|Day's range||6,444.40 - 6,500.10|
|52-week range||5,410.20 - 6,500.10|
The RBA talks of rate cuts to pin back the Aussie Dollar as trade war jitters linger. Another quiet day on the stats leaves geopolitical risk in focus.
China is down, but U.S. futures are up early Monday. This is causing a little confusion for traders after sources told CNBC on Friday that scheduling discussions for further trade talks have been put on hold since U.S. President Donald Trump’s administration has increased scrutiny of Chinese telecom companies.
Although China has not announced any retaliatory moves against the U.S. in reaction to the move against Huawei, U.S. firms still took a hit in anticipation of a drop in business. Qualcomm was down 4%, Micron was nearly 3% lower, and semiconductor firms Qorvo and Skyworks were down 7% and 6%, respectively.
A sense of calm in the forex markets early on as the U.S futures point to a positive open in the equity markets. It could all change in a second…
It’s risk off early on as the markets respond to the weekend chatter on trade talks and Asia wakes up to yet another week without a deal…
Trump hits the markets early with the threat of a hike in tariffs and the prospect of more. The latest tweets will distract the markets from the stats.
With stats on the lighter side early on, the focus will be on labor market stats and service sector PMI numbers out of the U.S
The BoE and UK local elections will put the Pound in focus. Stats out of the Eurozone and the U.S and trade talks will also need to be considered.
It’s all eyes on personal spending and inflation figures out of the U.S this afternoon. With the FED delivering on Wednesday, will today’s figures influence?
The Bank of Japan left its key policy rate unchanged on Thursday, while pledging to provide substantial stimulus into 2020 to address slow growth and low inflation. BOJ policymakers also voted to hold its policy at minus 0.1 percent, in line with forecasts.
The steep drop in the Australian Dollar helped export-reliant stocks, such as index-heavyweight drug manufacturer CSL, Ltd., which climbed more than 3 percent to its biggest one-day gain since late December. Lower interest rates tend to drive investors into higher-yielding equity markets.
The Kiwi Dollar and Aussie Dollar take another hit early. The Bank of Canada and corporate earnings could give the Greenback more upside on the day.
It’s a mixed start to the day for the majors. While the Pound managed to hold steady, things could change later today as MPs return from recess.
Consumer sentiment figures out of Germany and Eurozone and industrial production figures out of the U.S will be in focus later today.
China trade figures ease some of the market jitters over the economy. The focus will now shift to earnings to support risk appetite throughout the day.
Lower earnings expectations don’t necessarily mean stock market weakness. First, earnings for the first quarter may actually come out positive. Companies have been issuing guidance, but there is always the chance that they were a little too conservative. Secondly, weaker earnings do not necessarily correlate with a decline in the stock market.
A quiet day on the economic calendar will keep the Pound in focus. Will there be calls for a snap general election?
The International Monetary Fund again slashed its global economic growth forecast for 2019 on Tuesday, citing risks like increasing trade tensions and tighter monetary policy by the Federal Reserve. The U.S. Federal Reserve will release the minutes of its March monetary policy meeting on Wednesday at 18:00 GMT. Investors will be eyeing the FOMC minutes to determine just how dovish central bank policymakers really are after last month’s policy shift.
Given that wall of uncertainty, a little setback may be necessary as investors seem to be a little reluctant to buy strength at current price levels. Instead, they may be willing to let a little air out of the rally in an effort to drive prices into a value zone.
Brexit remains the headline topic for the broader markets. The EUR may have found support early in the week, but Draghi may address that tomorrow.
The tone remains positive, but investors may be growing a little tired of the day-to-day commentary, and are likely desiring something more concrete like the announcement of the deal that finally ends the trade dispute. President Trump said last week that a deal may be about four weeks away.
Economic data is on the lighter side through the day. The lack of stats will leave the markets eyeing Parliament and the Pound. Can Theresa May deliver?
Household spending out of Japan disappointed early. While there will be support from trade talks, the data out of Europe and the U.S will influence.