Analysts at TD Securities explained that the North American markets started the week on a quiet note despite ongoing uncertainty around trade policy following President Trump's threat of expanded import tariffs on Chinese goods.
"Equities were mixed (SPX: +0.2%, TSX: -0.1%) while rates were little changed on either side of the border, with Canada outperforming by ~1 bp in 2s. GBP (+0.8%) was the top performing G10 currency against the USD after the EU's Barnier announced that a Brexit deal within eight weeks was "realistic" and lawmakers were working towards a summit in mid-October. Positive sentiment spilled over into EUR (+0.4%) while NOK (+0.7%) rallied on CPI data. Australian business confidence and conditions are the main data for today ahead of a busy European session.
What We're Watching in Markets
"Market sentiment has shrugged off Trump's recent escalation of global trade wars and higher-than-expected wage growth in the US. For the USD, global equity divergence has been a key driver the past few months, which argues that any convergence with US share prices could help to cement a floor in the likes of EUR and JPY. Treasuries will remain focused on trade news, Fed speak, and Thursday's CPI report in the near-term. We look for 5s30 curve flattening to persist."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.