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Markets Update: APAC Stocks Mixed Amid Chinese Profit Rebound; European Equity Futures Point to Contained Open; US Senate Clears Spending Bill Hurdle.
Economic Calendar
Global Markets Roundup: 27 Sep 2023
APAC stocks traded mixed on Wednesday, with a rebound in Chinese industrial profits partially offsetting the subdued handover from Wall Street. European equity futures are indicative of a contained open, with the Euro Stoxx 50 future flat after the cash market closed down 0.9% on Tuesday.
The US Senate voted to clear a procedural hurdle of the Senate bipartisan bill to avoid a shutdown. House Speaker Kevin McCarthy said a stopgap funding bill will be brought to the House floor on Friday.
The US dollar index (DXY) is steady around the 106 handle, while the euro (EUR) remains sub-1.06, USD/JPY lingers around 149, and the antipodeans lag.
The ASX 200 was lower, albeit with downside stemmed as participants digested the monthly CPI data from Australia, which matched expectations at 5.2% Y/Y but accelerated from the prior. The Nikkei 225 initially underperformed and briefly dipped below 32,000 before bouncing off lows.
FX
The US dollar index (DXY) was steady around the 106 handle, holding on to the prior day's gains after climbing to a 10-month high.
The euro (EUR) remained subdued after its recent failure to hold on to the 1.0600 handle and with the latest ECB rhetoric doing little to spur the currency.
The British pound (GBP) languished at a 6-month low due to the recent dollar strength.
The Japanese yen (JPY) was indecisive and oscillated in a thin range around the 149.00 level following a lack of surprises from the outdated minutes of the BoJ's July meeting.
The AUD and NZD ultimately weakened, although price action was choppy following the whipsawing in CNH, which was briefly supported by several factors, including the PBoC meeting, Chinese industrial profits, and Chinese state banks selling dollars in the onshore market to boost the yuan.
The PBoC set the USD/CNY mid-point at 7.1717, weaker than the expected 7.3103.
Chinese state banks were said to be selling dollars onshore to boost the yuan.
The RBI likely sold dollars in the NDF market at around 83.24-83.25 ahead of the spot market open, according to traders cited by Reuters.
FIXED INCOME
10-year US Treasury futures nursed some of their recent losses with some slight reprieve during Asian trading hours as yields marginally eased. The threat of a shutdown lingers, with House Speaker McCarthy to bring a stopgap funding bill to the House floor on Friday.
Bund futures rebounded mildly to test the 129.00 level, where they were met with resistance.
10-year JGB futures were kept afloat amid the BoJ's presence in the market for nearly JPY 1.5tln of JGBs on top of its fixed-rate operations.
COMMODITIES
Crude futures extended on yesterday's rebound despite the lack of catalysts and with the energy complex also unfazed by the surprise build of oil stocks in the latest private sector inventory report.
US Energy Inventory Data (bbls): * Crude +1.6mln (exp. -0.3mln) * Gasoline -0.1mln (exp. -0.1mln) * Distillates -1.7mln (exp. -1.3mln) * Cushing -0.8mln
The US is postponing the Gulf of Mexico oil and gas lease sale that was scheduled for September 27th.
Spot gold trickled beneath the USD 1900/oz level amid the recent dollar strength.
Copper futures traded sideways alongside the mixed risk appetite in the region.
Looking Ahead
German Gfk consumer sentiment
Czech National Bank policy announcement
Supply from the UK, Germany, and US
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team
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