The Day So Far
Geopolitics to the fore this morning as markets were rattled early doors by news that Turkey had shot down a Russian fighter jet around the Syrian border. This came on the back of a mixed Asia session and a weak finish yet again to the US session, where equities failed to hold on to their earlier gains despite some encouraging M&A activity in the pharmaceutical space, where it was announced that Pfizer and Allergan are set to combine in a deal potentially worth $160bn. This takes global M&A activity for 2015 to $4.2 trillion, above the pre-crisis high in 2007. This could be interpreted in several ways; either corporate CEOs are feeling increasingly bullish about the prospects for global growth; or more likely, the lack of organic growth sales prevalent in corporate earnings statements the past couple of years, coupled with high cash levels and low borrowing costs, is leading a mad dash to consolidate before the Fed begins a fresh hiking cycle and higher borrowing costs kick in.
Not even some solid German IFO survey results for November could quite lift sentiment, although the euro continued to grind higher throughout the session, trading up towards the 1.0670-80 levels where there has been considerable resistance. T notes have enjoyed a positive session in classic ‘risk-off’ trading, trading above the 127 handle before retracing a touch as markets stabilised. In the equity space, the S&P sold off some 20 points pre-cash open and the Dax broke below 11,000 for the first time in a week.
The Afternoon View
Looking ahead to this afternoon, we get a second look at US Q3 GDP, as well as the S&P/Case Shiller House Price Index, followed by the Consumer Confidence Index at 15:00 BST. Look for risk-off to continue this afternoon, equities should remain under pressure and we maintain our short bias in the euro and crude, although as noted yesterday the downside momentum is slowing and settling into more range bound markets before the crucial ECB and OPEC meetings next week.
Amplify Trading is a Limited company registered in England and Wales. Registered number 6798566. Registered address: 50 Bank Street, 3rd Floor, Canary Wharf, London, E24 5NS. Information or opinions provided by us should not be used for investment advice and do not constitute an offer to sell or solicitation of an offer to buy any securities or financial instruments or any advice or recommendation with respect to such securities or other financial instruments. When making a decision about your investments, you should seek the advice of a professional financial adviser.
Recommended Content
Editors’ Picks
USD/JPY pops and drops on BoJ's expected hold
USD/JPY reverses a knee-jerk spike to 142.80 and returns to the red below 142.50 after the Bank of Japan announced on Friday that it maintained the short-term rate target in the range of 0.15%-0.25%, as widely expected. Governor Ueda's press conference is next in focus.
AUD/USD bears attack 0.6800 amid PBOC's status-quo, cautious mood
AUD/USD attacks 0.6800 in Friday's Asian trading, extending its gradual retreat after the PBOC unexpectedly left mortgage lending rates unchanged in September. A cautious market mood also adds to the weight on the Aussie. Fedspeak eyed.
Gold consolidates near record high, bullish potential seems intact
Gold price regained positive traction on Thursday and rallied back closer to the all-time peak touched the previous day in reaction to the Federal Reserve's decision to start the policy easing cycle with an oversized rate cut.
Ethereum rallies over 6% following decision to split Pectra upgrade into two phases
In its Consensus Layer Call on Thursday, Ethereum developers decided to split the upcoming Pectra upgrade into two batches. The decision follows concerns about potential risks in shipping the previously approved series of Ethereum improvement proposals.
Bank of Japan set to keep rates on hold after July’s hike shocked markets
The Bank of Japan is expected to keep its short-term interest rate target between 0.15% and 0.25% on Friday, following the conclusion of its two-day monetary policy review. The decision is set to be announced during the early Asian session.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.