Aussie Stocks up despite USDJPY shakiness

There were some jitters from USDJPY price action in early NY with the risk-on/risk-off proxy trading down to 108.3 from 108.7 levels. The move however was mostly ignored by S&P 500 Futures which manages to sustain itself near all-time highs. Stronger earnings from Walmart (helped offset the initial drag on the index caused by a weak Cisco outlook.

The reaction from ASX Dec Futures fared similarly with the Aussie index bid 21pts through the night. This should help ASX Cash point up at the open having been propped up yesterday by surges in the stock price of Afterpay (APT.AX) and Nearmap (NEA.AX) following positive news releases. We note ongoing concerns and developments around US-China trade uncertainty, Trump impeachment proceedings, HK and broad political unrest, global growth and central bank policy as catalysts for driving negative sentiment.

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RBA and BoC remarks secondary but still interesting

With little data out in Asia, we monitor a couple of speeches in the Aussie afternoon with RBA Deputy Gov Debelle set to deliver some housing remarks at a FINSIA event and BoC Gov Poloz due to speak at the Fed Reserve Bank of San Francisco. The former is due 12.30pm with the latter coming out around 1.45pm AEDT. CAD positioning wise still remains the highest conviction long bet among G10 currencies given relative BoC hawkishness. We see longer-term bets best expressed in short EURCAD or long CADJPY.

Main data risk ahead in US Retail Sales

The Fed continue to drive home the point that US consumers are on stable footing and confidence is up. US Core Retail Sales m/m due for release at 12.30am AEDT tonight should stress-test that assumption. Forecasts are currently indicating a positive print. The m/m print polled 0.2%, an improvement on the prior month’s -0.3%. Excluding Autos m/m, consensus comes in at 0.4%, up on the previous -0.1%. A beat here could be the catalyst for a push higher in equities notwithstanding developments in the ongoing concerns we mentioned above.

Elsewhere

Germany avoids a technical recession but it’s nothing to celebrate. GDP q/q printed 0.1% beating out expectations of -0.1%. EURUSD found a 20pip bid on the result and has since sustained above 1.1 levels.

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