The FTSE started the week in a more downbeat mode as Brexit negotiations failed to make any progress over the weekend and Chinese data starkly showed how much damage the Sino-US tariff war is doing to the country's trade. Chinese imports have now been shrinking for five months and the September data showed a deeper contraction than in previous months. Similarly, exports have also been affected with data indicating that the effect of the tariffs is beginning to accumulate.

Although the US and China made some progress late last week and President Trump suspended tariffs due to come in in mid-October, the damage from the existing trade restrictions is being felt. US stock markets are also bracing themselves for the latest US reporting season due to start this week which will also show how much the trade conflict bruised and battered US companies, particularly technology firms with strong Asian exposure.

 

Sterling drops as talks reach deadlock

The pound has dropped like a stone overnight after Brexit negotiations didn't lead to any significant progress over the weekend. Sterling had bounced to levels not seen since the beginning of the year after Boris Johnson and his Irish counterpart indicated that they might have a solution to the Brexit deadlock. However, hopes of a resolution were dashed after EU negotiators commented that they are not getting even into the ballpark area of where they would like to be with negotiations. This gives Boris Johnson only one more week to pull the rabbit out of the hat. By October 19 MPs will have to vote on whether to delay Brexit or not and at this stage there seems to be no prospect of a peaceful resolution. The pound has in the meantime slipped back to 1.2565.

 

Oil slides on weak Chinese data

With the situation in the Gulf seemingly quiet for the moment the oil market's focus has turned back to the slowing global demand, and Chinese data early this morning provided no encouragement in that respect. Prices are coasting along the $60 level but activity is fairly unconvincing.

CFD and forex trading are leveraged products and can result in losses that exceed your deposits. They may not be suitable for everyone. Ensure you fully understand the risks. From time to time, City Index Limited’s (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material. As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed

Analysis feed

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Analysis


Latest Forex Analysis

Editors’ Picks

EUR/USD defends gains above 1.1300 amid broad dollar recovery

EUR/USD defends gains above 1.1300 amid a broad-based US dollar recovery. The shared currency remains at the mercy of the broader market sentiment as the data docket is light on Monday. COVID-19 stats in focus. 

EUR/USD News

GBP/USD batting to extend gains beyond 1.2600

Risk-on mood limits the dollar’s bullish potential. GBP/USD bounces from daily lows, but Brexit concerns weigh on Sterling. BOE Governor Bailey's speech awaited.

GBP/USD News

XAU/USD inches closer to multi-year highs, trades around $1,810

The XAU/USD pair registered its highest weekly close since September of 2011 at $1,799 on Friday and continued to push higher on Monday.

Gold News

Dominance war to push Ethereum to $270

The Altcoin segment is still in full swing while the crypto board leaders, Bitcoin and Ethereum, remain stuck at the same levels as in recent weeks. The dispute for market share, or dominance in technical terms, remains at a point of maximum tension. 

Read more

WTI breaches $40 mark as talks of OPEC+ output cuts easing weigh

WTI (August futures on Nymex) extends Friday’s sell-off into the European trading this Monday, following a brief consolidation seen above $40 mark earlier in the Asian session.

Oil News

Forex Majors

Cryptocurrencies

Signatures