Markets await key economic data

Tuesday, September 15, 2015

Asian equity markets remained under pressure overnight. The Shanghai Composite index extended declined over 100 points (-3.5%) to retest 3,000. The Hang Seng index followed the downtrend and slid lower by 0.30% towards 21,500. However, the Nikkei index bucked the trend and rebounded above 18,000, adding nearly 0.35%.

Eurozone’s new car registrations increased by 11.2% m/m in August compared to a 9.5% rise in July. Market participants will be keeping an eye on today’s release of the ZEW economic survey expectations in Germany and the Eurozone, as well as the Eurozone’s trade balance in July and unemployment data for Q2 2015. In the UK, this morning’s key inflation data will draw investors’ attention. European equity markets opened higher today and extended gains with the DAX, CAC, IBEX and London equity benchmark indices adding between 0.20% and 0.45%. The euro came under renewed pressure this morning, retreating below 1.13 against the USD, as investors remain cautious ahead of FOMC meeting on Thursday.

EURUSD

EURUSD Curncy (EUR-USD X-RATE)   2015-09-15 09-18-06

Greece’s general election will also be watched closely over the weekend. Opinion polls suggest a very close outcome, as Syriza leader Alexis Tsipras and his New Democracy opponent Evangelos Meimarakis are running neck-and-neck. Support for Syriza has dropped significantly since ex-Prime Minister Alexis Tsipras signed a third bailout for Greece. However, there should be no immediate risk of a bailout rejection.   

Precious metal prices continue their strong downside momentum. Gold has been hovering around $1100/ounce while silver has retreated over 0.65% in early trade this morning. Platinum and palladium also remained in negative territory. The recent disappointing Chinese economic data and the strong US dollar hurt market sentiment in base metals market. Copper declined over 0.7% towards $5250 this morning, while aluminium dropped below $1,600. Lead, nickel and zinc declined between 1.3% and 2.0% in early trade.

Today, investors will be keeping an eye on the release of the US retail sales and industrial production data in August as well as September’s NY Empire State Manufacturing Survey for signs of direction ahead of the crucial FOMC decision later this week. The USD index holds strongly above 95.0 against a basket of currencies, weighing on most commodity prices.

USD index

DXY Curncy (DOLLAR INDEX SPOT)   2015-09-15 09-17-04

 

Events for today:

0930

UK

Aug

CPI & RPI

1000

EZ

Jul

Trade Balance

1000

DE

Sep

ZEW Survey

1000

EZ

Sep

ZEW Survey

1330

US

Sep

NY Fed Manufacturing

1330

US

Aug

Retail Sales

1415

US

Aug

Industrial Production

1500

US

Jul

Business Inventories

 

All times UK Local Time

 

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