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Europe Roundup: Sterling slips ahead of vote on new UK tax, European stocks fall, Gold edge higher, Oil climbs on slow U.S. supply return after Hurricane Ida-September 8th,2021

Posted at 08 September 2021 / Categories Market Roundups


Market Roundup

•French Non-Farm Payrolls (QoQ) (Q2) 1.1%,1.2% previous

•French Jul Trade Balance -7.0B  , -5.8B previous

•French Jul Current Account -3.50B forecast, -0.50B  previous     

•Sweden Jul Industrial New Orders (YoY) 13.5%,24.4% previous  

•Italian Jul Retail Sales (MoM) -0.4%,0.7% previous

Looking Ahead –Economic Data (GMT)

•12:55 US Redbook (YoY) 18.6% previous

•14:00 US IBD/TIPP Economic Optimism 53.6 previous

•14:00 Canada BoC Interest Rate Decision  0.25% forecast, 0.25% previous

•14:00 Canada Aug Ivey PMI n.s.a  59.8 previous

•14:00 US Jul JOLTs Job Openings 10.000M forecast, 10.073M previous

•14:00 Canada Aug Ivey PMI 56.4 previous

Looking Ahead - Events, Other Releases (GMT)

17:10 FOMC Member Williams Speaks

•14:00 Canada BOC Press Conference

Fxbeat

EUR/USD: The euro dipped against the dollar on Wednesday ahead of European Central Bank policy decision.Fed Chair Jerome Powell has suggested an improvement in the employment numbers is the remaining major prerequisite for action, and such a move could damage risk appetite. Investors are wary of the ECB meeting on Thursday, anticipating a potential trim to the PEPP (Pandemic Emergency Purchase Programme) bond-buying pace.Analysts polled see PEPP purchases falling possibly as low as 60 billion euros a month from the current 80 billion, before a further fall early next year and the scheme's end in March. The euro slipped 0.05% to $1.1836 for the first time since Sept. 2. Immediate resistance can be seen at 1.1835 (50%fib), an upside break can trigger rise towards 1.1865(38.2%fib).On the downside, immediate support is seen at 1.1809(Daily low), a break below could take the pair towards 1.1803 (61.8%fib).

GBP/USD: Sterling fell for the third straight day on Wednesday, with the U.S. dollar broadly stronger and investors digesting the British government's announcement of a tax hike to fund health spending and social care.Lawmakers will vote on Prime Minister Boris Johnson's tax proposals, which raise the overall tax burden to the highest in decades. The pound extended its fall on Tuesday after the announcement. Analysts said higher taxes could slow the economic recovery, but more importantly for the pound may ease pressure on the Bank of England to begin tightening monetary policy.By 0800 GMT, sterling was 0.1% lower at $1.3767. Immediate resistance can be seen at 1.3799(38.2%fib),an upside break can trigger rise towards 1.3856 (23.6%fib).On the downside, immediate support is seen at 1.3752(50%fib), a break below could take the pair towards 1.3703(38.2%fib).

 USD/CHF: The dollar strengthened against the Swiss franc on Wednesday as dollar was buoyed by higher Treasury yields. The benchmark 10-year Treasury note rose as high as 1.385% on Tuesday for the first time since mid-July, a climb of almost 6 basis points from Friday's close. Monday was a U.S. holiday. Investors will look to a speech by New York Fed President John Williams later on Wednesday for any hints on whether the labour market is still on the Fed's stated path of "substantial further progress" needed for a taper. Immediate resistance can be seen at 0.9213 (23.6%fib), an upside break can trigger rise towards 0.9238 (Aug 13th high).On the downside, immediate support is seen at 0.9181(Daily low), a break below could take the pair towards 0.9161(38.2%fib).

USD/JPY: The dollar strengthened against yen on Wednesday as investors awaited clues from major central banks on their stimulus tapering measures. Accommodative central bank policies and optimism about reopening economies has pushed dollar higher, but concerns are growing about the impact of rising coronavirus infections due to the Delta variant. The dollar index , which measures the currency against six rivals, ticked up 0.05% to 92.580, after earlier touching 92.590, a level not seen since Sept. 1 .Strong resistance can be seen at 110.42(23.6%fib), an upside break can trigger rise towards 111.00(Psychological level).On the downside, immediate support is seen at 110.10(38.2%fib), a break below could take the pair towards 109.82(50%fib).

Equities Recap          

European stocks fell on Wednesday as worries about slowing global growth weighed on sentiment, while investors looked ahead to a European Central Bank meeting for hints on tapering plans.

At (GMT 11:02),UK's benchmark FTSE 100 was last trading down at 0.44% percent, Germany's Dax was down by 0.63%percent, France’s CAC finished was down by 0.36% percent.

Commodities Recap                                  

Gold prices edged higher on Wednesday after a steep fall in the previous session, as concerns about global growth slowdown weighed on risk sentiment while investors awaited the European Central Bank’s tapering strategy.

Spot gold was up 0.2% at $1,797.30 per ounce by 0934 GMT, after falling to an over one-week low of $1,791.90 on Tuesday. U.S. gold futures were steady at $1,799.20.

Oil prices rose on Wednesday as U.S. Gulf of Mexico producers made slow progress in rebuilding output, although gains were capped by a stronger dollar and concerns about the impact on demand of rising coronavirus infections.

Brent was up 60 cents, or 0.8%, at $72.29 a barrel, at 1002 GMT, and U.S. West Texas Intermediate (WTI) crude rose 70 cents, or 1%, to $69.05 a barrel.


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