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Financials Weaken in Europe Building Additional Dollar Strength
September 30, 2008 5:03 PM CEST
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G10 Advancers and Decliners vs USD |
 | Nzd | -0.12 | | | Gbp | -0.99 | | | Aud | -1.20 | | | Cad | -1.42 | | | Nok | -1.70 | | | Jpy | -1.74 | | | Sek | -2.44 | | | Eur | -2.53 | | | Dkk | -2.53 | | | Chf | -2.69 | |
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Global Indexes |
Current Level |
% Change |
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| DJIA Index | 10,630.83 | + 2.56 | | NASDAQ 100 Index | 2,045.43 | + 3.11 | | S&P 500 Index | 1,141.99 | + 3.22 | | FTSE futures | 4,937.00 | + 1.05 | | CAC futures | 4,011.00 | + 0.96 | | DAX futures | 5,861.00 | - 0.23 | | SMI Futures | 6,664.00 | + 1.76 |
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World Markets |
Current Level |
% Change |
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| Crude wti | 99.64 | + 3.39 | | Gold | 878.15 | - 3.45 | | Silver | 12.36 | - 5.86 | | USD Index | 79.22 | + 2.26 | | VIX | 40.32 | - 13.70 |
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Todays Calender |
Estimates |
Previous |
Country / GMT |
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| No Major Events Scheduled | | | |
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Currency Tech |
AUDUSD
R 3: 0.8469
R 2: 0.8380
R 1: 0.8348
CURRENT: 0.8061
S 1: 0.7935
S 2: 0.7802
S 3: 0.7676
EURJPY
R 3: 155.30
R 2: 153.01
R 1: 151.72
CURRENT: 150.68
S 1: 148.84
S 2: 147.51
S 3: 147.04
USDSGD
R 3: 1.4478
R 2: 1.4373
R 1: 1.4355
CURRENT: 1.4273
S 1: 1.4238
S 2: 1.4184
S 3: 1.4054
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Market Brief |
The Usd carried yesterday’s gains in the early US session as overall market volatility spiked following the failure of the Fed bailout proposal. The EurUsd declined over 200 pips to the low 1.42 level, while the UsdJpy rose 130 pips to the mid range of 105. The GbpUsd slid an additional 80 pips following yesterday’s losses, finding support at the 1.80 price area. Equity markets began to recover following the largest one day drop in history with the Dow falling 777pts. Today the Dow is up a little over 200pts, while the FTSE, CAC, and DAX are marginally positive. Commodities are mixed with oil up 2% at 98, while gold slid 3% to 882 following the rally in the previous trading session. Bond yields are beginning to widen, but the 2yr remains below 2% which is extremely tight and represents the heavy buying of more secure assets.
Eurozone inflation fell from 3.8% to 3.6% exp. giving the ECB more room to ease rates by Q109. This is a major driver in the Eurodollar selling, as easing energy prices are likely to keep inflation constrained. Outside of the weaker inflation story, the bank bailouts have hit Europe as well, with the governments of Belgium and France extending $9.2bln to a troubled bank, while the Irish Govt. stated that they would guarantee all deposits and debts of Irish banks. News out of the UK was light, but the cable continues to weaken, as the weak housing data released yesterday suggest further pain has yet to be realized in the current price. We remain bearish on the sterling with a trading range between 1.81-1.77, out bias is to the downside based on UK economic conditions.
US financial markets reached exceptionally high levels of volatility with the VIX well above $40 yesterday.
The equity markets tanked, and bond prices soared, while FX seemed to have taken its own direction focusing more on the global economic outlook and the full scope of activity in interest rate and capital markets. We project dollar strength to pickup in the long-term but the near-term outlook should be turbulent with a trading range between 1.39-1.43 with a bias to the downside.
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Asian Session - Markets Contemplate What's Next - Equities Under pressure
September 30, 2008 10:02 AM CEST
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G10 Advancers and Decliners vs USD |
| | JPY | 0.38 |  | | | GBP | 0.24 | | | | NOK | 0.12 | | | CHF | -0.05 | | | EUR | -0.13 | | | DKK | -0.16 | | | NZD | -0.17 | | | SEK | -0.41 | | | AUD | -0.83 | | | CAD | -0.92 | |
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Global Indexes |
Current Level |
% Change |
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| Nikkei 225 Index | 11,259.86 | - 4.11 | | Hang Seng Index | 17,674.92 | - 1.15 | | Shanghai Index | 2,293.78 | - 0.16 | | FTSE 100 Index | 4,743.72 | - 1.55 | | CAC 40 Index | 3,900.25 | - 1.34 | | SMI Index | 6,442.01 | - 0.89 | | DJIA futures | 10,668.00 | + 1.85 |
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World Markets |
Current Level |
% Change |
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| Gold | 898.20 | - 1.39 | | Silver | 12.98 | - 1.18 | | VIX | 46.72 | + 34.48 | | Crude wti | 94.38 | - 2.02 | | USD Index | 77.86 | + 0.49 |
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Todays Calender |
Estimates |
Previous |
Country / GMT |
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| Case-Shiller 20-City House Price Index (Jul) | -16.0% | -15.9% | US / 13.00 | | Industrial Product Price m/m | -0.3 | 0.4 | CA / 13.30 | | Chicago PMI (Sep) | 53.0 | 57.9 | US / 13.45 | | Conference Board Consumer Conf. Index (Sep) | 55.0 | 56.9 | US / 14.00 | | GDP m/m (aug) | 0.2% | 0.1% | CA / 13.30 |
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Currency Tech |
AUDUSD
R 3: 0.8469
R 2: 0.8380
R 1: 0.8348
CURRENT: 0.8061
S 1: 0.7935
S 2: 0.7802
S 3: 0.7676
EURJPY
R 3: 155.30
R 2: 153.01
R 1: 151.72
CURRENT: 150.68
S 1: 148.84
S 2: 147.51
S 3: 147.04
USDSGD
R 3: 1.4478
R 2: 1.4373
R 1: 1.4355
CURRENT: 1.4273
S 1: 1.4238
S 2: 1.4184
S 3: 1.4054
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Market Brief |
The Usd was stronger in the Asian session, after one of the worst sessions on Wall Street in history. The EurUsd traded down to 1.4360 after a brutal spike to 1.4570, as the US House of Representatives rejected the Bailout plan. The Jpy was the big gainer across the board, as traders looked to pair down risk. The UsdJpy broke the 105.00 lvl trading down to 104.53. Asian stock markets are lower following the collapse on Wall Street, with the Nikkei leading the losers -4.11%. European futures are point to another torrid day with the FTSE -5.09%. Crude is trading lower at $94.23bll while gold is slightly higher at $902.08oz. The markets will be waiting anxiously to see if an amended bill can be passed when the House returns from holiday on Wednesday. The plan was defeated 205 to 228 in what we see as primarily political wrangling and expect later this week a compromise to be reached.
Considering the overall volatility in markets, FX has been relatively subdued. However, fx implied vols are reaching very high levels, as traders are expecting a significant move. Today, market participants will be watching the equity markets for any change in sentiment.
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ACM Advanced Currency Markets SA (hereinafter referred as ACM) is a professional financial intermediary, directly regulated by the Swiss Federal Department of Finance, Anti Money Laundering Control Authority. As forex specialist, ACM provides only currency trading via highly professional forex trading software. All customers are aware that this information or any part thereof has been prepared without taking account of your objectives, financial situation and/or needs. This information is not intended as personalized investment advice and does not constitute a recommendation. It is not an offer or solicitation of any offer to purchase or sell any financial instrument. The analysis is based on the information which ACM finds reliable and accurate, but ACM does not assume any responsibility for any material nor for the transactions made on the basis of the information or the estimates of the analysis. ACM cannot guarantee that these forecasts will materialize and cannot be held liable in any way for direct, indirect and/or consequential loss arising from any use of this information, document or its content. All opinions and estimates constitute ACM analysis as of the data and are subject to change without notice. ACM does not warrant the accuracy or completeness of information contained herein, such information is subject to change and is not intended to influence your investment decisions. Past performance is not a reliable indicator of future performance.
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