Europe roundup: Sterling hits one month low as Bank of England rate hike expectations pushed back,european shares rise, Gold steadies, Oil prices rise on expected U.S. stocks draw-22nd September, 2021
22. September 2021 13:32:28
•Italian Jul Industrial Sales (YoY) 19.10%, 28.40% previous
•Italian Jul Industrial Sales (MoM) 0.90%,3.10% previous
•US Mortgage Refinance Index 3,391.1, 3,185.6 previous
•US Mortgage Market Index 742.7, 707.9 previous
•US MBA Purchase Index 283.9, 277.9 previous
Looking Ahead Economic Data (GMT)
•14:00 EU Sep Consumer Confidence -5.8 forecast, -5.3 previous
•14:00 US Aug Existing Home Sales (MoM) 2.0% previous
•`14:00 US Aug Existing Home Sales 5.89M forecast, 5.99M previous
•`14:30 US Cushing Crude Oil Inventories -1.103M previous
•`14:30 US Crude Oil Inventories -2.440M, -6.422M previous
•`18:00 US Fed Interest Rate Decision 0.25% previous
Looking Ahead – Events, Other Releases (GMT)
•`16:00 BoE Deputy Governor Woods Speaks
•`18:00 US FOMC Statement
EUR/USD: The euro strengthened against dollar on Wednesday as risk appetite improved after China Evergrande Group pledged it would make an upcoming bond coupon, offering relief to jittery markets that were on the edge on concerns of a potential debt crisis. Evergrande said on Wednesday it would make a coupon payment on its domestic bonds on Sept. 23, allaying fears that a default of China’s No. 2 developer could ripple through the global financial system. The euro changed hands at $1.1725 , having stabilised at a one-month low of $1.1700 on Monday. Immediate resistance can be seen at 1.1742 (50%fib), an upside break can trigger rise towards 1.1776(61.8%fib).On the downside, immediate support is seen at 1.1703(38.2%fib), a break below could take the pair towards 1.1660 (23.6%fib).
GBP/USD: Sterling fell to a one-month low on Wednesday as investors pushed back expectations of a rate hike by the Bank of England after a flurry of weak data.In early London trade, the British currency eased 0.1% to $1.3636, with more losses expected after it dropped below a low of $1.364 hit on Monday.Even a subdued greenback and improving risk sentiment after debt-laden China Evergrande calmed nerves by saying it would repay a yuan-denominated bond on Thursday failed to lift the pound . Immediate resistance can be seen at 1.3676 (38.2%fib), an upside break can trigger rise towards 1.3698 (5DMA).On the downside, immediate support is seen at 1.3629 (38.2%fib), a break below could take the pair towards 1.3585 (50%fib).
USD/CHF: The dollar declined against the Swiss franc on Wednesday as investors assessed the level of contagion stemming from distress at developer China Evergrande and awaited central bank meetings. Swiss franc drew bids as investors became risk averse.Investors were focused on the situation at Evergrande, where persistent default fears eclipsed efforts by the debt-laden group’s chairman to lift confidence as Beijing showed no sign it would intervene to stem any domino effects across the global economy .Immediate resistance can be seen at 0.947 (50%fib), an upside break can trigger rise towards 0.9278 (61.8%fib).On the downside, immediate support is seen at 0.9215(38.2%fib), a break below could take the pair towards 0.9176(61.8%fib).
USD/JPY: The dollar strengthened against yen on Wednesday as investors focused on two key risks a default by Chinese property developer Evergrande and the expected pace of U.S. monetary policy tightening. Evergrande, once China’s top-selling property developer, is inching closer to a key deadline on Thursday when the firm is due to pay $83.5 million in interest relating to its March 2022 bond . Another major focus for the day is the U.S. Federal Reserve, which is expected to drop more hints on its future policy path .The dollar was trading 0.12% higher versus the dollar at 109.51. Strong resistance can be seen at 109.51(5DMA), an upside break can trigger rise towards 109.86(23.6%fib).On the downside, immediate support is seen at 109.14(50%fib), a break below could take the pair towards 108.86(61.8%fib).
European stocks rose on Wednesday, recovering from its early-week losses after debt-laden China Evergrande said it would make some interest payments, while travel and leisure stocks jumped to a 14-week high.
At (GMT 11:20),UK’s benchmark FTSE 100 was last trading up at 1.20% percent, Germany’s Dax was up by 0.52%percent, France’s CAC finished was up by 1.09% percent.
Gold prices were steady on Wednesday as investors braced for the outcome of a U.S. Federal Reserve meeting and chief Jerome Powell’s remarks on reducing its massive support for the pandemic-hit economy.
Spot gold rose 0.1% to $1,775.36 per ounce by 0840 GMT, while U.S. gold futures fell 0.2% to $1,775.00.
Oil prices climbed more than $1 on Wednesday, extending overnight gains after industry data showed U.S. crude stocks fell more than expected last week in the wake of two hurricanes, highlighting tight supply as demand improves.
U.S. West Texas Intermediate (WTI) crude futures rose $1.16, or 1.6%, to $71.65 a barrel by 1055 GMT, adding to a 35- cent gain from Tuesday.
Brent crude futures climbed $1.08, or 1.4%, to $75.44 a barrel, after gaining 44 cents on Tuesday.