- DXY up 0.2% to 96.324 on the day ahead of US jobs report.
- EUR/USD on track for third straight week of losses, worst run in 8 months.
- EUR/USD plays in between 1.1158/1.1204. 1.1135-1.1282 this week.
- Sterling rises on upbeat construction report.
- GBP/USD rose to test 1.5174, pulling away from 5 month lows.
- European shares rise, DAX up 1.54%.
- WTI 0.98% Brent flat. NOK & Rub softer despite WTI gain.
- UK September Markit/CIPS Construction PMI 59.9 vs previous 57.3. 57.5 expected.
- EZ August Producer prices -0.8% m/m, -2.6% y/y vs previous -0.1%/-2.1%. -0.6%/-02.4% expected.
- Norway September registered unemployment 2.9% vs expected 2.9% - labour agency.
- Nelson in Telegraph-Osborne's great EU gamble is not such a safe bet.
- Spain's parliamentary elections will be held on Dec 20, PM Rajoy said Thursday.
- (0800 ET/1200 GMT) Brazil Industrial Output.
- (0830 ET/1230 GMT) US September non-farm payrolls, +203k eyed; last +173k.
- (0830 ET/1230 GMT) US September unemployment, 5.1% eyed; last 5.1%, 62.6% participation.
- (0830 ET/1230 GMT) US September average earnings, +0.2% m/m, 34.6 hrs eyed; last +0.3%, 34.6.
- (0900 ET/1300 GMT) Mexico's gross fixed investment.
- (0945 ET/1345 GMT) US September ISM-New York index; last 700.2.
- (1000 ET/1400 GMT) US August factory orders, -1.2% m/m eyed; last +0.4%, -0.6% ex-transport.
Key Events Ahead
- (0800 ET/1200 GMT) US TsySec Lew speech in Washington, DC.
- (0845 ET/1245 GMT) Philly Fed Harker speech at Philly Fed conference.
- (1230 ET/1630 GMT) St Louis Fed Bullard speech in New York.
- (1330 ET/1730 GMT) Fed reserve Vice Chair Stanley Fischer Speech in Boston.
FX Recap
USD: The dollar inched higher ahead of U.S. employment report that may Strengthen expectations the U.S. Fed will hike interest rates this year. The dollar index was up 0.2 pct at 96.287. The euro fell 0.3 percent to $1.1160.
EUR/USD: Pair was trading weaker on the day and was seen around $1.1150 and at daily lows. Gains for European and Asia stocks capped a wild week for financial markets on Friday, ahead of a key U.S. jobs report that could determine the chances of the Federal Reserve raising interest rates before year-end. The main focus for the day, US Nonfarm Payroll report for September is expected to show that the country added a bit above 200K new jobs in the month, whilst the unemployment rate is expected to hold steady at 5.1%. It made intraday high at 1.1203 and low at 1.1150 levels. Initial support is seen around at 1.1015 and resistance at 1.1560 levels. Option expiries are at 1.1100 (1.6BLN), 1.1175 (434M), 1.1200 (627M), 1.1250 (581M).
USD/JPY: Japanese household spending picked up at a solid rate in August, while the jobless rate remained close to its lowest ever, signalling the economy may be starting to head down the path policymakers have been hoping for. Household spending rose 2.9% year-on-year in August, according to Japan's Statistics Bureau, coming in much stronger than the market forecast of a 0.4% increase. This follows declines of 0.2% in July and 2.0% in June. Further data released by the Statistics Bureau on Friday showed the unemployment rate rising from 3.3% in July - an historic low for Japan - to 3.4% in August. Pair is supported above 120.00 levels. Pair made intraday high at 120.24 and low at 119.78 levels. Initial resistance is seen at 123.20 and support is seen at 118.42 levels. Option expiries are at 1.1945-50 (420M), 120.70 (505M), 121.00 (722M).
GBP/USD: Sterling edged higher from recent 5-month lows against the dollar, after the data showed U.K. construction picked up pace in September. The CIPS/Markit construction Purchasing Managers' Index rose to 59.9 in September, its strongest level since February, up from 57.3 in August. The pair rose to $1.5174, up 0.3 pct on the day, having traded at $1.5148 before the data. The euro fell to 73.625 pence, down 0.5 pct on the day. The performance in the UK construction sector improved further at the end of the third quarter as job creation increased to a three-month high and residential building surged the most in twelve months, a survey showed on Friday. Pair made intraday high at 1.5172 and low at 1.5126 levels. Initial support is seen at 1.5107 and resistance is seen around 1.5725 levels.
NZD/USD: Today ANZ Commodity Price Index rose for the first time since March, increasing by 5.5% in September. Dairy and aluminium drove the increase in the overall index, while falls were seen across the remaining four major commodity groups. Market will focus on US macroeconomic data for the further movement. Pair is supported around 0.6400 levels. It made intraday high at 0.6420 and low at 0.6383 levels. Initial support is seen at 0.6195 and resistance at 0.6511 levels.
AUD/USD: Australian retail sales picked up again in August after declining in July, yet consumers continue to display signs of cautiousness amid precarious economic settings. Retail sales rose a seasonally-adjusted 0.4% month-on-month in August after falling 0.1% in July, according to the Australian Bureau of Statistics, coming in as forecast by analysts. Pair made intraday low at 0.7011 levels and high around 0.7055 levels. Initial support is seen at 0.6908 and resistance at 0.7245 levels.
Equities Recap
Gains for European and Asia stocks capped a wild week for financial markets on Friday, ahead of a key U.S. jobs report that could determine the chances of interest rate hike from Fed before year end.
The pan-European FTSEurofirst300 was up 0.8 percent, Germany's DAX rose 1 pct France CAC 40 futures climbed 1.1 pct in early trades.
Japan's Nikkei Average fell 0.4 percent. MSCI's broadest index of Asia-Pacific shares outside Japan jumped 0.3 percent, and was on track for a weekly gain of 1.2 percent after posting its poorest quarterly performance since 2011 with a decline of 17 percent. Chinese markets are shut for a week-long holiday with India also closed on Friday.
Commodities Recap
Oil rose on Friday, global benchmark Brent earned 47 cents to $48.16 a barrel by noon. U.S. crude gained 74 cents at $45.48 a barrel, after settling 35 cents lower in the previous session.
Gold fell to 2-week lows, heading for its biggest weekly loss since early March ahead of U.S. payrolls data.Spot gold fell 0.6 percent at $1,107.00 an ounce at noon, while U.S. gold futures for December delivery were down $7.40 an ounce at $1,106.50.
Treasuries Recap
German Bund futures were little changed on Friday.
JGB prices closed the day slightly higher in the 7-yr and longer zone, sending yields down by 1bp to 2bp on the day in the 10-yr and longer zone. Long-term and super-long JGBs extended their earlier gains, pushing yields down to their late April levels again. (At noon, the 10s turned firmer, briefly sending yields down from the morning close of 0.33% (+0.5bp) to 0.315% (-1bp), their lowest level since Apr 28 (0.295%), while the 20s extended their earlier gains, sending yields down from the morning close of 1.095% (-1bp) to 1.09% (-1.5bp), their lowest level since Apr 30 (1.09%)).
Dec UK Gilts opened 13 ticks down, in line with other European bond markets, and have fell further with the 10yr cash Gilt now underperforming core bonds by 0.5bp.
New Zealand government bonds had a soft tone, sending yield one basis points higher on the longer end of the curve. Australian government bond futures were quiet, with the 3-year bond contract up one tick at 98.210. The 10-year contract was half a tick lower at 97.3700.
Australian government bond futures rose, with the 3-year bond contract up 2 ticks at 98.220. The 10-year contract added 2.5 ticks to 97.3750.
