Tag Archive: Canada

Has the Market Carried the Fed’s Water? Is the Dollar Vulnerable to Buy the Rumor and Sell the Fact?

Overview: The US dollar is trading with a bit of heavier bias against most of the major currencies as the focus turns to today's FOMC meeting, where a clear consensus has emerged in favor of faster tapering and a dot plot pointing to a steeper pace rate hikes.  Emerging market currencies led by Turkey and South Africa are mostly lower. The JP Morgan Emerging Market Currency Index is lower for the third straight session.  The US 10-year Treasury...

Read More »

No Turnaround Tuesday for Equities?

Overview:  Activity in the capital markets is subdued today, ahead of tomorrow's FOMC meeting conclusion and the ECB meeting on Thursday.  The MSCI Asia Pacific equity index fell for the third consecutive session.  European bourses are heavy after the Stoxx 600 posted an outside down day yesterday. Today would be the fifth consecutive decline. Selling pressure on the US futures indices continues after yesterday's losses.  Australia and New Zealand...

Read More »

Dollar Starts the Week Bid ahead of the FOMC

Overview: Equities, bonds, and the dollar begin the new week on a firm note.  Japanese, Chinese, Australian, and New Zealand equities advanced in the Asia Pacific region.  Europe's Stoxx 600 is snapping a three-day decline, and US futures are 0.25%-0.35% higher.  The US 10-year yield is a little softer at 1.48%. European benchmark yields are mostly 1-2 bp lower, and near 0.71%, the UK Gilt's yield is at a three-month low.  The dollar is rising...

Read More »

Markets Turn Cautious Ahead of Tomorrow’s US CPI

Overview: The euro has come back offered after its seemingly inexplicable advance yesterday.  The dollar is firmer against most major currencies today, with the yen an exception after JPY114.00 held on yesterday's advance.  Most emerging market currencies are also softer, with a handful of smaller Asian currencies proving a bit resilient.  Most large bourses advance in the Asia Pacific region, except Japan and Australia.  Europe's Stoxx 600 is...

Read More »

Animal Spirits Roar Back

Overview:  A return of risk appetites can be seen through the capital markets today, arguably encouraged by ideas that Omicron is manageable and China's stimulus.  Led by Hong Kong and Japan, the MSCI Asia Pacific rose by the most in three months, while Europe's Stoxx 600 gapped higher, leaving a potentially bullish island bottom in its wake.  US futures point to a gap higher opening when the local session begins.  The bond market is taking it in...

Read More »

The Greenback Finds Traction ahead of the Jobs Report

Overview:  The Omicron variant has been detected in more countries, but the capital markets are taking it in stride.  Risk appetites appear to be stabilizing.  The MSCI Asia Pacific Index rose for the third consecutive session, though Hong Kong and Taiwan markets did not participate in the advance today.  Europe's Stoxx 600 is struggling to hold on to early gains, while US futures are narrowly mixed.  The US 10-year yield is a little near 1.43%,...

Read More »

Euro Bounces Back, but the Turkish Lira Remains Unloved

Overview:  The US dollar's sharp upside momentum stalled yesterday near JPY115 and after the euro met (and surpassed) a key retracement level slightly below $1.1300.  Led by the Antipodean currencies today, the greenback is mostly trading with a heavier bias.  Among the majors, helped by a steadying of US yields, the yen is soft.  In the emerging market space, the Turkish lira continues its headlong plunge while the yuan softened and the Mexican...

Read More »

European Gas Jumps, while the Euro and Yen Slump

Overview: The prospects that the 6.2% CPI will prompt the Fed to move quicker continue to underpin the dollar.  The euro fell to about $1.1265, its lowest level since last September, and the Japanese yen slumped to a fresh four-year low.  The JP Morgan Emerging Market Currency Index tumbled 1% yesterday, the largest decline since February.  A more stable tone is evident in Europe, as the euro has recovered above $1.13, and the JP Morgan Index is...

Read More »

US Retail Sales and Industrial Output to Accelerate; China not so Much

At the halfway point of Q4, the markets' focus is on three things:  inflation, growth, and central banks' response. With US and Chinese October inflation readings behind us, the focus shifts to the real economy's performance, the world's two largest economies reporting retail sales and industrial production figures.   Helped by stronger auto sales, the first increase in six months, US retail sales likely turned in another solid showing of around...

Read More »

Today’s Big Events Still Lie Ahead

Overview: The day’s big events lie ahead:  the UK’s budget, the Bank of Canada, and the central bank of Brazil meetings.  The US data on tap, especially trade and inventories, will allow economists to fine-tune their forecasts for tomorrow’s first estimate of Q3 GDP. The mixed tech earnings helped spur a bout of profit-taking in Asia Pacific equities, where most of the large markets fell. Europe’s Stoxx 600 is posting a slight loss for the first...

Read More »

Consolidative Session as Markets Await Fresh Incentives

Overview: The markets lack a clear direction today and await fresh incentives.  After gaining almost 1% yesterday, the MSCI Asia Pacific Index slipped.  Japan, Hong Kong, and Australia are among the few equity markets that rose.

Read More »

FX Daily, October 11: Rate Expectation Adjustment Continues

Overview:  Equities are softer and yields higher to start the new week.  The dollar is mixed.  Oil and industrial metals are higher. There are several developments over the weekend, but the focus seems to be on central bank action, inflation reports by the US and China, and the start of the Q3 earnings season. 

Read More »

Ever Grand

Overview: Coming into yesterday's session, the S&P 500 had fallen in eight of the past ten sessions.  It closed on its lows before the weekend and gapped.  Nearly the stories in the press blamed China and the likely failure of one of its largest property developers, Evergrande. 

Read More »

Risk Appetites Didn’t Return from the Weekend

Overview: Investors' mood did not improve over the weekend, and the lack of risk appetites are rippling through the capital markets today.  Equities have tumbled, yields have backed off, and the dollar is well bid.  Hong Kong and Australia led the sell-off in the Asia Pacific region, off 3.3% and 2.1%, respectively. 

Read More »

Is it Really all about US CPI?

Overview:  The markets are in a wait-and-see mode, it appears, ahead of the US CPI figures, as it absorbs bond supply from Europe and monitors the potential restructuring of China's Evergrande.  A new storm may hit US oil and gas in the Gulf before recovering from the past storm and helping to underpin prices.

Read More »

Don’t Make a Fetish Out of What may be a Minor Change in the Pace of ECB Bond Buying

Overview: Yesterday's retreat in US indices was part of and helped further this bout of profit-taking. The MSCI Asia Pacific Index ended an eight-day advance yesterday and fell further today. Japanese indices, which had set multiyear highs, fell for the first time in nine sessions. Hong Kong led the regional slide with a 2.3% decline as China's crackdown on the gaming industry continued. 

Read More »

Consolidative Mood Grips Markets

Overview:  The dollar is consolidating yesterday's advance and is confined to fairly narrow ranges in quiet turnover.  Most of the major currencies are within 0.1% of yesterday's close near midday in Europe. The $1.1700-level held in the euro. 

Read More »

Gold’s Flash Crash and Limited Follow-Through Greenback Gains

Overview:  A flash crash saw gold drop more than $70 an ounce in early Asia. Silver was dragged lower too.  The precious metals have stabilized at lower levels, but it signals a rough adjustment to a higher interest rate environment as a hawkish BOE and strong US employment data suggest peak monetary stimulus is at hand. 

Read More »

US Employment Data is Important but for the Millionth Time, Don’t Exaggerate It

Overview: Record high closes yesterday for the S&P 500 and NASDAQ have done little to help global equities today.  Most of the Asia Pacific region markets, but Japan and Australia slipped ahead of the weekend while still holding on to gains for the week.

Read More »

Greenback Softens amid Stronger Risk Appetites to Start August

Overview: Risk appetites snap back after easing in the waning hours last month. The MSCI Asia Pacific equities jumped back after dropping 1.8% last week for the second week in a row. Japan's Topix and China's CSI 300 rose by more than 2%, and Hong Kong, Taiwan, and Australia gained more than 1%. 

Read More »