Macro: Sandcastle economics
Invest wisely in Q3 2024: Discover SaxoStrats' insights on navigating a stable yet fragile global economy.
FX Trader, Loonieviews.net
Summary: The fear that stalked Wall Street yesterday has abated but even though advances are being made there remains much to recover.
Risk sentiment has improved since the Asia markets closed. European Central Bank President Mario Draghi’s press conference was benign. Wall Street is opening in positive territory but still has a long way to go to recover from yesterday’s meltdown. The US dollar extended European gains in New York except against the antipodean’s, which have inched higher.
The ECB did as expected and left policy and guidance unchanged. The statement repeated that Eurozone rates are staying parked until the summer of 2019. Draghi suggested that the ECB would provide improved clarity on its outlook at the December meeting when updated forecasts would be available. EURUSD touched 1.1431 before the press conference and was trading at 1.1375 at 14:00 GMT.
Sterling has been hammered again. GBPUSD triggered weak stop losses on this morning’s break of support at 1.2880 and traded at 1.2842 at 14:00 GMT. The rising risk of a ‘no-deal” Brexit is behind the move.
US September Durable Goods Orders surged 0.8% (forecast -0.9%), and Initial Jobless claims rose to 215,00, which helped support the early Wall Street gains.
Wall Street seemed pleased with yesterday’s strong earnings reports from Tesla (TSLA: Nasdaq) AMD: Nasdaq and Visa (v: NYSE) after the close yesterday and with the bounce in European equities. Better than expected US economic data, helped. The Dow Jones Industrial Average is up 0.75%, S&P 500 has gained 1.08%, and the Nasdaq has gained 1.88% as of 14:20 GMT. Microsoft (MSFT: xnas) reported earnings per share of $1.14, well above the $0.99 that was forecast, which bodes well for Alphabet (GOOGL: Nasdaq) and Amazon (AMZN: Nasdaq) quarterly reports at the close of business today.
Disclaimer
The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.
Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-gb/legal/disclaimer/saxo-disclaimer)