Market Roundup
•US Continuing Jobless Claims 2,845K, 2,650K forecast, 2,665K previous
•US Jobless Claims 4-Week Avg 335.75K, 335.75K previous
•US Initial Jobless Claims 351K,320K forecast, 332K previous
•US Chicago Aug Fed National Activity 0.29,0.53 previous
•Canada Core Retail Sales (MoM) -1.5%, 4.7% previous
•US Sep Market Composite PMI 54.5,58.3 forecast, 55.4 previous
•US Sep Manufacturing PMI 60.5, 61.5 forecast, 61.1 previous
•US Sep Services PMI 54.4, 55.0 forecast, 55.1 previous
•US KC Fed Sep Composite Index 22,29 previous
•US KC Sep Fed Manufacturing Index 10, 22 previous
Looking Ahead - Economic data ahead (GMT)
•00:30 Japan Sep Manufacturing PMI 51.2 forecast, 52.7 previous
•00:30 Japan Sep Services PMI 42.9 previous
Looking Ahead – Events and other releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro strengthened against dollar on Thursday as market shrugged off hawkish Fed statement but gains were limited by weaker Eurozone PMI data. Euro zone business activity grew at its weakest pace in five months in September as curbs to limit the Delta variant of coronavirus hit demand and supply-chain constraints pushed input costs to a more than two-decade high, a survey showed on Thursday.IHS Markit’s Flash Composite Purchasing Managers’ Index, a good gauge of overall economic health, fell to a five-month low of 56.1 in September from 59.0 in August. Immediate resistance can be seen at 1.1751 (50%fib), an upside break can trigger rise towards 1.1771(14DMA).On the downside, immediate support is seen at 1.1718(38.2%fib), a break below could take the pair towards 1.1680 (23.6%fib).
GBP/USD: Sterling rose against dollar on Thursday after Bank of England kept interest rate unchanged at 0.1%. The Bank of England kept its main interest rate unchanged at 0.1% on Thursday and stuck to its 895 billion pound ($1.22 trillion) asset purchase target. Policymakers voted unanimously to keep interest rates unchanged but Dave Ramsden joined Michael Saunders in voting for an early end to the central bank’s ongoing programme of government bond purchases. The pound was last up 0.6% at $1.3708 after trading around $1.3686 before the BoE announcement. Immediate resistance can be seen at 1.3750 (23.6%fib), an upside break can trigger rise towards 1.3770 (21DMA).On the downside, immediate support is seen at 1.3696 (38.2%fib), a break below could take the pair towards 1.3648 (50%fib).
USD/CAD: The Canadian dollar strengthened to a one-week high against its U.S. counterpart on Thursday as investor sentiment picked up and domestic data showed that retail sales fell less than expected in July. Canada is a major exporter of commodities, including oil, so the loonie tends to be particularly sensitive to investor appetite for risk. Canadian retail sales dipped 0.6% in July, compared with expectations for a decline of 1.2%, while a preliminary estimate showed sales rebounding 2.1% in August. The Canadian dollar was trading up 0.9% at 1.2653 to the greenback. Immediate resistance can be seen at 1.2694 (38.2%fib), an upside break can trigger rise towards 1.2788 (23.6%fib).On the downside, immediate support is seen at 1.2623(50%fib), a break below could take the pair towards 1.2554(61.8%fib).
USD/JPY: The dollar strengthened against yen on Thursday after the U.S. Federal Reserve clarified its timeline for rate hikes and as concerns over Chinese property developer Evergrande eased. China injected fresh cash into its financial system ahead of a crucial Evergrande bond coupon deadline, easing some of the concerns over a possible default that had hit markets earlier this week. The dollar was trading 0.24% higher versus the dollar at 110.02. Strong resistance can be seen at 110.07(23.6%fib), an upside break can trigger rise towards 110.32(Higher BB).On the downside, immediate support is seen at 109.66(38.2%fib), a break below could take the pair towards 109.39(50%fib).
Equities Recap
European stocks rallied for a third day on Thursday as global sentiment improved on easing concerns about cash-strapped developer China Evergrande, while comments from Bank of England kept London shares under pressure.
UK's benchmark FTSE 100 closed down by 0.07 percent, Germany's Dax ended up by 0.88 percent, France’s CAC finished the day up 0.98 percent.
U.S. stocks closed higher on Thursday as investors appeared relieved about the Federal Reserve’s stance on tapering stimulus and raising interest rates.
Dow Jones closed up by 1.48% percent, S&P 500 closed up by 1.21 % percent, Nasdaq settled up by 1.04% percent.
Treasuries Recap
U.S. Treasury yields jumped on Thursday after the Federal Reserve opened the door to raising interest rates as early as next year, a potential move that was reinforced by the Bank of England's outlook on rates and a rate hike by the Norwegian central bank.
The two-year U.S. Treasury yield, which typically moves in step with interest rate expectations, was up 1.9 basis points at 0.259%. The breakeven rate on five-year U.S. Treasury Inflation-Protected Securities (TIPS) was last at 2.489%.
Commodities Recap
Gold fell 1% on Thursday, pressured by an uptick in treasury yields and an appetite for riskier assets, as investors continued to position themselves for a sooner-than-expected interest rate hike from the U.S. Federal Reserve.
Spot gold declined 0.9% to $1,751.56 per ounce by 1811 GMT and U.S. gold futures settled 1.6% lower at $1,749.80.
Oil prices rose on Thursday, with Brent crude touching its highest level in more than two months, supported by growing fuel demand and a draw in U.S. crude inventories as production remained hampered in the Gulf of Mexico after two hurricanes.
Brent crude settled up $1.06, or 1.4%, at $77.25 a barrel, its highest price since mid-July. U.S. West Texas Intermediate (WTI) crude rose $1.07, or 1.5%, to $73.30 a barrel.
