Market Roundup
•US indexes up: Dow 0.71%, S&P 1.06%, Nasdaq 1.27%
•French 3-Month BTF Auction 0.648%, 0.039% previous
•French 6-Month BTF Auction 0.747%, 0.160% previous
•French 12-Month BTF Auction 1.450%,0.746% previous
•US Consumer Inflation Expectations 5.7%,6.2% previous
•US 6-Month Bill Auction 3.465%, 3.320 previous
•US 3-Year Note Auction 3.564%,3.202% previous
•US 10-Year Note Auction 3.330%, 2.755%
Looking Ahead - Economic Data (GMT)
•13:30 Australia Aug NAB Business Confidence 7 previous
•13:30 Australia Aug NAB Business Survey 20 previous
Looking Ahead - Economic events and other releases (GMT)
•No events ahead
Currency Summaries
EUR/USD: The euro jumped to a more than three-week peak versus the dollar on Monday as European Central Bank officials pushed the case for further aggressive monetary tightening. ECB policymakers see growing risks they will have to raise their key interest rate to 2% or more to curb record inflation in the euro zone .The European common currency rose around 1.5% to $1.0198, its highest since Aug. 17, and well up from a 20-year trough of $0.9862 hit last week. It was last up 0.88% at $1.01345. Immediate resistance can be seen at 1.0136(38.2%fib), an upside break can trigger rise towards 1.0172(Higher BB).On the downside, immediate support is seen at 1.0059(50%fib), a break below could take the pair towards 0.9995(9DMA).
GBP/USD: Sterling rose against weaker dollar on Monday as dollar attracted seller ahead of US CPI data. Sterling was also aided by an upbeat global mood on news that Ukrainian forces advanced into territory seized from Russian troops, their worst defeat since the war's early weeks. Overall sentiment towards the pound remained weak with data on Monday highlighting that the UK economy is showing signs of strain from surging prices. Britain’s gross domestic product grew by 0.2% in July from a month earlier, versus economist expectations for growth of 0.4%. A broad pullback in the dollar meant there was some respite for a battered pound, which rallied 1% to $1.17 its highest in almost two weeks and up from a 37-year low hit last week at $1.1407. Immediate resistance can be seen at 1.1693(38.2%fib), an upside break can trigger rise towards 1.1740(21DMA).On the downside, immediate support is seen at 1.1552(9DMA),a break below could take the pair towards 1.1505(23.6%fib).
USD/CAD: The Canadian dollar strengthened to its highest level in more than two weeks against its U.S. counterpart on Monday as a bullish formation for the currency played out in technical charts and investors awaited U.S. inflation data. Investors positioned themselves for a U.S. consumer price reading on Tuesday that could determine the pace of further interest rate hikes by the Federal Reserve. The price of oil, one of Canada's major exports, rose as supply concerns mount heading into the winter. U.S. crude prices settled 1.1% higher at $87.78 a barrel. The loonie was trading 0.3% higher at 1.2985 to the greenback , marking its fourth straight day of gains. Immediate resistance can be seen at 1.3031(38.2%fib), an upside break can trigger rise towards 1.3051 (14DMA).On the downside, immediate support is seen at 1.2966 (50%fib), a break below could take the pair towards 1.2874(61.8%fib).
USD/JPY: The dollar edged lower against yen on Monday as investors awaited U.S. inflation data for further clues on the Federal Reserve’s rate-hike trajectory. All eyes are on the U.S. inflation data set to be released on Tuesday for signs of easing prices pressures and guidance on how far the Federal Reserve will hike interest rates. Traders are betting on a third 75 basis points rate hike by the U.S. central bank next week. Expectations of aggressive U.S. monetary policy tightening have boosted the dollar in recent weeks. The dollar was steady against the rate-sensitive Japanese yen , at 142.59 yen, a little off its 24-year high of 144.99 hit last week. Strong resistance can be seen at 143.25(5DMA), an upside break can trigger rise towards 144.21(23.6%fib).On the downside, immediate support is seen at 141.50(38.2%fib), a break below could take the pair towards 140.80(14DMA).
Equities Recap
European stocks closed higher on Monday, extending recent gains, amid improved risk sentiment despite aggressive policy stance by major central banks and the likely impact on global growth.
UK's benchmark FTSE 100 closed up by 1.66 percent, Germany's Dax ended up by 2.40 percent, France’s CAC finished the day up by 1.95 percent.
Wall Street extended its winning streak on Monday, rallying to a sharply higher close as investors awaited crucial inflation data that could provide clues about the duration and severity of the Federal Reserve's tightening policy.
Dow Jones closed up by 0.71% percent, S&P 500 closed up by 1.06% percent, Nasdaq settled up by 1.27% percent.
Treasuries Recap
Treasury yields eased on Monday as investors await key consumer price data this week that is unlikely to alter another aggressive interest rate hike by the Federal Reserve next week as it tries to slow the U.S. economy to quell inflation.
The yield on benchmark 10-year Treasury notes was down 1.3 basis points to 3.308% and the two-year note's , which typically moves in step with rate expectations, was down 1.8 basis points at 3.553%.
Commodities Recap
Gold jumped about 1% and silver rallied over 5% on Monday, bolstered by a weaker dollar, while investors awaited key inflation data for cues on the pace of interest rate hikes by the U.S. central bank.
Spot gold rose 0.7% to $1,728.57 per ounce by 1:53 p.m. EST (1753 GMT), after rising to its highest since Aug. 30 at $1,734.99.U.S. gold futures settled 7% higher at $1,740.6.
Oil prices settled higher on Monday, shaking off weaker demand expectations as supply concerns mount heading into the winter.
Brent crude futures settled up $1.16, or 1.3%, at $94.00 a barrel. U.S. West Texas Intermediate crude settled up 99 cents, or 1.1%, at $87.78.
