Market News Today – USD pressured again (USDIndex struggles @ 92.00) on weak data yesterday, and virus surge in Southern low-vaccination rated states. JPY & CHF benefit – Yields lead – down again; 10yr 1.74%. Equities flat into close (USA500 4387). Oil dumps -3.5% (CAD sinks). 

RBA more Hawkish than expected – AUD rallied – September taper looks set. Although cautious undertones remains and concerns over housing market and virus & vaccination situation. Chinese & Asian stock markets very mixed after more Chinese clampdowns this time on Gaming and virus surge in China. Fed’s WALLER (Hawk) suggests taper announcement in September. Overnight data mixed better CPI for Tokyo weaker Housing approvals for AUD. Gold holds at 1808 but USOil also down significantly to test 70.00, yesterday 30 cents higher now. 

European Open – The September 10-year Bund future is fractionally higher, US futures marginally lower, while in cash markets the 10-year Treasury rate is struggling at 1.176%. The real 10-year Treasury yield remains close to a record low. DAX and FTSE100 futures are down -0.2% and -0.1% respectively, US futures up 0.2-0.3% after a largely weaker session in Asia. With little on the European calendar to distract markets those will likely also be the themes for the European AM session, alongside earnings reports. The BoE decision tomorrow is also coming into view with the UK expected to join Fed and ECB and signal cautious patience for now.

Today – US Factory Orders, Fed’s Bowman, – Earnings: Generali, Societe Generale,  BMW, Infineon, BP, Standard Chartered, Alibaba, Phillps 66, Eli Lilly, ConocoPhillips.

Biggest FX Mover @ (06:30 GMT) NZDCAD (+0.19%) Has moved up from 0.8680 (14 day low yesterday) as Oil prices tumbled and NZD got a lift from Hawkish RBA. Significant breach of 21 EMA yesterday, Faster MA’s aligned higher, MACD signal line & histogram over 0 and moving higher, RS 78 and well into OB zone. H1 ATR 0.0011, Daily ATR 0.0060.

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Stuart Cowell

Head Market Analyst

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