A sombre start

16 November, 2015

The events of Friday evening in Paris have cast a sombre tone to European markets, evident in the weaker tone to stocks carried over from the Asia session, with stocks opening around once percent lower. Also causing a more cautious tone in Asia was the weaker GDP data seen in Japan confirming a return to recession in the third quarter. The economy has contracted 0.2% in the previous two quarters, although some modest comfort can be taken from the fact that private consumption recovered in the third quarter after the Q2 weakness. Much of the weakness came from the fall in business investment. The yen initially weakened (USDJPY above the 122.50 level), with the follow through seen during the European session coming on the back of the stronger dollar emerging on the majors. Further quantitative easing from the Bank of Japan looks possible at some point, but some further fiscal stimulus looks more likely in the coming months.

For today, we just have final CPI data for the Eurozone at 10:00 GMT with US Empire Manufacturing later in the day. Note that ECB President Draghi is due to speak at 10:15 GMT in Madrid, with ECB Board member Coeure due to speak in Paris this afternoon. It’s likely that we are going to see the more cautious tone continue for the early part of the week which will favour the dollar and more so against the yen. On the crosses, EURJPY is most likely where the strongest fight will play out, with more dovish rhetoric from the ECB having scope to push it back towards the 130 level, last seen late April.


Source link  
Trump's Tax Reform Plan

US Treasury Secretary Mnuchin announced Trump’s tax reform plan in a press conference...

Corporate Earnings Lift US Stocks

Last week the US President Trump stated on twitter...

Market Concerns Eased

The first-round voting of the French presidential election was revealed on Sunday night...


Dollar Plunged on Trump Second Statement

The dollar index fell to a 2-week low of 99.91 in the early hours...

Markets Eye on the First Trump-Xi Meeting

US President Trump and Chinese president Xi Jinping, are scheduled to meet today at Trump’s Mar-a-Lago resort in Florida...

Will the French Presidential Election affect EUR?

The first round of the French presidential election...


USD Firms Ahead of Q4 GDP Final Reading

The dollar index has rebounded noticeably from a 4-and-a-half-month low of 98.85, helped by outperforming...

Divergence Between Fed and BoJ

The March FOMC meeting will be held for two consecutive days from today. The interest rate decision will be announced at 18:00 GMT on Wednesday 15th March...

Market Volatility Expected Ahead of President Trump's Speech

In a speech that will be watched by millions of viewers in the United States and around the world, the President is expected to speak of his presidency and address pressing issues like his plans for health care, the tax system, the military, and his goals for his administration...

  


Share: