Tag Archive: FX Daily

FX Daily, November 18: Sterling Shines in Subdued Start to the New Week

Overview: Equities in Europe and the US look to extend their six-week rally, while the MSCI Asia Pacific Index gets back on the winning way after stumbling last week. Despite the escalation of the conflict in Hong Kong, the Hang Seng rose 1.35% to lead the region and recoup a chunk of last week's 4.8% slump. The Dow Jones Stoxx 600 puts the European benchmark within spitting distance of the four-year high set recently.

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FX Daily, November 15: Market Runs with US Line that US-China Deal is Close

Comments by US presidential adviser Kudlow playing up the prospects of a trade agreement between the US and China, with other reports suggesting a key call be held today, is helping to underpin sentiment into the weekend. The MSCI Asia Pacific Index pared this week's loss today, with China the only main market not participating, despite the PBOC's unexpected injection of CNY200 bln of the Medium-Term Lending Facility.

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FX Daily, November 14: Unexpected German Growth Fails to Buoy the Euro

Overview: Rising trade anxiety and disappointing economic reports from the Asia Pacific region helped unpin the profit-taking mood in equities, while bond yields continued to pullback. The MSCI Asia Pacific Index and the Dow Jones Stoxx 600 are in the red for the fourth time in the last five sessions. Germany reported a surprise 0.1% expansion in Q3, but it has done little for the DAX or the euro.

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FX Daily, November 13: Investors Temper Euphoria

Overview: The recent rise in equity markets and backing up in yields spurred many observers to upgrade their macroeconomic outlooks rather than the other way around. Yet we continue to see may worrisome signs. It is not just trade, though, of course, that is part of it. Sentiment itself is fragile and will likely follow prices.

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FX Daily, November 12: Farage Declares Truce with Tories after being Offered a Peerage, Underpins Sterling

Global capital markets are calm as investors look for a new catalyst. The MSCI Asia Pacific Index snapped back after posting its first back-to-back decline in a month. All the equity markets were higher, but Australia. The Nikkei, Kospi, and Taiex led the advance with about a 0.8% gain. European shares closed firmly near session highs yesterday, even if still lower on the day, and there has been some follow-through buying today.

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FX Daily, November 7: Trade Optimism Boosts Sentiment but Weighs on the Dollar

Indications that a phase one agreement between the US and China would include rolling back some existing tariffs is boosting risking appetites, sending stocks higher, and pushing up yields. However, this appears to be simply a restating of China's views rather than a new breakthrough. The dollar is paring its recent gains. The MSCI Asia Pacific Index rose for the fifth time in six sessions to reach its best level since August 2018.

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FX Daily, November 6: Markets Catch Collective Breath as Dollar Consolidates Yesterday’s Advance

Overview: Investors seem to be catching their collective breath today, and the global capital markets are consolidating recent moves. A notable exception is the Chinese yuan, which has continued to strengthen, and the dollar has slipped back below CNY7.0. Asia Pacific equities were mixed, and the four-day advance in the regional benchmark stalled today.

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FX Daily, November 5: Animal Spirits Remain Animated

The prospects that the US-China deal could include some rolling back of existing US tariffs helped underpin risk appetites. After new record highs in the US S&P 500 and NASDAQ, Asia Pacific markets marched higher, and the MSCI Asia Pacific reached its highest level since August 2018. A small rate cut by China and catch-up by Tokyo, which was on holiday on Monday, helped extended the regional rally for the 14th session in the past 17.

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FX Daily, November 4: Investor Optimism Carries into the New Week

Overview: Investor optimism is reflected by the risk-taking appetite that is lifting equity markets and bond yields. With Japanese markets closed for a national holiday, the MSCI Asia Pacific Index was led higher by more than 1% gains in Hong Kong, Taiwan, South Korea, and Thailand. The regional benchmark advanced for the seventh session in the past eight and is approaching the year's high.

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FX Daily, October 31: No Good Deed Goes Unpunished

Overview: The equity and bond rally in North America yesterday carried over into today's session. With some notable exceptions, like China, Taiwan, Australia, and Indonesia, most bourses in Asia Pacific and Europe traded higher. US shares are little changed in early Europe after the S&P 500 rose to new record highs.

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FX Daily, October 29: Calm before the Storm

The more prominent events this week still lie ahead, and the capital markets are trading accordingly. The rally that lifted the S&P 500 to new record highs yesterday carried over into Asia, where most equity markets rose, though China, Hong Kong, and South Korea were notable exceptions. European shares are struggling in the early going after the Dow Jones Stoxx 600 set new highs for the year yesterday.

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FX Daily, October 22: Trudeau will Lead a Coalition Government in Canada, while the UK’s Johnson Fights Another Day

Overview: Bismark is said to have warned that laws were like sausages, and to respect them, one ought not to see how they are made. The UK had a non-binding referendum more than three years ago, and although it won by 52%-48% and the party leaders committed to adhering to the results, it still cannot figure out how to leave.

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FX Daily, October 17: EU-UK Deal Sends Sterling and the Euro Higher

Overview: A Brexit deal between the UK and the EU has been struck. Whether it can win Parliament's approval is a horse of a different color. Meanwhile, US-Chinese relations continue to sour. The capital markets are narrowly mixed as investors await further developments. The MSCI Asia Pacific is consolidated after gaining for the past four sessions.

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FX Daily, October 15: Non-Disruptive Brexit Hopes Remain Elevated

Overview: Ideas that a Brexit deal may be close is helping to firm sterling, while soft Chinese PPI offset the spike in food prices to show the weakness of the world's second-largest economy. Minutes from the meeting of the Reserve Bank of Australia earlier this month kept a door open to a rate cut before the end of the year.  Japan returned from holiday, and the Nikkei gapped higher, and its nearly 1.9% advance led the MSCI Asia Pacific Index...

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FX Daily, October 11: Nothing Like Approaching the Edge to Focus the Minds

Overview: As the edge of the abyss is approached in three distinct areas, there is hope that victory can be snatched from the jaws of defeat. US-China trade talks continue today, and there is hope of a small deal that could lead to the US not hiking tariffs next week. A shift in the UK toward a free-trade agreement with the EU seems to have opened fertile ground in negotiations that could still avoid a no-deal Brexit.

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FX Daily, October 7: Markets Unsettled to Start the Week

Overview: The global capital markets are uneasy as the risks that have dominated investors' concerns--trade and Brexit--remain front and center today. Expectations are low that this week's talks between the US and China will lead to a breakthrough or will be sufficient to postpone further the next round of tariff increases set for next week. 

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FX Daily, October 4: The US Jobs Data to Close a Sobering Week

Overview: The recovery of US shares yesterday signaled today's fragile stability. Gains in Japan, Australia, and Taiwan blunted the losses elsewhere in the region, including a 1% slide in Hong Kong.  The MSCI Asia Pacific Index fell for the third week. China's markets have been closed since Monday and will re-open Monday and may play some catch-up.

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FX Daily, October 2: Greenback Shows Resiliency, Stocks Don’t

Shockingly poor ISM data sent shivers through the market on Tuesday and hand the S&P 500 its biggest loss in five weeks and took the shine off the greenback. The S&P 500 reached a five-day high before reversing course and cast a pall over today's activity.  All the markets were lower in Asia Pacific, with China and India closed for holidays.

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