Tue, Oct 26, 2021 @ 05:28 GMT

European Open Briefing

Global Markets:

  • Asian stock markets: Nikkei down 1.40 %, Shanghai Composite gained 0.15 %, Hang Seng declined 0.05 %, ASX lost 0.10 %
  • Commodities: Gold at $1256 (+0.65 %), Silver at $17.90 (+0.80 %), WTI Oil at $47.85 (-0.30 %), Brent Oil at $50.85 (-0.15 %)
  • Rates: US 10-year yield at 2.37, UK 10-year yield at 1.20, German 10-year yield at 0.40

News & Data:

  • Japanese PPI Services (YoY) Feb: 0.8% (est 0.5%; prev 0.5%)
  • PBoC Fixes USDCNY Reference Rate At 6.8701 (prev fix 6.8845 prev close 6.8850)
  • U.S. equity futures at six-week low after Trump healthcare setback – RTRS
  • Stocks stumble on U.S. policy woes; Trumpflation trades suffer – RTRS
  • Dollar hits near two-month low after Trump’s healthcare debacle – RTRS
  • OPEC, non-OPEC to look at extending oil-output cut by six months – RTRS

Markets Update:

The US Dollar came under broad pressure following the failure of Trump’s healthcare reform on Friday. It was not about the bill itself, but rather the fact that this reduces the chances for Trump’s planned tax reform.

USD/JPY was the worst performing currency pair overnight. The pair was relatively stable at the Sydney open and traded around 111. It came under increasing pressure after Tokyo opened for trading, and eventually declined to a low of 110.25. Key support is seen at 110. Should that level break, it is likely USD/JPY will extend losses to at least 108.

EUR/USD took out an important resistance level at 1.0830. Resistance is now seen ahead of the 1.09 level. Should that one be cleared as well, reaching 1.10 should not be too difficult.

Meanwhile, the Australian Dollar remains rather weak. The negative sentiment in stock markets is weighing on the currency, and traders prefer safe havens such as the Yen and Gold. AUD/USD fell to 0.7615 in Asia, and a break sub-0.76 would signal that another test of 0.75 support may follow soon.

Upcoming Events:

  • 09:00 GMT – German IFO Business Climate
  • 15:30 GMT – US Dallas Fed Manufacturing Index
  • 23:00 GMT – RBA Assistant Governor Debelle speaks
  • 23:30 GMT – FOMC Member Kaplan speaks

The Week Ahead:

Tuesday, March 28th

  • 15:00 GMT – US CB Consumer Confidence
  • 15:00 GMT – US Richmond Manufacturing Index
  • 15:10 GMT – Bank of Canada Governor Poloz speaks

Wednesday, March 29th

  • 15:00 GMT – US Pending Home Sales
  • 15:30 GMT – US Crude Oil Inventories

Thursday, March 30th

  • 01:00 GMT – Australia HIA New Home Sales
  • 11:00 GMT – Euro Zone Consumer Confidence
  • 13:00 GMT – German CPI
  • 13:30 GMT – US GDP
  • 13:30 GMT – US Initial Jobless Claims

Friday, March 31st

  • 00:30 GMT – Japanese CPI
  • 00:30 GMT – Japanese Household Spending
  • 00:50 GMT – Japanese Industrial Production
  • 01:00 GMT – Australian ANZ Business Confidence
  • 02:00 GMT – Chinese Manufacturing PMI
  • 02:00 GMT – Chinese Non-Manufacturing PMI
  • 07:00 GMT – German Retail Sales
  • 07:45 GMT – French CPI
  • 09:00 GMT – German Unemployment Rate
  • 09:30 GMT – UK GDP
  • 10:00 GMT – Euro Zone CPI
  • 10:00 GMT – Italian CPI
  • 13:30 GMT – US Core PCE Price Index
  • 13:30 GMT – US Personal Income
  • 13:30 GMT – US Personal Spending
  • 13:30 GMT – Canadian GDP
  • 15:00 GMT – US Michigan Consumer Sentiment
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