Market Roundup
- Japan Oct CPI, Overall Tokyo, 1.5%, 1.3% previous.
- Japan Oct Core CPI Tokyo YY, 0.5%, 0.5% previous.
- Trump may send U.S. troops to Mexico border, but migrants undeterred.
- WTO member group vows to reform rules on subsidies, dispute settlement.
- Weak soybean exports seen slowing U.S. third quarter growth.
- Still accommodative, Fed must keep hiking U.S. rates –Mester.
- Trump's own hawks: Fed's newest member Clarida backs higher rates.
- Bank of England tells banks to build Brexit cash cushions by March.
- China, Japan sign agreements to strengthen cooperation.
- China's Premier Li - China has no wish for competitive devaluation of yuan.
- U.S. fund investors add stock exposure during volatile week – Lipper.
- Foreign CB US debt holdings +$880 mln to $3.434 tln Oct 24 week.
- Treasuries +$1.845 bln to $3.060 tln, agencies -516 mln to $307.060 bln.
Economic Data Ahead
- (0330 ET/0730 GMT) Sweden retail sales.
- (0330 ET/0730 GMT) Thailand Forex reserves and currency swap.
- (0630 ET/1030 GMT) Russia Interest rate decision.
Key Events Ahead
- (0335 ET/0735 GMT) Norway Central Bank Deputy Governors Jon Nicolaisen and Egil Matsen speak in Sandefjord.
- (0535 ET/0935 GMT) Fed New York Executive Vice President Simon Potter speaks at a conference in Paris.
- (1000 ET/1400 GMT) ECB President Mario Draghi delivers a keynote presentation at a conference Brussels.
- (1015 ET/1415 GMT) ECB Executive Board Member Benoit Coeure speaks at a session during the Euro 50 - CF40 - CIGI meeting in Paris.
FX Recap
USD: The dollar index traded flat at 96.65 on Friday, after hitting a two-month high on Thursday. The gains in the dollar index were largely due to the losses in the euro, which has more than 60 percent weighting in the index.
EUR/USD: The euro traded flat at $1.1375 on Friday, having hit a two-month low of 1.1353 in the previous session, after ECB President Mario Draghi failed to convince traders that the bank could pursue monetary tightening after next summer as political and economic uncertainties grow in the monetary union. The ECB reaffirmed on Thursday that its 2.6 trillion euro ($2.97 trillion) asset purchase programme would end this year and that interest rates could rise after next summer. A consistent close below $1.1374 will drag the parity down towards key supports around $1.1185 and $1.1080 levels respectively. Alternatively, reversal from key support will drag the parity higher towards key resistances around $1.1432, $1.1550, $1.1620, $1.1738 and $1.1852 marks respectively.
USD/JPY: The Japanese yen trades marginally higher in early Asia after CPI as well as core CPI data. Pair was currently trading around 112.18 marks. It made intraday high at 112.44 and low at 112.06 levels. A sustained close above 112.81 is required to take the parity higher towards key resistances around 114.55 and 117.98 marks respectively. Alternatively, a daily close below 111.75 will drag the parity down towards key supports around 110.98, 110.27, 109.24, 108.72 and 107.90 marks respectively.
GBP/USD: The sterling traded marginally higher at $1.2822 after it hit a six-week low of $1.2796 on Thursday following Draghi's comments that the private sector needed to prepare for the possibility that Britain could exit the European Union with no deal on future relations. A sustained close below $1.2817 requires for dragging the parity down towards key supports around $1.2662 and $1.2498 mark respectively. On the other side, key resistances are seen at $1.2919, $1.3187, $1.3215, $1.3362 and $1.3490 levels respectively.
AUD/USD: The Australian dollar was under pressure again on Friday as weakness in Asian stock markets kept the U.S. dollar well bid, though their losses for the week were relatively moderate given the sheer volatility of equities. The Aussie was a shade softer on the day at $0.7023, leaving it down 0.7 percent on the week so far. The pair made intraday high at $0.7082 and low at $0.7023 levels. Immediate support and resistance levels were seen at $0.6827 and $0.7160 mark respectively.
NZD/USD: The kiwi falls gradually against U.S. dollar and current trading around $0.6480 mark. Major support is down at $0.6424, with resistance around $0.6620. Pair made intraday high at $0.6531 and low at $0.6465 levels. A sustained close above $0.6518 is required to take the parity higher towards $0.6727 and $0.7050 mark respectively. Alternatively reversal from key resistance will take the parity down towards key supports around $0.6402 levels.
Equities Recap
Japan’s Nikkei was trading 0.60 pct lower at 21,143.50 points.
Australia’s S&P/ASX 200 was trading 0.02 pct higher at 5,665.85 points.
Shanghai composite index to open up 0.3 pct at 2,610.90 points and China's CSI300 index to open up 0.3 pct at 3,204.28 points.
Taiwanese stock was trading around 0.40 percent lower at 9,483.93 points.
Hong Kong’s Hang seng was trading 1.30 pct lower at 24,675.55 points.
India’s NSE Nifty was trading around 0.50 percent lower at 10,075.22 points while BSE Sensex was trading 0.45 points lower at 33,538.55 points.
South Korea’s Kospi was trading 2.03 percent lower at 2,021.20 points.
Commodities Recap
Oil prices eased on Friday and were heading for a third weekly loss after Saudi Arabia's OPEC governor said the market could be heading into oversupply, as growth concerns took a hit with a slump in global equities this week. Brent crude futures were down 45 cents, or 0.6 percent, at $76.44 a barrel by 0140 GMT. The global benchmark is heading for a weekly loss of 4.2 percent. U.S. crude was down 56 cents, or 0.8 percent, at $66.77 a barrel. The U.S. benchmark is heading for a 3.4 percent loss this week.
Gold prices held steady early Friday as a bounce back in U.S. stocks failed to stimulate its Asian counterparts, with the metal on track to rise for the fourth straight week, its longest string of weekly gains since January. Spot gold was flat at $1,231.17 an ounce at 0101 GMT. On Tuesday, it touched a high of $1,239.68, a peak since July 17. It was up 0.4 percent for the week. U.S. gold futures were up 0.1 percent at $1,233.70 an ounce.
Treasuries Recap
Australian government bond futures held near six-week highs having benefited from safe-haven flows all week. The three-year bond contract was flat at 97.945, while the 10-year contract firmed half a tick to 97.3850.
Yields on 10-year New Zealand government bonds were down 10 basis points for the week at 2.585 percent.
