Huge day ahead for markets

September 13, 2018

A massive day for markets, with a stack of vital economic data being released from around the world.

The dollar weakened overnight, sending paired currencies higher. The EUR/USD opened the day at $1.16030 and declined during the early part of the session, in what looked like turning into an ugly session for the euro. The pair bottomed out mid-session, hitting $1.15689. It took some time, but the euro bounced off those lows, rallying quite strongly late in the session to peak at $1.16493. It has come off those highs and is currently trading at $1.16285. The GBP/USD opened the day at $1.30287 and slid to lows of $1.29785 mid-session. Like the euro, the pound bounced off those lows, surging over the next few hours to highs of $1.30818. It has come off those highs and is currently trading at $1.30454.

The Dow remained largely flat, save for a four-hour period where both session highs and session lows were achieved. The index opened at 25.993.00 and traded in a tight range for most of the session. The Dow then spiked to a high of 26,150.12 on the back of US-China trade talk news. That high was short-lived however as the Dow fell to lows of 25,926.68 around 2-3 hours later. It is currently trading at almost the identical opening price yesterday, 25,993.60. The Dax was opened and closed near the same level but it did show some swings in between. The German index opened at 11,999.00 and climbed to near-session highs of 12,046.65. It fell away from that point, declining to lows of 11,950.10 late in the session. The Dax then rallied, pulled up by a surging Dow, where it hit high of 12,048.30. It could not maintain those highs, closing at 12,014.80.

The day ahead is a massive one for markets, with vital announcements emanating from the UK, Europe and US. The UK and Europe are both holding their interest rate meetings tonight, while the US is publishing CPI & Core CPI data. As the Brexit deadline approaches, it is important that the UK continues to strong economic data. While the BoE are expected to leave rates on hold, the commentary surrounding the decision could prove to be market-moving. The ECB is also expected to leave rates unchanged, bringing the commentary into focus as well. These decisions have the potential to affect GBP & EUR-paired currencies as well as the FTSE and Dax. The US is publishing crucial CPI data later in the night which could affect the US indexes, the Dow, NASDAQ and S&P 500. Other data set for release today includes:

Japan – PPI, Core Machinery Orders

Canada – NHPI

NZ – Business NZ Manufacturing Index

Australia – Employment Change, Unemployment Rate

Europe – German & French Final CPIs, ECB Press Conference

UK – Asset Purchase Facility, Monetary Policy Summary

US – Unemployment Claims, Natural Gas Storage, Federal Budget Balance, FOMC Members Rand Quarles & Raphael Bostic speak


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