Posted at 17 October 2022 / Categories Market Roundups
Market Roundup
•Italian Sep CPI (MoM) 0.3%, 0.3% forecast, 0.8% previous
• Italian Sep CPI (YoY) 8.9%, 8.9% forecast, 8.4% previous
•Italian Sep HICP (YoY) 9.4%, 9.5% forecast, 9.1% previous
• US Oct NY Empire State Manufacturing Index -9.10, -4.00 forecast, -1.50 previous
• Canada New Motor Vehicle Sales (MoM) 136.0%, 135.2% previous
•French 12-Month BTF Auction 2.115%,1.950% previous
•French 3-Month BTF Auction 0.895%, 0.781% previous
•French 6-Month BTF Auction 1.313%,1.191% previous
Looking Ahead - Economic Data (GMT)
•15:30 US 6-Month Bill Auction 4.030%
•15:30 US 3-Month Bill Auction 3.510%
•18:00 US Federal Budget Balance -173.5B forecast, -220.0B previous
Looking Ahead - Events, Other Releases (GMT)
•19:00 EU German Buba President Nagel Speaks
•20:00 Canada BoC Senior Deputy Governor Rogers Speaks
•15:00 EU ECB's Lane Speaks
Fxbeat
EUR/USD: The euro strengthened against dollar on Monday as euro was helped by relief that's Britain new finance minister had quickly shredded virtually all of the unfunded tax cuts that triggered UK market turmoil this month. Britain's new finance minister Jeremy Hunt announced he was reversing "almost all" the tax measures laid out by Prime Minister Liz Truss and his predecessor Kwasi Kwarteng just three weeks ago.Bank of England Governor Andrew Bailey gave Hunt a vote of confidence on Saturday, saying they had an immediate meeting of minds on the need to fix the public finances, where there are estimates of a 70 billion pound ($78.72 billion) black hole. Immediate resistance can be seen at 0.9787(11DMA), an upside break can trigger rise towards 0.9838(38.2%ib).On the downside, immediate support is seen at 0.9718(23.6%fib), a break below could take the pair towards 0.9642 (Oct 13th low).
GBP/USD: The pound rallied on Monday after Britain's new finance minister ditched most of the government's multi-billion pound mini-budget. Sterling rallied by as much as 1.4% after Jeremy Hunt, who Prime Minister Liz Truss appointed on Friday, reversed large swathes of the 45-billion pound "mini-budget" that sparked unprecedented market turmoil in which the pound hit record lows and the Bank of England was forced to intervene.Hunt, who has served as health and culture minister under previous governments, replaced Kwasi Kwarteng, whose package of unfunded tax cuts on Sept. 23 unleashed a bond market sell-off. The pound was last up 1.2% against the dollar at $1.13045 . It's regained almost 10% in value since hitting a record low of $1.0327 after the unveiling of the mini-budget. Immediate resistance can be seen at 1.1373 (38.2%fib), an upside break can trigger rise towards 1.1576 (50%fib).On the downside, immediate support is seen at 1.1213 (11DMA), a break below could take the pair towards 1.1128(23.6%fib).
USD/CHF: The dollar dipped against Swiss franc on Monday as investors brace for further drastic tightening in global financial conditions, with all the risks of recession that brings.Concerns about financial stability added to the corrosive mix with all eyes on UK bonds now that the Bank of England’s (BoE’s) emergency buying spree is over.Prime Minister Liz Truss decision to fire her finance minister might help reassure investors, but her own fate is unclear with media reporting Tory lawmakers will try and replace her this week. At 13:47 GMT, the dollar was 0.86 percent higher versus the Swiss franc at 0.9968. Immediate resistance can be seen at 0.9977 (38.2%fib), an upside break can trigger rise towards 1.0066(23.6%fib).On the downside, immediate support is seen at 0.9962 (9DMA), a break below could take the pair towards 0.9913(38.2%fib).
USD/JPY: The dollar touched fresh 32-year high on the yen on Monday as investors braced for any sign of central bank intervention. Japan last month intervened to buy the yen for the first time since 1998, after the BOJ stuck to its policy of maintaining ultra-low interest rates, which has battered the currency this year.Japanese authorities kept up their warnings to the market on Monday of a firm response to overly rapid yen declines, after last week's fall and meetings of global financial leaders that acknowledged currency volatility. The yen hit a new 32-year low of 148.895 against the dollar on Monday, raising the chances that the Bank of Japan will again step in to shore up the currency. Strong resistance can be seen at 148.97(23.6%fib), an upside break can trigger rise towards 149.45 (Higher BB).On the downside, immediate support is seen at 148.34(Daily low), a break below could take the pair towards 147.44(38.2%fib).
Equities Recap
European stocks rose on Monday as investors awaited clarity on U.K.'s fiscal plan.
At (GMT 14:12),UK's benchmark FTSE 100 was last trading up at 1.32 percent, Germany's Dax was up by 2.09 percent, France’s CAC finished was up by 2.08 percent.
Commodities Recap
Gold prices gained on Monday, helped by a slight pullback in the U.S. dollar and Treasury yields, even as fears lingered about more hefty Federal Reserve rate hikes to tame soaring inflation.
Spot gold was up 0.9% at $1,656.42 per ounce, as of 1148 GMT, after declining more than 3% last week in its worst performance since July. U.S. gold futures climbed 0.8% to $1,662.30.
Oil prices edged up on Monday in choppy trading as China's continuation of loose monetary policy was partly offset by fears that high inflation and energy costs could drag the global economy into recession.
Brent crude futures rose 53 cents, or 0.6%, to $92.16 a barrel by 1245 GMT, recovering from a 6.4% fall last week. U.S. West Texas Intermediate crude was up 34 cents, or 0.4%, at $85.95 after a 7.6% decline last week.