.60 a barrel, after rising as high as $52.31 on Wednesday, its highest since Sept. 28.
Gold prices declined, reversing most of its previous session gains, as dollar rose after the U.S. Senate voted to approve a budget blueprint that will make the way for Republicans to pursue a tax-cut package without Democratic support. Spot gold was trading 0.4 percent at $1,283.85 an ounce at 0417 GMT, having hit a low of $1,276.57 in the previous session, its lowest since Oct. 9. U.S. gold futures for December delivery edged up 0.1 percent to $1,291.30 per ounce.
Treasuries Recap
The 10-year U.S Treasury yield stood at 2.355 percent higher by 0.035 bps, while 5-year yield was 0.017 bps up at 1.991 percent.
The Australian government bond futures rose, with the three-year bond contract and the 10-year contract up 1 tick each at 97.870 and 97.2200.
The New Zealand government bonds were a tad softer with yields up about half a basis point on the long end of the curve.
The Canadian government bond prices were higher across the yield curve. The two-year rose 5 Canadian cents to yield 1.488 percent, while the 10-year rose 3 Canadian cents to yield 2.013 percent. The 10-year yield touched its lowest since Sept. 8 at 1.977 percent.
