Sunday , September 22 2019
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Tag Archives: $SPX

Look for Yuan Weakness and Yen Strength to Begin the Week

The Japanese yen and Canadian dollar were the only major currencies to gain against the US dollar last week.  They are also the only major currencies to appreciate against the dollar so far this year.  US President Trump's apparent playing down of the pressure to strike a partial deal with China before the 2020 election weighed on stocks and lifted the so-called safe-haven currencies ahead of the weekend.  When everything was said and done, from the attack on Saudi Arabia to the money...

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Jump in Yields Didn’t Derail Equity Rally While Sterling Rallies Ahead of the Weekend on (misplaced) Brexit Optimism

The most striking thing about last week's price action was the surge in US yields.  The 10-year yield jumped about 34 basis points, the most in three years and returned to levels not seen since August 2 (1.90%).  A deluge of investment-grade corporate bonds and US Treasuries ($78 bln auctioned to lukewarm reception), coupled with an acceleration of core CPI (highest in 11 years), optimism on the trade front, and Mnuchin's insistence on pushing forward with an extra-long bond, (50, and...

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Correction or Trend Change?

The US dollar closed lower against all the major currencies last week but the Japanese yen.  The Swiss franc's 0.25% gain was the smallest of the majors.  The move against the dollar was led by the Swedish krona, whose 2% gain was aided by a less dovish than expected central bank.  Other currencies, like the dollar bloc, which often trades better as risk appetites improve, also did well.  Sterling was lifted by the perceived likelihood that a no-deal Brexit had been averted. The...

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Dollar Party but the Yen wasn’t Invited

The US dollar rose against all the major currencies last week and was bid to new multi-year highs against the euro, Scandis and the New Zealand dollar ahead of the weekend.  The Dollar Index looked above 99.00 for the first time since May 2017. The greenback's gains in August were the most pronounced against the New Zealand dollar and the Norwegian krone, both of which fell by more than 4%.  The Australian dollar and Swedish krona fell about half as much.  On the other hand, the yen...

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Johnson Faces Legal Challenges and Conte may be Given an Extension

Overview:  The capital markets are calm today, though there does seem to be some optimism creeping back into the market.  The Chinese yuan strengthened, snapping a ten-day slide and Italian bank shares index has risen by more than 1% for the fourth consecutive session.  The safe-haven yen and Swiss franc are softer.  In fact, the dollar is rising against the Swiss franc for the fourth straight session, which if sustained, would be the longest streak in several months.  Asia Pacific...

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Prices: A Week in a Day

The pattern has been repeated.  The Federal Reserve, to which he appointed the Chair, and several Governors does not move as quickly as the President wants on monetary policy. He responds by escalating the trade tension, delivering the independent central bank a fait accompli.  Increasing the trade conflict succeeds where the unusual and repeated protestations of the dollar's strength fail, pushing the greenback lower in the foreign exchange market.   Until the end of the last week,...

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Marking Time Ahead of PMI and Powell

Overview:  Global equities and bonds are firmer in quiet turnover, and the dollar is narrowing mixed in narrow ranges.  The big events of the week, the eurozone flash PMI and Powell's speech at Jackson Hole still lie ahead.  The MSCI Asia Pacific Index rose for the third consecutive session, led by Korea and Australia's 1%+ gains.  Europe's Dow Jones Stoxx 600 is firm and testing two-week highs. US equities are also trying to extend yesterday's gain.  The rise in US yields yesterday...

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A Look at the Charts

The White House is unlikely to comment on it, even if it is aware that the Chinese yuan was the third strongest currency in the world last week.  The British pound was the strongest, rising a little less than 1% against the dollar and snapping a 14-week plummet against the euro.  None of the other major currencies appreciated against the dollar last week.  The Chilean peso was the strongest among emerging market currencies, rising about 0.4%.  It is the second consecutive weekly gain...

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Every Currency is a Snowflake

The dollar was mostly weaker against the major currencies last week.  The Swiss franc and Japanese yen were joined by the seemingly unlikely candidate, the Swedish krona, to have gained about 1% against the US dollar last week to the lead the majors.  The yen and franc's gains extended moves already underway and perhaps, accentuated by the sell-off in stocks and the rally in bonds in response to the heightened trade tensions. The krona has the appeal of a high beta euro, and as the...

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PBOC Continues to Check CNY Fall While Euro has Shrugged Off Italy’s Political Turmoil

Overview:  The S&P 500 gapped higher yesterday and posted its largest gain in two months.  Most of Asia Pacific but China and Hong Kong advanced. The three-day recovery in the MSCI Asia Pacific was insufficient to offset the losses at the start of the week, and the benchmark finished lower for the third consecutive week.  Europe's Dow Jones Stoxx 600 is paring yesterday's 1.6% gain, which was the largest in almost two months. US shares are trading with a heavier bias in Europe.   ...

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