Tag Archive: Australia

FX Daily, September 2: Corrective Pressures Give the Greenback a Reprieve

After poking above $1.20 for the first time in more than two years, the euro reversed lower yesterday and is continuing to succumb to profit-taking pressures today.  Comments from ECB's Lane appeared to trigger a reversal yesterday throughout the currency markets.

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FX Daily, August 18: Canada Shrugs Off Loss of Morneau and Gold Reclaims $2000 Threshold

The NASDAQ rallied 1% yesterday to record highs as the Dow Industrials struggled, and the S&P 500 was able to eke out a small gain. The coattails were short, and the strength of the yen may have contributed to a 0.2% loss of the Nikkei. Still, its 6.2% advance this month is the best among the G10.

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FX Daily, August 13: Dollar Remains Offered

The poor price action on Tuesday in the S&P 500 was shrugged off, and new highs for the recovery were made as the record high nears. The dollar, on the other hand, seemed to find plenty of sellers against most of the major currencies. The yen was a notable exception.

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FX Daily, July 16: Equities Slide and the Greenback Bounces After China’s GDP and Before the ECB

Overview:  Profit-taking, perhaps spurred by disappointing retail sales figures, sent Chinese equity markets down by 4.5%-5.2% today, the most since early February.  It appears to be triggering a broader setback in equities today.  The Hang Seng fell 2%, and most other markets in the region were off less than 1%. 

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FX Daily, July 9: The Dollar is Sold through CNY7.0 as Chinese Equities Continue to Rally

Investors continue to clamor into risk assets.  Led by Chinese shares, the MSCI Asia Pacific Index pushed higher for the third session this week to new five-month highs.  Europe's Dow Jones Stoxx 600 is trying to snap a two-day decline with the help of better than expected revenues for its largest tech company.

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FX Daily, May 19: Optimism Burns Eternal

Overview: Hopes for a vaccine and a German-French proposal to break the logjam at the EU for a joint recovery effort helped propel equities higher yesterday. There was strong follow-through in the Asia Pacific region, where most markets advanced by more than 1% today. However,  the bloom came off the rose, so to speak, in Europe. After a higher opening, markets reversed lower, and the Dow Jones Stoxx 600 is off about 0.75% in late morning turnover.

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FX Daily, May 14: Risk Appetites Wane

Overview: Risk appetites have been gradually waning this week. US equity losses mounted yesterday after Tuesday's late sell-off. Asia Pacific equities were off, with many seeing at least 1.5% drops. Europe's Dow Jones Stoxx 600 is off a little more to double this week's decline and leaves it in a position to be the biggest drop since panicked days in mid-March.

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FX Daily, April 29: Heavy Dollar amid Month-End Pressure

Overview: The dollar is lower across the board as dealers attribute the selling to month-end pressures ahead of the FOMC today and ECB tomorrow and long-holiday weekend for many. Japan's Golden Week holiday has already begun. Despite the loss in US equities yesterday, despite the higher opening, it has not spilled over, as Alphabet earnings helped lift sentiment.

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Cool Video: OIl, ECB, and Animal Spirits

I had the privilege to join Ben Lichtenstein at TD Ameritrade (from a remote location) this morning to talk about the global markets.  I make four points.  First, the reversal of the S&P 500 yesterday set the tone for Asia and Europe.  Volatility throughout the capital markets remains elevated, even if off the peaks.  

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FX Daily, April 8: Flavor of the Day: Consolidation

Overview: Global equities are struggling after the S&P 500 staged a dramatic reversal yesterday. The early 3.5% gain was completely unwound and closed slightly lower.  With few exceptions (e.g., Japan and the Philippines), most equity markets in the Asia Pacific region and Europe are lower.

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FX Daily, February 20: Covid-19 Hits Yen and Korean Won

The increase of Covid-19 cases in South Korea and Japan, coupled with China's changing reverting back to its previous methodology of calculation, dropping clinically-diagnosed cases have again weakened risk appetites and sent the dollar broadly higher. Fears of a Japanese recession are sapping the yen's role as a safe haven, and this helps explain why Japanese equities did react as positively to the weaker yen than is often the case.

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FX Daily, February 18: Apple’s Warning Weighs on Sentiment

Overview: Apple's warning that it will miss Q1 revenue due to the knock-on effects of the coronavirus seemed to be a modest wake-up call to investors, who, judging from the equity market, were looking beyond. Equities have fallen, and bonds have rallied. Japan, Hong Kong, and South Korean stocks fell by more than 1%, and only China and Indonesia were able to post gains.

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FX Daily, January 29: Escaped from a Crocodile’s Mouth, Entered a Tiger’s Mouth

Overview: This colorful Malay saying captures the spirit of the animal spirits. Narrowly escaping an escalation of a trade war between the world's two largest economies, the outbreak of a deadly virus has spurred moves, especially the sell-off in stocks and rally in bonds, for which many investors seemed ill-prepared. Even though the virus contagion has not peaked, the recovery in US equities yesterday points to a break the fear and anxiety.

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FX Daily, January 23: ECB’s Strategic Review and the Coronavirus Command Investors’ Attention

The spread of the coronavirus and the lockdown in the epicenter in China has again sapped the risk-taking appetite in the capital markets. Asia is bearing the brunt of the adjustment. Tomorrow starts China's week-long Lunar New Year celebration when markets will be closed, which may have also spurred today's drama that aw the Shanghai Composite tumbled 2.75%, bringing the week's loss to 3.2%, the most in five months.

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FX Daily, November 20: Dollar Snaps Back

Overview: The idea that a US-China trade deal is proving more elusive than the agreement in principle on October 11 implied is being seized upon to spur what we suspect is an overdue round of profit-taking in global equities. The MSCI Asia Pacific Index snapped a three-advance, with over 1% declines in South Korea and Australia.

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Dollar Mixed on Central Bank Thursday

As expected, the Fed cut rates by 25 bp; the dollar firmed after the decision but has since given back some gains. During the North American session, there will be a fair amount of US data. BOE is expected to keep rates steady; UK reported August retail sales. SNB and BOJ kept rates steady, as expected; Norges Bank unexpectedly hiked 25 bp.

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FX Daily, May 30: Kill Bull: Intermission

Overview:  After significant moves in equities and interest rates, investors are taking a collective breath, waiting for fresh developments.  A nervous calm has settled over the capital market.  China, Japan, and Australian equities leaked lower, but other bourses in the region, including Korea and Taiwan posted modest gains, while Indonesian equities are still responding positively to the recent election.

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FX Daily, May 20: Politics Overshadows Economics Today, but Japan’s Economy Unexpectedly Expanded in Q1

Encouraged by the election results, investors bid up Indian and Australian currencies and equities. Japan offered a pleasant surprise by reporting the world's third-largest economy expanded in Q1. Most other equity markets in Asia fell, and European stocks have the week with small losses.

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FX Daily, May 17: China Questions US Sincerity

Since the presidential tweets on May 3, the US had the initiative in the negotiations with China, but today, China has pushed back. It is cool to the idea promoted by the US that trade talks will resume shortly. Now it may take the Trump-Xi meeting at the end of next month to restart talks. This, coupled with US sanctions on Huawei banning imports from it and sales to it, threatens to disrupt business and this took a toll on Chinese, Taiwanese and...

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FX Daily, May 13: Investors Still Looking for New Balance

The end of the tariff truce between the US and China has discombobulated investors. They had been repeatedly that a deal was close and there had even been talk at the US Treasury about where Trump and Xi should meet to sign the agreement. Now China was given around a month to capitulate to US demands or face a 25% tariff on their remaining exports to the US.

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