Market Brief
The last few day have seen some big move in the risk assets on no particular news or events. Just the general impression that the global recovery will take a bit longer to fully entrench itself. The lack of hard driver supports a short term correction of risky assets, which began to take shape in yesterday's US equity trading and gained some traction in the Asian session. Currently, European equities are trading higher. Commodities were able to halt their rapid slide, with crude steadying around the $61.00bll level. With the JPY continuing to gain unwanted strength in the eyes of the BoJ, we need to start considering the BoJ's tolerance zones. We would expect to hear some level of verbal intervention by Japanese officials around 93.00 / 50. In Australia, unemployment rate continued to creep higher to 5.8%, although lower than the market's expectation of 5.9%. The AUD has recently come under pressure from weaker commodity prices and as investors risk appetite as declined. Today's major event will the BoE rate decision. While the markets universally expect the central bank to hold at 0.50% there is plenty of speculation regarding the possibility that the MPC will announce an expansion of its asset purchase program. Whatever the exact number of the increase, it will be seen as an acknowledgement that QE has not worked as efficiently as earlier believed. Historically, QE has been negative for the underlying currency, in this case the Sterling, and we don’t expect anything different today.
| Global Indexes | Current Level | % Change |
| Nikkei 225 Index | 9,291.06 | -1.37 |
| Hang Seng Index | 17,751.97 | 0.17 |
| Shanghai Index | 3,123.04 | 1.37 |
| FTSE 100 Index | 4,160.21 | 0.48 |
| DAX Index | 4,614.80 | 0.92 |
| SMI Index | 5,307.41 | 0.34 |
| DJIA futures | 8,161.00 | 0.55 |
| World Markets | Current Level | % Change |
| Gold | 913.5 | 0.44 |
| Silver | 12.89 | 0.29 |
| VIX | 31.3 | 1.45 |
| Crude wti | 61.07 | 1.54 |
| USD Index | 80.45 | -0.39 |
| Todays Calender | Estimates | Previous | Country / GMT |
| Global: G8 meeting to be held in Italy (to 10/7) | -- | -- | -- |
| BoE MPC Bank Rate decision, % Jul | 0.5 | 0.5 | GBP / 12.00 |
| Manuf. Production, % y/y (nsa) May | -16.8 | -21.6 | ZAR / 12.00 |
| Initial jobless claims, thous (4wk mvg avg) 04-Jul | -- | 614 (615) | USD / 12.30 |
| Wholesale inventories, % m/m (y/y) May | -1.0,-7.4 | -1.4, -6.2 | USD / 14.00 |
| CPI, % m/m Jun | 0.2 | -0.29 | MXN / 14.00 |
| Corporate goods price index, % y/y Jun | -- | -5.4 | JPY / 23.00 |
Currency Tech
AUDUSD
R 3: 0.8155
R 2: 0.8038
R 1: 0.7970
CURRENT: 0.7835
S 1: 0.7750
S 2: 0.7630
S 3: 0.7451
EURJPY
R 3: 134.80
R 2: 132.82
R 1: 131.20
CURRENT: 130.20
S 1: 128.10
S 2: 126.98
S 3: 124.39
USDSGD
R 3: 1.4803
R 2: 1.4748
R 1: 1.4660
CURRENT: 1.4582
S 1: 1.4533
S 2: 1.4420
S 3: 1.4400
- S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot
