Yesterday was a rather calm day, lacking the US drive, and as the hours passed it partially soured. The European indices all finished slightly in the red, however no more than -0.24% on the FRA40, while the only significant figure from the Eurozone – apart from the Sentix Investor Confidence still nosediving – was the German trade balance’s -15% m/m decline led by the fall in exports, which was however smaller than expected; exports to China are down -16.5% YTD (Eur 57.7 billion). On her part, Lagarde cleverly avoided answering questions about future monetary policy in her speech in London.
A short while ago, the RBA left its cash rate unchanged at 4.1% as expected, the third consecutive month of pause, weighing on AUD’s performance, but it is all the Asian currencies that are weak. The Chinese Caixin Services PMI – while still in expansionary territory – posted its worst reading in nine months (51.8 down from 54.1) and this comes after some other if not certainly good, at least hopeful manufacturing statistics last week. However, the whole of APAC is in the red despite Country Garden managing to avoid its first default. US futures are also -0.1% on average at the moment. UBS expects clear signs of a US economic slowdown in November, bringing an end to the Fed’s tightening cycle.
- FX – USDIndex still strong at 104.19, AUDUSD underperforms (-0.66% at 0.6418), USDJPY faces 147 (146.82 now), USDCNH 7.29, EURUSD -0.11% at 1.0784, Cable -0.07% at 1.2619.
- Stocks – China 50 -0.56, AUS200 -0.25%, GER40 set to open -0.22% at 15789; US Futures: US500 -0.07%, US100 -0.03%, US30-0.10%.
- Commodities – USOil at a 10 month high @ $85.87, UKOil @ $88.88. Copper continues correcting, -0.67% at $382.40.
- Gold – below $1940, at $1937.25. Silver – 0.65% at $23.82.
LATER TODAY: HCOB PMIs Services & Composite in DE, FR, IT, SP, EU, European PPI, US Redbook and Factory orders, Lagarde speech.
INTERESTING MOVER: BTCUSD -0.79% in the last 24h at 25726 keeps hovering around the crucial 25250 area that happens to be also the 200d MA; it has recently lost its 2023 ascending channel and retested from the downside last week, being brutally rejected.
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Marco Turatti
Market Analyst
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