Tuesday 28th July: European Open Briefing

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Tuesday 28th July: European Open Briefing 1

Global Markets:

  • Asian stock markets: Nikkei up 0.20 %, Shanghai Composite fell 1.00 %, Hang Seng rose 1.60 %, ASX gained 0.05 %
  • Commodities: Gold at $1095 (-0.20 %), Silver at $14.59 (-0.10 %), WTI Oil at $47.28 (-0.30 %), Brent Oil at $53.18 (+0.60 %)
  • Rates: US 10 year yield at 2.25, UK 10 year yield at 1.94, German 10 year yield at 0.70

News & Data:

  • China shares gyrate as Beijing scrambles to calm markets – RTRS
  • Asian stocks hit three-week lows as China gloom spreads – RTRS
  • Yen stands tall with Fed, China in focus – RTRS
  • Oil slides to lowest level in four months – FT
  • Oil Extends Decline in Bear Market Amid Signs Glut Will Persist – BBG
  • Europe Shares Post Biggest Five-Day Drop This Year – BBG

Markets Update:

It was a relatively quiet overnight session, with no notable data releases or other events. The focus was on the Shanghai Composite, which yesterday had its biggest down day since 2007, dropping 8.5 %. The index had another weak opening, but managed to bounce and is now down only 1 % on the day.

The move in the Shanghai Composite helped to boost risk appetite and supported the Aussie Dollar. AUD/USD rose from a low of 0.7256 to a high of 0.7320. Next notable resistance lies at 0.7326. A break above that level would pave the way for a test of the 0.74 level. USD/JPY is resilient, with the 123.00 support level still intact. The pair rallied to a high of 123.60 overnight. Intraday resistance lies at 124.00, with 124.40/50 still being the significant resistance area in the short-term.

Looking ahead, the main event of the day will be the UK GDP release at 0930 BST. The market is expecting a 0.7 % print quarter-on-quarter and 2.6 % year-on-year.

Upcoming Events:

  • 08:30 BST – Swedish Retail Sales
  • 09:30 BST – UK GDP
  • 13:30 BST – Canadian RMPI
  • 13:55 BST – US Redbook
  • 14:45 BST – US Services PMI
  • 15:00 BST – US CB Consumer Confidence
  • 15:00 BST – US Richmond Manufacturing Index

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