Market Roundup
•Canada BoC Interest Rate Decision 3.75%,3.75% forecast,4.25% previous
•US Existing Home Sales (MoM) (Sep) -1.0%,-2.5% previous
•US Existing Home Sales (Sep) 3.84M,3.88M forecast, 3.86M previous
•EU Consumer Confidence (Oct) -12.5,-12.0 forecast, -12.9 previous
•US Crude Oil Inventories 5.474M,0.800M forecast, -2.191M previous
•US Gasoline Inventories 0.878M,-1.600M forecast, -2.201M previous
Looking Ahead economic Data(GMT)
• 00:30 Japan Manufacturing PMI (Oct) 49.9 forecast, 49.7 previous
• 00:30 Japan Services PMI (Oct) 53.1 previous
Looking Ahead Events And Other Releases(GMT)
•No Events Ahead
Currency Forecast
EUR/USD: The euro dipped on Wednesday after European Central Bank President Christine Lagarde said the central bank will need to be cautious when deciding on further interest rate reductions and take its cue from incoming data.ECB's chief economist Philip Lane said he still expected a recovery in the euro zone's economy even though recent data raised some questions about it. The dollar index , which measures the greenback against a basket of currencies, rose 0.32% to 104.43, after climbing to 104.57, its highest since July 30. The euro was down 0.18% at $1.0778 after dropping to $1.076, its lowest since July 3 Immediate resistance can be seen at 1.0816(SMA5 ), an upside break can trigger rise towards 1.0847(38.2%fib).On the downside, immediate support is seen at 1.0785(23.6%fib), a break below could take the pair towards 1.0700(Psychological level).
GBP/USD: Sterling hit a fresh 2-month low against the dollar on Wednesday as investors digested Bank of England's Andrew Bailey comments. Britain's inflation rate, which fell below target in September, has been pushed around by historical energy price related factors, and service price inflation still has to fall further, Bank of England Governor Andrew Bailey said on Wednesday. Investors focus is also on the British budget on Oct. 30, in which Finance Minister Rachel Reeves faces a tough task to raise the tax revenues she needs to invest more in public services and new infrastructure. Immediate resistance can be seen at 1.3054(38.2%fib), an upside break can trigger rise towards 1.3123(50%fib).On the downside, immediate support is seen at 1.2967(Oct 22nd low), a break below could take the pair towards 1.2928 (Lower BB).
USD/CAD: The Canadian dollar weakened to an 11-week low against its U.S. counterpart on Wednesday as the Bank of Canada cut interest rates by an unusually large amount and the greenback added to its recent broad-based gains. The BoC reduced its benchmark rate by 50 basis points to 3.75% as expected and hailed signs Canada has returned to a low-inflation era. It was the first cut of that size in 15 years outside of the pandemic era and increased the amount of easing since June to 125 basis points. The price of oil, one of Canada's major exports, fell 1.7% to $70.51 a barrel after data showed U.S. crude inventories rose more than expected. The loonie was trading 0.2% lower at 1.3840 to the U.S. dollar , after touching its weakest intraday level since Aug. 5 at 1.3862. Immediate resistance can be seen at 1.3855 (23.6%fib), an upside break can trigger rise towards 1.3900(Psychological level).On the downside, immediate support is seen at 1.3863(5SMA), a break below could take the pair towards 1.3784 (38.2%fib).
USD/JPY: The dollar climbed above 153 against the yen for the first time in nearly three months on Wednesday on U.S. economic strength and an expected divergence among major global central banks' pace of interest rate cuts.The dollar strengthened 0.99% to 152.73 ,on track for its biggest daily percentage gain since Oct. 4, after climbing to 153.18, its highest since July 31, when the Bank of Japan raised interest rates to their highest since 2007.Japan is set to hold a general election on Oct. 27. Recent opinion polls indicated that the ruling Liberal Democratic Party could lose its majority with coalition partner Komeito. Immediate resistance can be seen at 153.18 (Daily high), an upside break can trigger rise towards 154.00(Psychological level). On the downside, immediate support is seen at 151.55(5SMA), a break below could take the pair towards 151.07(Daily low)
Equities Recap
European shares closed Wednesday's choppy session in the red, with mining stocks among top drags, while weak earnings from heavyweights such as Germany's largest lender Deutsche Bank and beauty giant L'Oreal pressured sentiment further.
UK's benchmark FTSE 100 closed down by 0.58 percent, Germany's Dax ended down by 0.23 percent, France’s CAC finished the day down by 0.50 percent
Wall Street closed lower on Wednesday, as climbing Treasury yields pressured megacap stocks and investors grew less confident about strong rate cuts from the Federal Reserve, while corporate news pressured McDonald's and Coca-Cola.
Dow Jones closed down by 0.96% percent, S&P 500 closed down by 0.92% percent, Nasdaq settled down by 1.59% percent.
Commodities Recap
Gold prices fell over 1% after hitting a record high on Wednesday, as a stronger dollar and a rise in U.S. Treasury yields countered support from safe-haven demand linked to the Nov. 5 U.S. election and Middle East war.
Spot gold was down 1.2% to $2,714.55 per ounce as of 01:43 p.m. EDT (1743 GMT) after hitting a record high of $2,758.37 earlier in the session.U.S. gold futures settled 1.1% lower at $2,729.40.
Oil prices fell on Wednesday after data showed U.S. crude inventories rose by more than expected even as refining activity rebounded, though futures remained up about 2% this week as traders factored in continuing conflict in the Middle East.
Brent crude futures settled at $74.96, down $1.08, or 1.42%. U.S. West Texas Intermediate crude futures settled down 97 cents, or 1.35%, to $70.77.
