Market Blog > October 2016 > Market Review

Market Review

BOJ’s Governor Kuroda stated that he did not observe any direct damage to Japan’s banking sector due to the Central Bank’s negative interest policy. Data showed that Japan’s Monetary Base fell more than expected to 22.7% from 24.2% in the previous month. The household confidence in Japan according to the Cabinet Office rose from 42.0 to 43.0 in the preceding month.

The chief economist of the European Central Bank stated that the ECB is determined to maintain its interest rates low until it gets inflation back to its target. Eurostat in its report stated that the Euro zone price inflation went down more than it was anticipated from 0.3% to 0.2%. Official data stated that the construction sector activity of the United Kingdom has increased unexpectedly last month. In a report, CIPS said that U.K. Construction PMI went up to 52.3, from 49.2 in the previous month.

The International Monetary Fund slashed its estimate for growth in the U.S. economy in 2016 based on an unsatisfactory performance in the first half of the year. IMF’s chief Economist Maurice Obstfeld sated that the U.S economy in not in danger of overheating and that the FED should continue its approach to another interest rate hike.

Currencies: The dollar was mostly higher against other major currencies on Tuesday due to optimistic U.S. data which supported the case of the FED for a rate hike. The EURUSD traded lower between $1.1239 and $1.1138. The GBPUSD traded lower between $1.2860 and $1.2720. The USDJPY traded higher between ¥101.58 and ¥102.97.

Crude oil: Oil prices went down on Tuesday balanced by a stronger U.S. dollar, on the other hand the commodity continued to be supported as the oil production freeze deal announced last week by OPEC continued to increase investors’ confidence. On the ICE future Exchange, North Sea Brent crude traded lower between $51.34 and $50.34. On the New York Mercantile Exchange, U.S. light crude oil traded lower between $49.13 and $48.27.

Gold: Gold prices went down on Tuesday, as a stronger U.S. dollar resulting from the recent upbeat U.S data continued to weigh on the precious metal. On the COMEX division of the New York Mercantile Exchange, gold traded lower in a range between $1313.02 and $1266.77 an ounce.

Indices:  Asian shares shook off a sluggish start and pushed higher on Tuesday. At the close in Tokyo, the Nikkei 225 advanced 0.83%. In China, Shanghai Composite was closed as markets are shut for a week-long holiday.

European stocks opened higher on Tuesday although gains were anticipated to be limited as markets turned their attention to Deutsche bank and concerns over a potential hard Brexit. At the close in Frankfurt the DAX added 1.03%. At the close in Paris, the CAC40 went up 1.11%. At the close in Madrid, the IBEX 35 added 0.20%. Finally, at the close in London the FTSE100 advanced 1.30%.

U.S. stocks fell on Tuesday as investors are worried about the U. K’s exit from the European Union and the prospect of a Federal Reserve interest rate hike in the upcoming months. At the close, the Dow Jones industrial average lost 0.47%. The S&P 500 went down 0.54% and the NASDAQ composite declined 0.21%.

Economic Calendar
Wednesday 5th October 2016:
 

Time

Currency

Events

Forecast

Previous

 8:30am

GBP

Services PMI

52.1

52.9

12:15pm

USD

ADP Non-Farm Employment Change

166K

177K

12:30pm

CAD

Trade Balance

 

-2.5B

12:30pm

USD

Trade Balance

-41.1B

-39.5B

2:00pm

USD

ISM Non-Manufacturing PMI

53.1

51.4

2:00pm

USD

Factory Orders m/m

-0.40%

1.90%

2:30pm

USD

Crude Oil Inventories

 

-1.9M

Posted: 10/5/2016 6:44:20 AM by Global Administrator | with 0 comments


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