Market Roundup
- Fox still alone in projecting trump as winner in Wisconsin, other networks say too close to call
- S. Korea currently has no FX liquidity problems, officials watching situation closely -Finmin Official
- PBOC sets yuan mid-point at 6.7832 / dollar vs last close 6.7838
- U.S. Gold futures for December delivery up $62.5, or 4.9 percent, to $1,336.8/oz
- Spot gold rises 4.5 pct to $1332.60/oz
- Australian dollar skids 5.9 pct against yen, largest one-day drop since 2010
- Mexico peso weakens over 13 pct
- Euro rises more than 2 pct versus dollar, posts biggest intraday rise since December 2015
- Dollar falls more than 2 pct versus Swiss franc, posts biggest intraday fall since December 2015
- Indian rupee opens at 66.70 per dollar vs previous close of 66.615/625 after government abolishes use of current larger bank notes
- Dutch Sept Manufacturing output +0.4 pct m/m after revised -0.8 pct in Aug - CBS
Economic Data Ahead
- (0230 ET/0730 GMT) Thailand BOT Rate Decision
- (0300 ET/0800 GMT) Denmark Current Account
- (0300 ET/0800 GMT) Denmark Trade Balance
- (0300 ET/0800 GMT) Czech Republic CPI MM
- (0300 ET/0800 GMT) Czech Republic CPI YY
- (0430 ET/0930 GMT) Great Britain Goods Trade Bal. Non EU.
- (0430 ET/0930 GMT) Great Britain Goods Trade Balance GBP
- (0430 ET/0930 GMT) South Africa Business Confidence Index
- (0500 ET/1000 GMT) Greece CPI YY
- (0600 ET/1100 GMT) Brazil IPCA Inflation Index MM
- (0600 ET/1100 GMT) Brazil IPCA Inflation Index YY
Key Events Ahead
- (1500 ET/2000 GMT) Reserve Bank of New Zealand policy meeting
FX Beat
DXY: The dollar declined across the board on increasing prospects of Trump victory in the U.S. presidential election. The greenback against a basket of currencies trades 1.9 percent lower at 96.09, having hit an early low of 95.89, its lowest since Oct. 4.
EUR/USD: The euro rallied above the 1.1200 handle as investors see the possibility of a shock win by Republican Donald Trump that could upset the global political order. The major initially hit a low of 1.0989, however, retreated as markets sold the greenback across the board. The European currency trades 2.01 percent higher at 1.1240, having hit an early high of 1.1266, its strongest since Sept. 26. Traders now await U.S. presidential election result for further clues on the pair. Immediate resistance is located at 1.1300, a break above could take it over 1.1350. On the downside, support is seen at 1.1100, a break below could drag it lower till 1.1000.
USD/JPY: The dollar hit fresh 1-month low, as markets worry a Trump victory could cause international economic and trade turmoil, triggering a renewed bout of risk-off market sentiment, sending investors stampeding towards safe-haven yen. Meanwhile, Asian shares traded in red, bolstering the bid tone around the Japanese yen. The major trades 3.3 percent lower at 101.68, after touching a low of 101.45, it’s lowest since Oct. 3. Immediate resistance is located at 102.00, a break above targets 102.75/ 103.50. On the downside, support is seen at 101.45 (Session Low), a break below could take it lower 101.00.
GBP/USD: Sterling rose by more than 1 percent above the 1.2500 handle, as a potential Trump win induced sell-off in the U.S. dollar against most of its major peers. The major initially declined to a low of 1.2353, however, rallied thereafter as the greenback tumbled across the board. Moreover, risk sentiment remained under heavy pressure as markets worry over Trump presidency. Sterling trades 1.2 percent up at 1.2522, hovering towards a high of 1.2557 hit in the previous week. Britain's trade balance figures are due later in the day, however, market might ignore fundamental drivers and continue to track U.S presidential result. Immediate resistance is located at 1.2600, a break above could take it near 1.2650. On the downside, support is seen at 1.2353 (Session Low), a break below targets 1.2300. Against the euro, the pound trades 1.0 percent lower at 89.93 pence, hovering towards an early low of 89.99 pence, its lowest since Sept. 3.
AUD/USD: The Australian dollar slumped below the 0.7600 handle, as investors rushed towards safe haven assets on increasing prospects of Trump victory in the U.S. presidential election. Moreover, the selling pressure intensified after the Chinese CPI came in below estimates on monthly basis at -0.1 percent, while on yearly basis it stood at 2.1 percent, in line with expectations. The Aussie trades 2.1 percent lower at 0.7596, after declining as low as 0.7579 earlier in the session. Investors will continue to track board based sentiment, ahead of Australia's consumer inflation expectation figures. Immediate support is seen at 0.7579 (Session Low), a break below could drag it near 0.7550. On the upside, resistance is located at 0.7650, a break above targets 0.7700.
NZD/USD: The New Zealand dollar declined more than 1 percent below the 0.7300 handle, as increasing prospects of Trump victory triggered a wave of risk aversion as widely expected. Moreover, mixed Chinese data and growing expectations of Reserve Bank of New Zealand easing its policy on Thursday weakened the bid tone around the major. The Kiwi trades 1.3 percent lower at 0.7290, hovering above a 1-week low of 0.7272 hit earlier in the day. The pair will be driven by board based market sentiment, ahead of RBNZ monetary policy meeting. Immediate resistance is located at 0.7350, a break above targets 0.7400. On the downside, support is seen at 0.7260 (10-DMA), a break below could drag it near 0.7200.
Equities Recap
Asian shares tumbled, as investors fear a Trump victory could trigger international economic and trade turbulence, discouraging the Federal Reserve from hiking interest rates in December.
MSCI's broadest index of Asia-Pacific stocks outside Japan was down by more than 3 percent.
Tokyo's Nikkei lost 5.88 percent at 16,161.00 points, Australia's S&P/ASX 200 index slumped 1.92 percent to 5,156.60 points and South Korea's KOSPI was trading 3.54 percent lower at 1,932.21 points.
Shanghai composite index declined 0.64 percent to 3,127.13 points, while CSI300 index was trading 0.49 percent lower at 3,334.75 points.
Hong Kong’s Hang Seng was trading 3.59 percent down at 22,089.62 points. Taiwan shares shed 3.0 percent at 8,939.24 points.
Commodities Recap
Crude oil prices slumped as vote counting showed Republican Donald Trump leading in the U.S. presidential election. International benchmark Brent crude was trading 2.3 percent lower at $44.79 per barrel by 0407 GMT, having hit a fresh 3-month low of $44.38 earlier in the session. U.S. West Texas Intermediate crude declined 2.9 percent at $43.51 a barrel, after falling to an early low of $43.06, its lowest since September.
Gold climbed more than 3 percent to its highest in 5-weeks as Republican Donald Trump held marginal lead against Democrat Hillary Clinton in the race for the White House, sending investors stampeding towards safe havens. Spot gold rose 3.4 percent to $1,318.47 by 0413 GMT, having hit a high of $1322.73, its strongest since Sept. 30. U.S. gold for December delivery was up 3.3 percent at $1,317.30 an ounce, after earlier hitting $1,324.30.
Treasuries Recap
The 10-year U.S treasury yield stood at 1.7269 percent lower by 0.135 bps, while 5-year yield was 0.164 bps down at 1.1656 percent.
The Australian government bonds rallied as Republican presidential candidate Donald Trump took a surprise lead over his Democratic opponent Hillary Clinton in one of the most bitterly contested fights for Presidency. The yield on the benchmark 10-year Treasury note fell 10-1/2 basis points to 2.256 percent, the yield on 15-year note also dipped 10 basis points to 2.642 percent and the yield on short-term 2-year slid 7 basis points to 1.601 percent.
The New Zealand government bonds closed lower ahead of the Reserve Bank of New Zealand monetary policy decision, where it is widely expected to lower its official cash rate by 25 basis points to a new record low of 1.75 percent. The yield on the benchmark 10-year bond rose 1 basis points to 2.755 percent, the yield on 5-year note ended 1-1/2 basis points higher at 2.280 percent and the yield on short-term 2-year note bounced 2 basis points to 2.030 percent.
Canadian government bond prices were lower across the yield curve, with the two-year down 2 Canadian cents to yield 0.564 percent and the benchmark 10-year falling 9 Canadian cents to yield 1.229 percent.
