Market Insights & Analysis

Read our analysts' daily briefings, together with our Market Snapshot reports.

18 Dec 2015 08:25
Mexico’s central bank followed the Fed yesterday and increased a key rate for the first time since 2008 as officials expressed their desire to keep in step with the US central bank in order to prevent and limit any currency distortions between the US dollar and Mexican peso. The Japanese yen strengthened substantially overnight after briefly trading above 123.50 against the dollar as the Bank of Japan offered additional support to the economy. Spot gold prices managed to find some stability around $1,050/oz during overnight trading as immediate support around this level managed to hold firm at the close yesterday.
09 Dec 2015 08:48
Some slightly better data coming out of China overnight as we start to see the emerging impact of stimulus measures. The yuan failed to halt its recent bearish run against the USD as investors focused on weaker factory gate prices and continued to digest yesterday’s weaker than expected trade data. Both front month Brent and WTI futures seem to have stemmed the recent outflows as they find support around yesterday’s opening levels.
01 Dec 2015 08:02
Chinese equity markets pushed tentatively higher overnight as encouraging economic news and data supported risk appetite across the region. The inclusion indicates just how extensive the reforms have been in China with offshore spot yuan trading 0.3% weaker against the USD as market participants anticipated that the PBOC would hold off from further stimulus, allowing a freer movement of the currency. After finally managing to close above 100.00 on Friday, the dollar index held firmly onto recent gains on Monday, trading tentatively higher towards 100.310 as investors geared up for this week’s economic data releases ahead of the FOMC meeting later this month.
30 Nov 2015 08:32
Iron ore prices slipped below $40/tonne on Monday after facing considerable headwinds last week. Three month LME copper prices look to be heading lower today as the red metal trades under pressure early on, failing to capitalise on last week’s late gains. The euro is set for its worst monthly performance since March as a growing number of economists expect the ECB to announce additional stimulus efforts at this week’s meeting.
27 Nov 2015 08:39
Gold prices are on track to close lower for the sixth straight week as an increasing number of investors expects the Fed to increase interest rates at next month’s FOMC meeting. Japanese economic data released late last night was less than impressive to say the least, prompting some modest weakness across Asian equity indices as the quiet optimism seen in Europe failed to spill over to the overnight session. Three month copper prices are finding it tough to hold onto yesterday’s gains early on this morning, with prices traded on the LME hovering around yesterday’s close, towards $4,620/tonne.
25 Nov 2015 08:40
George Osborne is set to deliver his Autumn Statement today and is largely expected to present fresh plans on how public sector debt will be curtailed, with an aim to balance the books by 2020. Front month Brent futures managed to gain for a third straight session, a feat last achieved in early October, as mounting geopolitical tensions in the Middle East prompted some buying. The fresh bout of risk aversion has also offered some support to gold prices which look set to rally for a second day after gaining 0.6% yesterday.
20 Nov 2015 08:58
Crude oil prices remain under pressure as ongoing concerns regarding global supply glut dominate the market and weigh heavily on market sentiment. This morning, WTI futures came under renewed pressure in early trade and extended declines towards $40 per barrel while the strong USD adds additional pressure to the market. Please note that both WTI and Brent front month futures have declined over $8/barrel within 3 weeks in November.
19 Nov 2015 08:58
Following a statement after October’s Fed meeting, Fed members made it clear that an interest rate increase would be considered at their “next meeting”, which is scheduled for 15-16th December 2015. The clear message spread optimistic signs across most global markets and increased risk appetite. Most Fed members agreed that US economic conditions are improving, while others agreed that conditions had already been met, in order to trigger a rate increase.
18 Nov 2015 09:00
The US Federal Reserve publishes minutes from its latest FOMC meeting this evening. At the last meeting, the US Fed reported that the current 0% to 0.25% interest rate target “remains appropriate”. The US dollar index hit a high yesterday at 99.745 despite the recent disappointing US economic data. However, this morning the USD index slid slightly lower in early trade and hovered around 99.50 against a basket of currencies.
17 Nov 2015 09:01
The strong USD rally continues to dominate the global equity and commodity markets, as the USD index rallied for third consecutive session and extended gains above 99.50 against a basket of currencies. Gold has been hovering around $1,080/ounce. Copper extended declines towards $4,600 this morning, as the strong USD and bearish copper fundamentals weigh on market sentiment.
13 Nov 2015 08:57
European equities continue to remain under pressure extending losses in early trade on Friday, following the tepid GDP data. The German economy grew by 0.3% in Q3 2015, in line with expectations, while its y/y figure was reported at 1.7%, missing estimates of 1.8%. The French economy grew by 0.3% in Q3 2015, in line with estimates. The EUR continues to remain in choppy consolidation mode after hovering around 1.0750 against the USD. Today’s release of European GDP data has failed so far to provide any direction to the currency.
12 Nov 2015 08:57
Today, the main focus will switch to the release of the weekly jobless claims as well as the monthly Fed Budget Statement, which will set the tone for the trading session. Fed Chair Janet Yellen will deliver a speech at a Fed conference at 14:30 GMT, providing an insight regarding the current US economic conditions and prospects. The USD index extended gains this morning, breaking above the 99.0 area against a basket of currencies.
10 Nov 2015 08:46
Further signs of weakness in China prompted investors to selloff. The Hang Seng index plunged over 300 points (-1.43%) towards 22,400 while the Shanghai Composite Index slid lower by 0.20% towards 3,640. China’s CPI rose 1.3% y/y in October compared to 1.6% in September, missing analysts’ expectations of a 1.5% rise, showing the lowest level since May 2015.
09 Nov 2015 08:42
Chinese exports declined by 6.9% y/y in October, versus analysts’ expectations of a 3.2% drop. Imports dropped sharply by 18.8% y/y in October (vs exp. of -15.2%) compared to a 20.4% strong decline in September. The fairly disappointing Chinese economic data weighed to some extent on market sentiment, while Asian equity markets were mixed overnight. The Hang Seng index retreated by 0.6% towards 22,700.
22 Oct 2015 09:15
The main focus will turn to the ECB meeting as investors remain cautious awaiting the speech of ECB’s President Mario Draghi regarding market expectations. We do not expect any big surprises coming out of the meeting as it seems unlikely the ECB to introduce further QE into the European economies, partially due to inflation concerns and increasing worries regarding the Eurozone’s economic growth.
15 Oct 2015 08:19
After UK inflation data released earlier this week posted a surprise decline into negative territory, investors were bracing themselves for a similar negative outlook for the UK labour market with stocks trading sideways throughout much of the session. The pound sterling recovered all of the previous sessions losses on yesterday’s encouraging employment data, posting its biggest one day rally against the dollar since May as it targeted the 100 day moving average towards 1.5500.
08 Oct 2015 09:05
Market participants will be keeping an eye on the release of the US Fed minutes this evening, looking for clarification of the current US economic conditions and prospects. Furthermore, investors’ attention will also turn to the IMF and World Bank Annual Meeting which will take place this weekend. The USD index currently remains under pressure, hovering around 95.0 against a basket of currencies.
07 Oct 2015 08:57
WTI front month futures extended gains for a fourth consecutive session, eyeing the key $50 per barrel level. The Energy Information Administration (EIA) said in its monthly outlook that US crude oil production fell 120,000 barrels per day in September compared to a month earlier. The API weekly oil inventories report showed yesterday that US crude oil inventories have shrunk by 1.2 million barrels for the week ending 2nd October.
06 Oct 2015 11:10
Crude oil prices hovered within the recent range in early trade this morning as investors await renewed talks that Russia is ready to meet OPEC and non-OPEC crude oil producers in order to discuss the market. The news provided strong upside momentum in the oil market, as Russia has been thus far unwilling to cut oil production and cooperate with the OPEC members in order to support the current low crude oil prices.
06 Oct 2015 09:08
German factory orders dropped significantly by 1.8% m/m in August, versus expectations of a 0.5% rise. European equity markets reversed yesterday’s solid gains and retreated this morning as the DAX, CAC and IBEX fell slightly between 0.50% and 0.80%. The euro continues its consolidation mode, hovering around 1.12 against the USD.
05 Oct 2015 09:12
Asian equity markets rallied overnight with the Nikkei index gaining over 1.5% and adding over 280 points to breach above the 18,000 area. The Hang Seng index climbed 1.4% (300 points) towards 21,800, supported by strong gains in information technology and consumer discretionary sectors. Glencore rallied in Hong Kong and hit a high at 18.36 but gave back earlier gains to finish the session at 12.40.
28 Sep 2015 08:38
After a somewhat disappointing September FOMC meeting as policymakers in the US opted to keep interest rates unchanged despite the hype surrounding the decision among market participants around the world Fed chair Janet Yellen offered additional clarity late last week. The yen continues to find firm support around 120.00 against the dollar as Chinese growth concerns continued to weigh heavily on investor sentiment. The pound sterling faced another under pressure week last week as selling dominated trading activity and dollar strength saw the pound lose over 2.6% throughout the week.
25 Sep 2015 08:18
Platinum prices snapped a four day bear run yesterday as prices seemed to find some near term support just above $931/oz after losing over 5% since the start of the week. Conversely, palladium prices extended gains back towards the 100 day moving average yesterday as investors increased exposure to the metal most commonly used in petrol catalytic convertors. Gold experienced a strong rally yesterday as emerging market fears prompted investors to take shelter in the safe haven.
22 Sep 2015 09:00
The euro declined sharply for a third consecutive session today and dropped below 1.1200 against the USD, hovering around 1.1180. There was some relief in the markets regarding the Greek elections. However, market participants remain cautious ahead of this weekend’s elections in Catalonia, Spain, as the local government is looking to make this a separatism ballot with a possible clash with the Spanish national administration.
18 Sep 2015 08:54
The Federal Reserve held interest rates unchanged at the latest FOMC meeting, with Fed Chair Janet Yellen delivering a “dovish” message. The statement identified that the recent global economic and financial conditions may restrain economic growth and added further downside pressure on US inflation in the short-term. The USD index retreated towards 94.0 against a basket of currencies, remaining under heavy pressure.
17 Sep 2015 09:09
It is decision time for the US Federal Reserve. It seems that global markets are going into today’s FOMC’s meeting with a “dovish” mentality. We may be surprised with an interest rate hike despite the recent tepid US economic data. The USD index has been under some pressure ahead of the announcement, retreating towards 95.0 against a basket of currencies in early trade.
16 Sep 2015 08:52
Asian equity markets rebounded strongly overnight. The Hang Seng index rallied by 2.50% towards 22,100, while the Shanghai Composite index climbed higher by 4.9% to retest 3,150. There is increasing volatility and nervous trading conditions as investors await key decisions from the FOMC meeting tomorrow. The USD index remains strong after hovering around 95.60 against a basket of currencies.
15 Sep 2015 09:15
Asian equity markets remained under pressure overnight. 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.
14 Sep 2015 09:02
This week, the main focus will turn to the FOMC meeting on Thursday. The USD index has lost its upside momentum against the G10 currencies, retreating towards 95.0, as investors remain cautious about the timing of a US interest rate rise this year. We do not expect any big surprises from the Fed this week, as it is likely that the US Federal Reserve Bank will leave interest rates unchanged this time, possibly signalling that the beginning of a tightening policy is approaching.
08 Sep 2015 09:12
The USD index initially slid lower towards 95.50 this morning but recovered part of earlier losses and hovered around 96.0 against a basket of currencies. The softer USD provided strong support to most commodity prices. Germany’s exports remain solid following an increase of 2.4% m/m in July, beating expectations of a 1.0% rise. However, Chinese data remained fairly disappointing as exports declined 5.5% y/y in August.