Market Roundup
- EUR/USD 0.18%, USD/JPY 0.02%, GBP/USD -0.14%, EUR/GBP 0.32%
- DXY -0.14%, DAX -0.06%, FTSE 0.22%, Brent 1.43%, Gold 0.11%
- Euro nears two-week high as markets await Fed minutes, trade talks
- Lira steady after Bolton says Turkey made 'big mistake' over pastor
- Rouble retreats as sanctions risk makes investors nervous
- Economic tailwinds help Australia dollar weather political squall
- U.S., China to resume trade talks in Washington amid low expectations
- Japan c.bank may dial back stimulus before price goal met - ex-BOJ Ishida
- Sanctions on Iran having effect, but regime change is not U.S. policy - Bolton
- Oil tops $73 on report of U.S. inventory drop, Iran sanctions
Economic Data Ahead
- (1000 ET/1400 GMT) National Association of Realtors is likely to report that U.S. existing home sales rose 1.2 percent to a seasonally adjusted annual rate of 5.40 million units in July, after declining 0.6 percent to a seasonally adjusted annual rate of 5.38 million units in the previous month.
- (0830 ET/1230 GMT) Statistics Canada is expected to report that retail sales gained 0.1 percent in June after rising 1.2 percent in May. While excluding autos, retail sales are likely to have declined 0.1 percent, after advancing 1.4 percent in the previous month.
- (1100 ET/1600 GMT) The Energy Information Administration (EIA) reports its Crude Oil Stocks for the week ending August 17.
Key Events Ahead
- (1400 ET/1800 GMT) The Federal Open Market Committee issues minutes of its July 31 - August 1 policy meeting,
FX Beat
DXY: The dollar index slumped to a near 3-week low as criminal conviction of Trump's two former advisers raised further uncertainty over his leadership. The greenback against a basket of currencies trades 0.3 percent down at 94.97, having touched a low of 94.96 earlier, its lowest since August 2. FxWirePro's Hourly Dollar Strength Index stood at -159.10 (Highly Bearish) by 1000 GMT.
EUR/USD; The euro surged to a near 2-week peak as the greenback tumbled amid growing U.S. political uncertainty, reinforced by the criminal convictions of two of President Donald Trump's ex-advisors. The European currency traded 0.2 percent up at 1.1590, having touched a high of 1.1602 earlier, its highest since August 9. FxWirePro's Hourly Euro Strength Index stood at 156.40 (Highly Bullish) by 1000 GMT. Immediate resistance is located at 1.1628 (August 8 High), a break above targets 1.1667 (August 2 High). On the downside, support is seen at 1.1451 (10-DMA), a break below could drag it till 1.1394 (August 20 Low).
USD/JPY: The dollar extended gains from the previous session, as investors expect minutes of the Federal Reserve's last meeting to confirm it is on course to raise rates twice more this year. The major was trading 0.1 percent up at 110.47, having hit a low of 109.77 on Tuesday, its lowest since June 27. FxWirePro's Hourly Yen Strength Index stood at -39.88 (Neutral) by 1000 GMT. Investors’ will continue to track broad-based market sentiment, ahead of the U.S. existing home sales data. Immediate resistance is located at 110.80 (61.8% retracement of 111.43 and 109.77), a break above targets 111.08 (78.6% retracement). On the downside, support is seen at 110.00, a break below could take it lower 109.68 (June 27 Low).
GBP/USD: Sterling eased after rising to a near 2-week peak in the previous session, as investors shifted their focus back to negotiations for Britain's departure from the European Union. Moreover, comments from diplomats in Brussels stating that they expected a delay in finalizing the terms of Britain's exit dented the bid tone around the British pound. The major traded 0.05 percent down at 1.2893, having hit a high of 1.2924 on Tuesday; it’s highest since August 8. FxWirePro's Hourly Sterling Strength Index stood at -7.85 (Neutral) 1000 GMT. Immediate resistance is located at 1.2977 (61.8% retracement of 1.3173 and 1.2661), a break above could take it near 1.3173 (July 26 High). On the downside, support is seen at 1.2780 (5-DMA), a break below targets 1.2730. Against the euro, the pound was trading 0.3 percent down at 89.92 pence, having hit a low of 90.02 on Tuesday, it’s lowest since August 9.
USD/CHF: The Swiss franc rallied to an 11-week peak as U.S. President Donald Trump's political position was threatened by the criminal convictions of two former advisers. The major trades 0.3 percent down at 0.9820, having touched a low of 0.9819 earlier, it’s lowest since June 8. FxWirePro's Hourly Swiss Franc Strength Index stood at 85.72 (Slightly Bullish) by 1000 GMT. On the higher side, near-term resistance is around 0.9858 (23.8% retracement of 0.9982 and0.9819) and any break above will take the pair to next level till 0.9882 (38.2% retracement). The near-term support is around 0.9810 and any close below that level will drag it till 0.9785.
Equities Recap
European shares consolidated within narrow ranges, while the greenback slumped to a near 3-week low ahead of the release of the Federal Reserve's August meeting minutes later in the day.
The pan-European STOXX 600 index advanced 0.05 percent at 384.20 points, while the FTSEurofirst 300 index surged 0.1 percent to 1,503.54 points.
Britain's FTSE 100 trades 0.3 percent up at 7,590.02 points, while mid-cap FTSE 250 gained 0.1 percent to 20,654.19 points.
Germany's DAX fell 0.05 percent at 12,379.77 points; France's CAC 40 trades 0.2 percent higher at 5,419.47 points.
Commodities Recap
Crude oil prices rose to a 1-week peak as an industry report showed a fall in U.S. crude inventories and U.S. sanctions on OPEC producer Iran indicated tighter supplies. International benchmark Brent crude was trading 1.2 percent up at $73.67 per barrel by 1008 GMT, having hit a high of $73.72 earlier, its highest since August 14. U.S. West Texas Intermediate was trading 0.8 percent higher at $66.60 a barrel, after rising as high as $66.66 earlier, its highest since August 14.
Gold prices rallied to a 1-week high as the dollar consolidated near a 2-week low after U.S. President Donald Trump's criticized the Federal Reserve's interest rate hikes. Spot gold rose 0.1 percent to $1,197.26 an ounce at 1012 GMT, having hit a high of $1197.88 earlier, its highest since August 14. U.S. gold futures were largely unchanged at $1,200 an ounce.
Treasuries Recap
The U.S. Treasuries jumped ahead of today’s release of the minutes from this month’s FOMC meeting. The yield on the benchmark 10-year Treasuries slumped nearly 2 basis points to 2.82 percent, the super-long 30-year bond yields slipped nearly 1-1/2 basis points to 2.99 percent and the yield on the short-term 2-year traded 1 basis point lower at 2.60 percent.
The German bunds remained nearly flat during European session as investors wait to watch the country’s manufacturing PMI for the month of August, scheduled to be released on August 22, besides, the European Central Bank’s (ECB) account of monetary policy meeting, due on the same day by 11:30GMT. The German 10-year bond yields, which move inversely to its price, rose nearly 1 basis point to 0.335 percent, the yield on 30-year note traded tad higher at 0.992 percent and the yield on short-term 3-year too remained close to 1 basis point higher at -0.616 percent.
The New Zealand bonds closed higher after global dairy prices slumped at the overnight GlobalDairyTrade (GDT) price auction, shrugging off the higher-than-expected reading in the country’s retail sales for the second quarter of this year. At the time of closing, the yield on the benchmark 10-year note, which moves inversely to its price, slipped nearly 1/2 basis point to 2.615 percent, the yield on the long-term 20-year note slumped nearly 1-1/2 basis points to 2.925 percent and the yield on short-term 2-year also closed nearly 1-1/2 basis points lower at 1.720 percent.
The Japanese government bonds slid during late Asian session as risk appetite improved despite United States President Donald Trump’s suspected involvement in campaign finance crimes, as outlined by his lawyer, Michael Cohen. The yield on the benchmark 10-year JGB note, which moves inversely to its price, remained slightly higher at 0.095 percent, the yield on the long-term 30-year note jumped 1-1/2 basis points to 0.846 percent and the yield on short-term 2-year traded tad higher at -0.119 percent.
The Australian bonds traded narrowly mixed in subdued session as investors remain side-lined in any major deal ahead of the U.S.-China trade talks. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, traded flat at 2.546 percent, the yield on the long-term 30-year bond remained steady at 3.051 percent and the yield on short-term 2-year fell 1 basis point lower at 2.011 percent.
