Good morning
Stock markets are in turmoil, US equities closed down around 3% yesterday as markets turn fearful of a hard landing following recent weak data from the US, despite the fact yesterdays ISM release beat expectations. Mind you, this morning EU/UK equities have opened higher, futures pricing shows a bit of a recovery in US stocks as well, while overnight Japan’s Nikkei rose over 10%, not quite eclipsing yesterdays losses but a strong step in the right direction.
In terms of currencies, GBP is still struggling against USD and EUR, at 1.2750 and 1.1655 respectively, EURUSD currently 1.0940 having briefly broken above 1.1000 yesterday to reach the highest levels since the start of Jan this year. USDJPY has tracked Nikkei to some extent, now 145.80 having traded as low as 141.80 yesterday afternoon, at the peak of the equity and USD sell-off. GBPJPY back up to 185.75. Who would want to be a yen trader right now?
RBA did keep rates unchanged earlier this morning as widely expected. Their forecasts suggest inflation reaching 3.5% by the end of 2024, then reaching its 2-3% target band by end-2025. AUD is broadly unchanged following the announcement, at 0.6500, 1.0975 and 1.9590 against USD, NZD and GBP, if anything a touch higher overall as RBA all but rule out any near-term rate cuts.
In other news, three water companies have been fined £168m, the bulk of which goes to Thames Water, following what Ofwat described as a catalogue of errors over raw sewage releases. You know I have no time for water companies, I think their actions have verged on criminal over the years, but I fail to see what a fine is going to achieve other than ultimately higher bills for the public.
Congratulations to GB’s Hodgkinson who ran a superb race to take gold in the women’s 800 metres yesterday. Meanwhile, Polish speed climber Miroslaw broke her own world record yesterday with a time of 6.06 seconds for what I think is a 15 metre wall. Worth a watch if you didn’t see it.
This seems like a short report with all the volatility in the markets but I’ll leave it there for now. Now much on the calendar today, although NZ unemployment will be closely watched by RBNZ, a higher unemployment rate is expected which could encourage a rate cut by RBNZ earlier than the November currently pencilled in.
Have a great day
- 10.00 EU retail sales
- 23.45 NZ unemployment
- 04.00 China trade balance
Have a great day
- 10.00 EU retail sales
- 23.45 NZ unemployment
- 04.00 China trade balance
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