Posted at 12 October 2021 / Categories Market Roundups
• US Redbook (YoY) 14.8%,16.6% previous
• US Aug JOLTs Job Openings 10.439M,10.925M forecast, 10.934M previous
• US 6-Month Bill Auction 0.055%,0.055% previous
• US 3-Year Note Auction 0.635%,0.447% previous
Looking Ahead Economic Data (GMT)
• 23:50 Japan Aug Core Machinery Orders (YoY) 14.7% forecast, 11.1% previous
• 23:50 Japan Aug Core Machinery Orders (MoM) 1.7% forecast, 0.9% previous
• 23:50 Japan Sep M3 Money Supply 1,996.3T previous
•00:00 New Zealand Oct ANZ Business Confidence -7.2 previous
•01:00 Australia HIA New Home Sales (MoM) 5.8% previous
•03:00 China Sep Trade Balance (USD) 46.80B forecast, 58.34B previous
•03:00 China Sep Exports (YoY) 21.0% forecast, 25.6% previous
•03:00 China Sep Imports (YoY) 20.0% forecast, 33.1% previous
Looking Ahead - Events, Other Releases (GMT)
•No significant events
EUR/USD: The euro declined against dollar on Tuesday as expectations the U.S. Federal Reserve will announce a tapering of its massive bond-buying program next month, and as concerns over soaring energy prices also sent investors to the safe-haven greenback. The ZEW indicator of economic sentiment in Germany slipped for the fifth month, the latest in a string of indicators showing supply bottlenecks holding back recovery in Europe's largest economy. Investors will watch U.S. Consumer Price Index data on Wednesday and retail sales data on Friday for further clues as to when the Fed might begin winding down stimulus. Immediate resistance can be seen at 1.1542 (38.2%fib), an upside break can trigger rise towards 1.1571(50%fib).On the downside, immediate support is seen at 1.1503(23.6%fib), a break below could take the pair towards 1.1481(Lower BB).
GBP/USD: Sterling steadied against dollar on Tuesday as UK jobs data came in largely in line with forecasts, keeping expectations for future rate rises from the Bank of England intact.The pound hit a two-week high against the greenback on Monday on hawkish comments from BoE governor Andrew Bailey, who stressed the need to prevent inflation, and fellow policymaker Michael Saunders, who said households must brace for “significantly earlier” interest rate rises. Sterling traded a touch lower on the day, down 0.06% against the dollar at $1.3584 and below Monday’s peak of $1.3674. Immediate resistance can be seen at 1.3616(38.2%fib), an upside break can trigger rise towards 1.3682(50%fib).On the downside, immediate support is seen at 1.3543(23.6%fib), a break below could take the pair towards 1.3455(Lower BB).
USD/CAD: The Canadian dollar on Tuesday strengthened to its highest level in more than two months against its U.S. counterpart, supported by elevated oil prices and a wider gap between Canadian and U.S. bond yields. The gap between Canadian and U.S. 2-year yields rose by 3.4 basis points to a spread of nearly 41 basis points in favor of the Canadian bond, its widest since January 2015 when the Canadian dollar was as strong as 1.16.The loonie was trading 0.2% higher at 1.2462 to the greenback , after touching its strongest level since July 30 at 1.2434. Immediate resistance can be seen at 1.2498 (38.2%fib), an upside break can trigger rise towards 1.2535 (9DMA).On the downside, immediate support is seen at 1.2442 (50%fib), a break below could take the pair towards 1.2415 (Lower BB).
USD/JPY: The dollar held near three months high against yen on Tuesday as a relentless rise in Treasury yields widened the yield advantage in favour of the greenback. The yen’s recent weakness falling 4% in three weeks comes at a time when global bond yields have surged due to inflationary concerns. The spike in U.S. yields prompted investors to dump the Japanese yen versus the dollar, resulting in the second-biggest daily fall in the Japanese currency on Monday.As Treasury yields rose further on Tuesday, the dollar hit a three-year high versus the yen. Strong resistance can be seen at 113.44(23.6%fib), an upside break can trigger rise towards 114.00(Psychological level).On the downside, immediate support is seen at 112.89(38.2%fib), a break below could take the pair towards 112.42(50%fib).
European shares lost ground on Tuesday as investors feared that soaring commodity prices would hamper a recovery in corporate profit, with fresh signs of troubles at property developer China Evergrande also denting sentiment.
UK's benchmark FTSE 100 closed down by 0.24 percent, Germany's Dax ended down by 0.34 percent, France’s CAC finished the day down by 0.34 percent.
U.S. stocks finished lower on Tuesday, with investors jittery in the run up to third-quarter earnings, while a jump in Tesla shares helped support the market.
Dow Jones closed down by 0.34 percent, S&P 500 closed down by 0.24 percent, Nasdaq ended down by 0.14 % percent.
Yields on the U.S. two-year Treasury note jumped to their highest level in more than 18 months on Tuesday, as climbing oil prices added to the inflationary picture and heightened expectations that the U.S. Federal Reserve may be forced to take action earlier than currently anticipated.
The yield on the 30-year Treasury bond was down 4.4 basis points to 2.116%. A closely watched part of the U.S. Treasury yield curve measuring the gap between yields on two- and 10-year Treasury notes, seen as an indicator of economic expectations, was at 125.0 basis points after hitting a 3-1/2-month high of 129.7 on Friday.
Gold prices rose on Tuesday, as rising inflation fears dulled risk appetite and boosted demand for the safe-haven metal, although an advancing U.S. dollar limited bullion’s gains.
Spot gold rose 0.3% to $1,759.31 per ounce by 13:44 p.m. EDT (1744 GMT), while U.S. gold futures settled 0.2% higher at $1,759.3.
Oil steadied after a volatile session on Tuesday, pausing a rally that has brought prices to multi-year highs and raised concerns that higher energy costs could derail the global economic recovery.
Brent crude fell 23 cents to settle at $83.42 a barrel, after trading from a high of $84.23 to a low of $82.72. On Monday, the global benchmark hit $84.60, its highest since October 2018.
U.S. West Texas Intermediate crude futures (WTI) ended 12 cents higher at $80.64 a barrel, after ranging between $81.62 and $79.47.