Posted at 22 September 2021 / Categories Market Roundups
Market Roundup
•Canada Aug New Housing Price Index (MoM) 0.7%,0.4% previous
• US Aug Building Permits (MoM) 6.0% ,2.3% previous
• US Aug Building Permits 1.728M,1.600M forecast, 1.630M previous
• US Aug Housing Starts 1.615M,1.555M forecast, 1.534M previous
• US Aug Housing Starts (MoM) 3.9%,-7.0% previous
• US Current Account (Q2) -190.3B,-191.0B forecast, -195.7B previous
•US Redbook (YoY) 17.1%,15.3% previous
Looking Ahead –Economic Data (GMT)
•01:30 China PBoC Loan Prime Rate 3.85% previous
Looking Ahead - Events, Other Releases (GMT)
• 02:00 Australia RBA Assist Gov Bullock Speaks
• 02:00 Japan BoJ Monetary Policy Statement
• 03:00 Japan BoJ Press Conference
Currency Summaries
EUR/USD: The euro was little changed against dollar on Tuesday as troubles at China Evergrande as growing risks the property giant could default on its massive debt kept investors cautious. As markets stabilised after Monday's selloff, investors remained broadly cautious. The U.S. Federal Reserve's policy decision is coming up on Wednesday, where the bank is expected to open the door to reducing its bond purchases, while tying any actual change to U.S. job growth in September and beyond. The euro traded at $1.1726 , after having touched a near-one-month low of $1.1700 Immediate resistance can be seen at 1.1742 (50%fib), an upside break can trigger rise towards 1.1776(61.8%fib).On the downside, immediate support is seen at 1.1703(38.2%fib), a break below could take the pair towards 1.1660 (23.6%fib).
GBP/USD: Sterling held near four-week lows on Tuesday as investors evaluated the direction the Bank of England would take at an upcoming policy meeting, while broader risk sentiment remained under pressure due to Chinese property company Evergrande’s debt troubles. In an important week for monetary policy, the Federal Reserve and BoE are among a dozen central banks hosting their meetings, which kept major currencies confined to their ranges. The pound gained 0.2% to $1.3680, edging up marginally from previous day’s low of $1.364 its weakest level since Aug. 23 . Immediate resistance can be seen at 1.3691 (Daily high), an upside break can trigger rise towards 1.3707 (23.6%fib).On the downside, immediate support is seen at 1.3647 (38.2%fib), a break below could take the pair towards 1.3600 (50%fib).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Tuesday as oil prices rose and the re-election of Prime Minister Justin Trudeau’s Liberals kept the door open to more fiscal spending.Trudeau acknowledged he will need to work with other parties after he fell short of winning a majority in parliamentary elections on Monday, leaving him once more dependent on opposition legislators to govern. On Monday, the loonie hit its weakest intraday level in one month at 1.2895 as troubles at property group China Evergrande roiled global financial markets. Immediate resistance can be seen at 1.2825 (Higher Bollinger Band), an upside break can trigger rise towards 1.2885(23.6%fib).On the downside, immediate support is seen at 1.2774 (38.2%fib), a break below could take the pair towards 1.2778 (5DMA).
USD/JPY: The dollar declined against yen on Tuesday as investors sought safety in the yen as potential default by property developer China Evergrande raised concerns. Default fears continued to stalk China Evergrande Group despite efforts by its chairman to lift confidence in the embattled property company. Financial markets looked for possible intervention by Beijing to stem any domino effects across the global economy. The dollar was trading 0.12% lower versus the dollar at 109.51 after hitting daily high of 109.90. Strong resistance can be seen at 109.50(38.2%fib), an upside break can trigger rise towards 109.91(23.6%fib).On the downside, immediate support is seen at 109.19(50%fib), a break below could take the pair towards 108.86(61.8%fib).
Equities Recap
European shares rose on Tuesday after their biggest fall in two months on easing worries about the spillover from the crisis at China’s Evergrande, while music label Universal Music Group soared 35% in its stock market debut.
The UK's benchmark FTSE 100 closed up by 1.12 percent, Germany's Dax ended up by 1.43 percent, and France’s CAC finished the up by 1.50 percent.
U.S. stock indexes rose on Tuesday as investors weighed the risk of contagion from debt-saddled Chinese developer Evergrande, although gains were capped by concerns the Federal Reserve could signal it was ready to start tapering monetary stimulus.
Dow Jones closed down by 0.16 percent, S&P 500 ended down 0.08 percent, Nasdaq finished the day up by 0.22 percent.
Treasuries Recap
Longer-dated U.S. Treasury yields edged higher on Tuesday after an auction of 20-year bonds was well received and investors waited for the end of this week's Federal Reserve meeting that may shed light on when its massive purchase of government debt will begin to ease.
The yield on the benchmark 10-year Treasury note rose 1.4 basis points to 1.323%, while yields on 20-year Treasuries narrowed, up 0.7 basis points.
Commodities Recap
Gold gained on Tuesday as unease over China’s Evergrande insolvency spurred safe-haven buying, ahead of a Federal Reserve meeting that could provide clues on the central bank’s timeline for cutting its stimulus to the U.S. economy.
Spot gold was up 0.7% at $1,776.09 per ounce by 1:59 p.m. EDT (1759 GMT), while U.S. gold futures settled 0.8% higher at $1,778.20.
Oil prices rose modestly in a see-saw session on Tuesday, as concerns about the global consumption outlook counterbalanced the struggle by big OPEC producers to pump enough supply to meet growing demand.
Both benchmarks were at one point up by $1 per barrel, but Brent crude pared gains and settled just up 44 cents at $74.36 a barrel, after falling by almost 2% on Monday.
The October West Texas Intermediate (WTI) contract , which expired on Tuesday, rose 27 cents to settle at $70.56 a barre.