Market News Today – USD (USDIndex 93.32) ticks lower again today, but holds significantly over 93.00. Yields (10yr 1.26%) are lower as Asian stock markets markets follow US higher. (USA500 closed +0.81% @ 4441 & FUTS trade at 4451 now). Weekend – Afghanistan situation continues to hold, Biden issues EO on some Russian pipeline sanctions, Delta variant remains a significant concern and Japanese PM Suga suffers major reverse in local elections. Overnight – AUD & JPY PMi’s miss expectations USOil up from 7-day fall to 61.35 on Friday to $62.85 and Gold holds at $1785.
European Open – The September 10-year Bund future is down -15 ticks, US futures are also retreating as risk appetite stabilises. Easing tapering concerns have helped to underpin demand for and DAX and FTSE 100 futures are up 0.7%, U.S. futures around 0.4%. Japan’s PMI readings pointed to an acceleration in the pace of contraction and while European readings are expected to remain firmly in expansion territory, there is the risk that rising cases and questions over the efficacy of vaccines will weigh on services sentiment in particular, while the manufacturing sector continues to struggle with supply chain disruptions and capacity constraints. The announcement that Jackson Hole is held as a virtual event will go some way to keep at least hope in ongoing central bank support alive. “The shift away from an in-person gathering, reflects a much more cautious Fed, which in turn suggests the Fed will not be announcing a path on QE tapering as soon as Jackson Hole, and likely not in September.” – Action Economics
Today – EZ, UK, US Flash PMIs, US Existing Home Sales.
Biggest Mover @ (06:30 GMT) USOil (+1.90%) Breaks 7-day losing streak, currently up from 61.35 low on Friday to trade over $63.00 today. Currently back to $62.85. Faster MA’s aligned higher, MACD signal line & histogram below 0 but rising and testing this level. RSI 55.6 and rising, MFI 110 and significantly OB. H1 ATR 0.35, Daily ATR 2.15.
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Stuart Cowell
Head Market Analyst
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