Market Roundup
•French Consumer Confidence (Sep) 95 92 forecast, 93 previous
Looking Ahead Economic Data(GMT)
•12:30 US Building Permits (Aug) 1.475M forecast, 1.406M previous
•12:30 US Building Permits (MoM) (Aug) 4.9% forecast, -3.3% previous
•14:00 US New Home Sales (Aug) 699K forecast, 739K previous
•14:00 US New Home Sales (MoM) (Aug) 10.6% previous
•14:30 US Crude Oil Inventories -1.300M forecast, -1.630M previous
•14:30 US Crude Oil Imports -1.829M previous
Looking Ahead Events And Other Releases(GMT)
•12:30 ECB McCaul Speaks
EUR/USD: The euro strengthened against the dollar on Wednesday, bolstered by weak U.S. macroeconomic data that heightened expectations for a significant interest rate cut at the Federal Reserve's upcoming meeting. U.S. consumer confidence plummeted in September, marking its largest drop in three years due to growing concerns about the labor market, although more households indicated plans to purchase homes in the next six months. The Conference Board's consumer confidence index fell to 98.7 from an upwardly revised 105.6 in August, the steepest decline since August 2021. The euro rose 0.06% to $1.1187, inching closer to a 13-month high of $1.1201 reached in August. Immediate resistance is noted at 1.1198 (23.6%fib), with a breakout potentially pushing the pair towards 1.1218 (Higher BB). On the downside, immediate support is at 1.1111 (38.2%fib), a drop below this level could lead the pair towards 1.1049(50%fib).
GBP/USD: The pound edged lower against the dollar on Wednesday, pulling back from a two-and-a-half-year high reached the day before, as investors shifted their attention to next month's British budget and the Bank of England's upcoming interest rate decision. Uncertainty regarding the policy direction of the newly elected Labour government may be impacting business investment and consumer spending, according to Bank of England Monetary Policy Committee member Megan Greene. Finance Minister Rachel Reeves indicated that some taxes are likely to rise in her first budget set for October 30. Sterling fell 0.30% to $1.33725, breaking a five-day streak of gains. Immediate resistance can be seen at 1.3417(23.6%fib), an upside break can trigger rise towards 1.3449(Higher BB).On the downside, immediate support is seen at 1.3335(38.2%fib), a break below could take the pair towards 1.3274(50%fib).
AUD/USD: The Australian dollar trimmed some of its gains on Wednesday following data showing that domestic consumer prices slowed to a three-year low in August. Consumer price inflation fell to 2.7%, down from 3.5% in July, largely due to government rebates on electricity. Core inflation also reached its lowest level since early 2022, suggesting positive progress that could pave the way for potential rate cuts, data from the Australian Bureau of Statistics was in line with market expectations.. The Australian dollar still came off its 1-1/2-year high and was last flat at $0.6891. Immediate resistance can be seen at 0.6902(23.6%fib), an upside break can trigger rise towards 0.6927(Higher BB).On the downside, immediate support is seen at 0.6836(38.2%fib), a break below could take the pair towards 0.6814(Sep 24th low).
USD/JPY: The dollar dipped against the yen on Wednesday as it weakened following data showing a decline in U.S. consumer confidence for September. The Conference Board's consumer confidence index fell to 98.7, down from an upwardly revised 105.6 in August, marking the largest drop since August 2021. Last week, the Federal Reserve cut interest rates by 50 basis points to a range of 4.75%-5.00%, the first reduction since 2020, aimed at sustaining low unemployment. Traders are now awaiting Fed Chair Jerome Powell's remarks on Thursday and U.S. inflation data on Friday for further policy insights, with the current jobless rate at 4.2%.Strong resistance can be seen at 144.73 (38.2%fib), an upside break can trigger rise towards 145.00 (psychological level). On the downside, immediate support is seen at 141.70(23.6%fib), a break below could take the pair towards 140.36(Lower BB).
Equities Recap
European shares trimmed some losses on Wednesday, buoyed by a rise in basic resources, despite signs of a slowdown in the rally initially sparked by China's stimulus package.
UK's benchmark FTSE 100 was up by 0.26 percent, Germany's Dax was down by 0.18percent, France’s CAC finished the was down by 0.17 percent.
Commodities Recap
Gold remained stable after reaching an all-time high on Wednesday, driven by expectations of another significant U.S. rate cut, as attention turned to Fed Chair Jerome Powell's upcoming comments and U.S. inflation data later this week.
Spot gold was steady at $2,655.35 per ounce by 1059 GMT, after hitting an all-time high of $2,670.43 earlier.U.S. gold futures gained 0.1% to $2,679.60.
Oil prices fell on Wednesday as investors revaluated the effectiveness of China's recent stimulus plans in boosting its economy and increasing fuel demand from the largest crude importer.
Brent crude futures were down 58 cents, or 0.77%, at $74.49 a barrel at 1030 GMT. U.S. West Texas Intermediate crude was down 60 cents, or 0.84%, at $70.96 per barrel.
