Markets are Down on Higher Volatility

Highlights

• Markets are Down on Higher Volatility

• Commodity Currencies Gaining

• Confidence & Fischer

Please note: All data, figures & graphs below are valid as of September 27th. All trading carries risk. Only risk capital you're prepared to lose.

 

Markets are Moving

European and US markets took a very singular direction in yesterday's sessions, and that direction was down. Leading the losses is the Ger30 with minus 2.19% and Fra40 with 1.8%. The US losses were a bit more tame, just under 1% for the DJ30 and SPX500.

Meanwhile, volatility is up again, with the VIX reading 14.5.

So far today, Asian stocks are more or less flat but the currency markets are on the move. Here we can see moves of about 0.5% on the AUD, NZD, and JPY, which is quite impressive for FX.

Also, these moves point to a risk-on sentiment in the markets as the risky currencies are gaining against the safety currencies.

It's also interesting to note that the 3 biggest gainers are the commodity currencies, and they are gaining despite losses in Gold and Silver, while we wait for any word from the unofficial OPEC meeting in Algeria.

The gains in the Loony could be trumped up to Trump, but the Aussie and Kiwi are probably not responding to the debate.

 

Looking Forward

Today we have a few interesting announcements on the calendar including European M3 Money Supply and Private Loans in just a few moments.

Later on, early in the US session we'll get the consumer confidence figures from American households, followed by a speech from vice-chair of the Federal Reserve Stanley Fisher.

Tomorrow is a big day as well as we have speeches from both Mario Draghi and Janet Yellen as well as other central bankers who would like their voices heard.

 

Central Bank Love

In the meantime, let's take a quick look at the Fed's current relationship with the markets.

Disclaimer: I don't think this was actually taken from BofA Merrill Lynch.

Just as a quick final note, I'd like to show the Bloomberg implied probability of a rate hike in December (blue line) which is now back to a coin-flip...