News / Analysis
Finance Update – Shifting focus to BrexitSeptember 15, 2020
Chinese indices are up this morning on mainly positive data, led by the Shenzhen at 0.73% and including the Hang Seng (0.29%), as the Chinese Yuan continues north against the USD despite yesterday’s central bank fix. Retail sales in China in August expanded by 0.5% YoY while industrial production soared by 5.6%.
Meanwhile, the Nikkei leads regional losers with a 0.57% decline followed by New Zealand’s DJ (-0.24%) and Australia’s ASX (-0.15%), as house prices in Q2 added 6.2% YoY, compared to 7.4% in Q1.
The Australian Dollar received an 0.48% boost overnight after RBA minutes expressed cautious optimism an a less-worse-than-expected economic downturn, highlighting an uneven economic recovery from the COVID pandemic and maintaining the 3-year bond yield target.
European indices were mixed yesterday, the CAC adding 0.35% but the DAX and FTSE down 0.07% & 0.1% respectively.
The pound received a cautious 120-pip boost yesterday after Parliament signed on to PM Johnson’s proposed breach of previous Brexit agreements. Following the 340/263 win, Johnson blamed the EU for seeking to “Break up” the nation by demanding a trade barrier between England and Northern Ireland.
Meanwhile, UK Unemployment in July grew to 4.1% as expected – its first rate rise since lockdown was launched in March – but earnings contracted by 1% – better than the expected 1.3%. The independent Institute for Employment Studies research organsation predicts that about 650K more Brits will lose their jobs in the 2nd half of the year.
Industrial production throughout the Eurozone expanded by 4.1% MoM in July – a tick better than expected, and consumer inflation in France for August remained steady at -0.5% YoY.
US Indices all closed up yesterday led by the Russel2000’s 2.71% increase.
The dollar continues its 4-day decline, as risk appetites grow on hopes of a November vaccination. Yields last night on the 3- & 6-month treasury bills contracting by 0.005%, respectively.
Yesterday, the US government put aside plans for an import ban on cotton and tomato products from China, this as China for its part extended tariff exemptions on 16 US products for another year. Other textiles, hair products and computer products were added to the US ban list due to forced labour issues.
Gold yesterday registered a $14 jump per ounce before continuing upward to attack the 1975 resistance zone.
Oil lost 0.13% overnight after OPEC warned of a 9.5 MBpD cut in demand expectations based on a global 4% cut to the world’s economy in 2020.
FedEx today reports earnings as McDonald’s, Dover, Perrigo, International Paper & Whirlpool pay dividends.
|08:00 AM GMT||Italy||CPIs|
|09:00 AM GMT||EU & Germany||Economic sentiment|
|12:30 PM GMT||US||NY Manufacturing Index & import/export prices. Redbook at 12:55. Industrial Production at 1:15.|
|08:30 PM GMT||OIL||API Crude Oil Inventories|
|09:00 PM GMT||NZ||House Price Index|
|11:50 PM GMT||Japan||Trade Balance|
|00:30 AM GMT (+1)||Australia||Westpac Leading Index. Home sales at 1 AM|