News

America's Roundup: Dollar firms, ECB meeting in focus, Wall Street slips, Gold dips to near one-month low, Oil falls on possibility of Iran exports resuming after Trump fires hardline adviser-September 11th, 2019

Posted at 10 September 2019 / Categories Market Roundups


Market Roundup

• Gold could breach $2,000/oz in the next year or two -Citi

• Investors await ECB policy meeting on Thursday

• Canada Jul Building Permits (MoM)  3.0%,2.3% forecast, -3.1% previous

• US Redbook (MoM)  -0.4%,-1.0% previous

• US Redbook (YoY) 6.4%,6.5% previous

• US Jul JOLTs Job Openings 7.217M, 7.311M forecast, 7.248M previous 

Looking Ahead - Economic Data (GMT)

• 22:45 New Zealand Jul External Migration & Visitors 0.60% previous

• 22:45 New Zealand Jul Permanent/Long-Term Migration 3,100 previous

• 23:50 Japan BSI Large Manufacturing Conditions (Q3) -10.4 previous

• 23:50 New Zealand Visitor Arrivals (MoM) -0.2% previous

• 00:30 Australia  Sep Westpac Consumer Sentiment 3.6% previous

Looking Ahead - Events, Other Releases (GMT)

No significant events

Currency Summaries

EUR/USD: The euro edged lower against the U.S. dollar on Tuesday but held in its tight recent range before the European Central Bank on Thursday is expected to cut interest rates deeper into negative territory and possibly restart asset purchases. Investors are weighing whether further monetary stimulus will be effective in countering economic weakness in the euro zone, and whether the ECB will disappoint dovish expectations baked into the market. The euro was down 0.07 percent at $1.1039. An index that tracks the dollar versus a basket of six major currencies was down 0.30 at 98.30. Immediate resistance can be seen at 1.1043 (21 DMA), an upside break can trigger rise towards 1.1146 (50 DMA).On the downside, immediate support is seen at 1.1000 (Psychological level a break below could take the pair towards 1.0964 (lower BB).

GBP/USD: Sterling was little changed against dollar on Tuesday, as investors kept their hands off the British currency given that the risk of Britain crashing out of the European Union without a divorce deal on Oct. 31 remained high. The probability of a no-deal Brexit was still very much a concern for traders as Prime Minister Boris Johnson reiterated that he will take the country out of the bloc on deadline.Even though the British parliament approved a legislature which forces Johnson to request a deadline extension from Brussels if he cannot agree on a deal with the EU by mid-October, the prime minister said he would not do such a thing. The pound trimmed gains to stand up 0.1% on the day at $1.2342. Immediate resistance can be seen at 1.2384 (Higher BB), an upside break can trigger rise towards 1.2400 (Psychological level).On the downside, immediate support is seen at 1.2314 (5 DMA), a break below could take the pair towards 1.2228 (11 DMA).

USD/CAD: The   Canadian dollar edged higher against its U.S. counterpart on Tuesday, approaching a near six-week high reached the previous day, as oil prices rose and domestic data showed a surprise increase in housing starts. The seasonally adjusted annualized rate of housing starts rose to 226,639 units from a revised 222,467 in July, the Canadian Mortgage and Housing Corporation (CMHC) said. Economists had expected starts to fall to 215,000 units.Separate data from Statistics Canada showed that the valueof Canadian building permits rose by 3.0% in July from June. The Canadian dollar was trading 0.1% higher at 1.3162 to the greenback, or 75.98 U.S. cents. The currency, which on Monday notched its strongest since July 31 at 1.3140, traded in a range of 1.3161 to 1.3191.Immediate resistance can be seen at 1.3189 (5 DMA), an upside break can trigger rise towards 1.3252 (11 DMA).On the downside, immediate support is seen at 1.3135 (Daily low), a break below could take the pair towards 1.3100  (Psychological level).

USD/JPY: The U.S. dollar strengthen against the yen on Tuesday, as demand for the safe-haven currency dropped after a report showed that Bank of Japan policymakers are more open to discussing the possibility of expanding stimulus at their board meeting on Sept. 18-19 as the fallout from the U.S.-China trade war spreads. Demand for the Japanese yen  also dipped as China and the United States on Thursday agreed to hold high-level talks in early October, boosting risk sentiment.Consumer price inflation data on Thursday and retail sales data on Friday are the main economic focus. They will follow a jobs report on Friday that showed U.S.jobs growth slowed more than expected in August.The Federal Reserve is expected to cut rates when it meets on Sept. 17-18. Strong resistance can be seen at 107.58 (Higher BB), an upside break can trigger rise towards 108.00 (Psychological level).On the downside, immediate support is seen at 106.98 (5 DMA), a break below could take the pair towards 106 .48 (11 DMA).

Equities Recap

A rally in banking shares and other recently battered sectors such as oil and gas and automakers kept the mood buoyant in European stock markets on Tuesday, as investors speculated over policy measures by the European Central Bank later this week.

The UK's benchmark FTSE 100 closed up by 0.44 percent, Germany's Dax ended up by 0.35 percent, and France’s CAC finished the the day down by 0.08 percent.

U.S. stocks fell in morning trading on Tuesday as weak economic data from China added to fears of a global recession and pushed investors out of riskier technology stocks.

Dow Jones closed up by 0.06 percent, S&P 500 ended down 0.19 percent, Nasdaq finished the day down by 0.26  percent.

Treasuries Recap

U.S. Treasury yields climbed to fresh three-week peaks on Tuesday, tracking German bonds, as risk appetite continued to improve amid diminishing U.S.-China trade tensions and expectations of fiscal stimulus measures from Germany, Europe's largest economy.

The U.S. benchmark 10-year note yields rose to 1.643% from 1.622% late on Monday. Early in the session, 10-year yields hit a three-week high of 1.658%. Since the beginning of the year, however, 10-year yields have fallen more than 100 basis points.

Commodities Recap

Gold prices fell to their lowest level in nearly a month on Tuesday, as rising bond yields and the dollar dented the allure of safe-haven assets.

Spot gold was down 0.4% at $1,492.20 per ounce as of 1:44 p.m. EDT (1744 GMT), having earlier hit its lowest level since Aug. 13, at $1,486. U.S. gold futures settled 0.8% lower at $1,499.20 per ounce.

Oil prices edged lower on Tuesday after U.S. President Donald Trump fired national security adviser John Bolton, the chief architect of Trump’s strident stance against Iran, raising speculation of a return of Iranian crude exports to the market.

Brent  settled at $62.38 a barrel, shedding 21 cents, while U.S. West Texas Intermediate (WTI) futures   finished 45 cents, or 0.8%, lower at $57.40 a barrel.


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