Posted at 26 October 2022 / Categories Market Roundups
Market Roundup
•US Sep Retail Inventories Ex Auto 0.6% previous
•US Sep Goods Trade Balance -87.28B previous
•US Sep New Home Sales 585K,685K previous
•US Sep New Home Sales (MoM) -13.9%forecast,28.8% previous
•Canada BoC Interest Rate Decision 4.00% forecast,3.25% previous
•US Gasoline Inventories-0.805M forecast,-0.114M previous
•US Crude Oil Inventories 1.029M forecast,-1.725M previous
Looking Ahead - Economic Data (GMT
• 00:30 Australia Import Price Index (QoQ) (Q3) 4.3% previous
•00:30 Australia Export Price Index (QoQ) (Q3) 10.1% previous
•01:30 Chinese Jul Industrial profit (YoY) 0.80% previous
•01:30 Chinese Sep Chinese Industrial profit YTD -2.1% previous
•03:00 Japan BoJ Outlook Report (YoY)
Looking Ahead - Events, Other Releases (GMT)
•No data ahead
Currency Summaries
EUR/USD The euro climbed back above parity against the dollar for the first time in a month on Wednesday after poor U.S. economic data reinforced speculation that the Federal Reserve will slow its interest rate hikes, sending the greenback tumbling. Investors are focussing on European Central Bank meeting on Thursday. The European Central Bank is widely expected to raise rates by 75 basis points amid a looming recession. The European common currency rose 0.05% to $1.0084, the highest since Sept. 20.Immediate resistance can be seen at 1.0092(38.2%fib), an upside break can trigger rise towards 1.0200 (23.6%fib).On the downside, immediate support is seen at 1.0005 (50%fib), a break below could take the pair towards 0.9977 (5DMA).
GBP/USD: Sterling soared to six-week highs on Wednesday, as Britain’s new Prime Minister Rishi Sunak holds his first cabinet meeting amid reports he could delay the announcement of a plan to repair the country’s public finances. Sunak took power on Tuesday with a promise to fix the mistakes of his predecessor and stabilise the economy, warning Britain faced a “profound economic crisis”.Foreign minister James Cleverly said on Wednesday the government’s fiscal plan, scheduled for Oct. 31 and hotly anticipated by markets, could be delayed, suggesting a little more time might be needed to spell out the details.The pound was last up 1.16% against the dollar at $1.1601. Immediate resistance can be seen at 1.1660 (23.6%fib), an upside break can trigger rise towards 1.1719 (Higher BB).On the downside, immediate support is seen at 1.1474(5DMA), a break below could take the pair towards 1.1424(38.2%fib).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Wednesday but lost ground against all the other G10 currencies as the Bank of Canada raised interest rates less than investors expected . The BoC increased its benchmark rate by half a percentage point to 3.75%, coming up short on calls for another 75 basis-points move, as it forecast the economy would stall over the next three quarters.Higher oil prices added to support for the loonie, with U.S. crude oil futures settling 3% higher at $87.91 a barrel. The loonie was trading 0.3% higher at 1.3565 to the greenback . Immediate resistance can be seen at 1.3623 (5DMA), an upside break can trigger rise towards 1.3654 (38.2%fib).On the downside, immediate support is seen at 1.3525 (50%fib), a break below could take the pair towards 1.3449 (Lower BB).
USD/JPY: The dollar dipped against the yen on Wednesday as more signs of economic weakness in the United States fanned speculation about a less hawkish Federal Reserve weighed on greenback. U.S. economic data on Tuesday showed slowing home price growth and souring consumer confidence, with some signs that the Fed’s aggressive interest rate hikes are starting to cool the labour market. The Japanese yen strengthened 0.61 versus the greenback at 146.99 per dollar. The beaten-down currency had touched a 32-year low at 151.94 on Friday, but retreated after two bouts of suspected Bank of Japan intervention either side of the weekend. Strong resistance can be seen at 147.27 (5DMA), an upside break can trigger rise towards 148.32 (Higher BB).On the downside, immediate support is seen at 145.83 (38.2%fib), a break below could take the pair towards 143.92(50%fib).
Equities Recap
European stocks closed higher on Wednesday, extending recent gains, as investors continued to react to earnings updates and looked ahead to the European Central Bank's monetary policy meeting.
The UK's benchmark FTSE 100 closed up by 0.61 percent, Germany's Dax ended up by 1.09 percent, and France’s CAC finished the day up by 0.41percent.
The S&P 500 ended a three-day winning streak on Wednesday, closing in negative territory as gloomy earnings guidance added to growing fears of a global economic slowdown.
Dow Jones closed up by 0.01 percent, S&P 500 ended down by 0.74 percent, Nasdaq finished the down up by 2.24 percent.
Treasuries Recap
Treasury yields fell on Wednesday, helped by a weaker dollar and renewed speculation that the Federal Reserve may slow its rapid pace of raising interest rates to tackle high inflation after a closely watched part of the yield curve inverted further.
The gap between yields on three-month bills and 10-year Treasury notes turned negative on Tuesday on an intraday basis but has not closed inverted since March and February 2020, when it indicated a recession loomed.
Commodities Recap
Gold prices rose to a two-week high on Wednesday as the dollar and U.S. bond yields slipped on expectations the Federal Reserve will temper its aggressive rate-hike stance starting December.
Spot gold rose 0.8% to $1,665.09 per ounce by 1:40 p.m. ET (1740 GMT) after touching its highest since Oct. 13.U.S. gold futures settled up 0.7% to $1,669.20.
Oil prices surged nearly 3% on Wednesday, bolstered by record U.S. crude exports and as the nation's refiners operated at higher-than-usual levels for this time of year.
Brent crude futures settled up $2.17, or 2.3%, to $95.69 a barrel. U.S. West Texas Intermediate (WTI) crude rose $2.59, or 3%, to $87.91.