• FX: The aussie was the strongest major currency and the loonie was the weakest as PM Trudeau called for an election on October 21, introducing an element of political uncertainty into the currency. For more on today’s moves and the outlook for major currencies moving forward, today’s articles on GBP/USD and USD/CHF.
  • US data: August PMI came in at +1.8% y/y, above expectations of a +1.7% reading. Continued solid inflation readings have caused traders to cut back the odds of a 50bps “double” rate cut from the Fed next week, though a 25bps cut looks like a done deal at this point.
  • Separately, President Trump met with his advisors to discuss a possible capital gains tax cut.
  • Tomorrow’s ECB decision will be the week’s marquee event – see our full preview here!
  • Commodities: Oil fell around -2.5% on the day while gold edged higher after four straight days of selling.

  • US indices traded higher across the board, with the tech-heavy Nasdaq leading the way.
  • Utilities (XLU) and Materials (XLB) were the strongest major sector on the day, while REITs (XLRE) brought up the rear.
  • Stocks on the move:
  • A couple of retailers rallied on no company-specific news: J.C. Penney Company (JCP) tacked on 25% today, while embattled Overstock.com (OSTK) gained 7%.
  • All was not well for retailers though as GameStop (GME) lost -10% after reporting worse-than-expected earnings.
  • RH (RH) rallied 5% on better-than-expected earnings figures.

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DISCLAIMER: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase of sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

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