Global Markets:
- Asian stock markets: Nikkei up 1.40 %, Shanghai Composite gained 0.60 %, Hang Seng rose 0.50 %, ASX 200 rallied 1.00 %
- Commodities: Gold at $1328 (+0.35 %), Silver at $19.32 (+1.05 %), WTI Oil at $47.05 (-0.05 %), Brent Oil at $49.10 (-0.30 %)
- Rates: US 10 year yield at 1.58, UK 10 year yield at 0.68, German 10 year yield at -0.13
News & Data:
- Japan Retail Sales (MoM) Aug: -1.1% (est. -0.60%, prev. 1.50%)
- Japan Retail Trade (YoY) Aug: -2.1% (est. -1.70%, prev. -0.20%)
- Australia Job Vacancies (QoQ) Aug: 4.6% (prev. -1.90%)
- PBOC sets USD/CNY mid-point at 6.6700 (prev. fix 6.6681, prev. close 6.6750)
- RBNZ: NZD exchange rate is too high; RBNZ remain vigilant regarding risks, especially with regard to housing imbalances
- OPEC agrees modest oil output curbs in first deal since 2008 – RTRS
- Commodity currencies firm, yen sags after OPEC oil curb agreement – RTRS
Markets Update:
Risk assets rallied overnight after the OPEC announced that it agreed on cutting output. This pushed oil prices up more than 4 % on the day, and led to a rally in global equity markets. FX was also affected, as the Japanese Yen plunged and commodity currencies rallied across the board.
AUD/USD rallied from 0.7645 in yesterday's NY session to a high of 0.7710 in Asia. The topside was capped there for now, but the Australian Dollar remains well bid and techs point to further gains. 0.7750/60 are the key levels that AUD/USD has to take out; beyond that area, there is not much resistance until 0.80.
USD/CAD has been under heavy pressure as the Canadian Dollar was supported by the rally in Oil. The pair fell from 1.3260 to a low of 1.3050 in Asia. Resistance is now seen at 1.3120 and 1.3180, while the next major support level lies at 1.30.
USD/JPY rallied along with equities and reached a high of 101.50. Decent offers lie ahead of the 102.00 level, but the effects of the OPEC deal and improvement in risk appetite should keep it supported in the short-term.
Upcoming Events:
- 08:00 BST – Spanish CPI
- 08:55 BST – German Unemployment Rate
- 10:00 BST – Euro Zone Consumer Confidence
- 13:00 BST – German CPI
- 13:30 BST – US GDP
- 13:30 BST – US Initial Jobless Claims
- 15:00 BST – US Pending Home Sales
