Friday 13th November: European Open Briefing

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Global Markets:

  • Asian stock markets: Nikkei down 0.70 %, Shanghai Composite fell 1.15 %, Hang Seng declined 2.30 %, ASX dropped 1.30 %
  • Commodities: Gold at $1082.90 (+0.18 %), Silver at $14.27 (+0.05 %), WTI Oil at $41.55 (-0.47 %), Brent Oil at $45.25 (+0.18 %)
  • Rates: US 10 year yield at 2.32, UK 10 year yield at 2.01, German 10 year yield at 0.62

News & Data

  • Japanese Industrial Production (MoM) Sep, F: 1.1% (flash 1.0%)
  • Japanese Industrial Production (YoY) Sep, F: -0.8% (flash -0.9%)
  • Japanese Capacity Utilisation (MoM) Sep: 1.5% (prev -0.9%)
  • Japanese Tertiary Industry Index (MoM) Sep: -0.4% (exp 0.1% prev 0.1%)
  • PBoC Fixes Yuan Reference Rate At 6.3655 (prev 6.3628)
  • Fed Vice Chair Fischer: Liftoff Decision Depends On Progress On Fed Goals — BBG
  • Fischer: US Economy Weathering Headwinds From Stronger Dollar
  • Fischer: Dollar Also Responding To Concern About Global Outlook
  • Fischer: Oct. FOMC Signalled Dec. Rate Rise May Be Appropriate

Markets Update:

The US Dollar strengthened against most major currencies overnight, as it benefited from the risk-off sentiment and sell-off in equity markets. EUR/USD reached a high of 1.0830 ahead of the Sydney open, but ran out of momentum and fell back to 1.0785 in Asia. Similar price action was seen in GBP/USD, which failed to break through 1.5240 resistance twice yesterday. USD/JPY fell to 122.49 overnight, as the Yen caught a bid. There are reports of bids in decent size in the 122.20/25 area and the next major technical support level is 122.00, which is the pre-NFP high.

AUD/USD is holding relatively well. It had a brief dip sub-0.71 in yesterday's NY session, but recovered from there and traded as high as 0.7140 in Asia. 0.7150 remains a tough resistance level, but a break above it would signal a move towards 0.7220.

Looking at the economic calendar, there are plenty of data releases today, but the main event will be US retail sales at 13:30 GMT. The market is expecting a 0.3 % rise month-on-month, while core retail sales is expected to rise 0.4 %.

Upcoming Events:

  • 06:30 GMT – French GDP
  • 07:00 GMT – German GDP
  • 10:00 GMT – Italian CPI
  • 10:00 GMT – Euro Zone GDP
  • 10:00 GMT – Euro Zone Trade Balance
  • 13:30 GMT – US Retail Sales
  • 13:30 GMT – US PPI
  • 15:00 GMT – US Business Inventories
  • 15:00 GMT – US Michigan Consumer Sentiment

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