Key Points:

US stock markets bounce back led by Nasdaq

BoC leave rates unchanged

EU/UK to have emergency Brexit talks as UK attempts to break deal

Markets went into recovery mode after Tuesdays sell off with US stocks finding their feet and putting in some impressive gains despite a late sell off into the close. Nasdaq made back 2.71% from the more than 4% loss the previous day. WTI regained $38, the commodity bloc currencies were back in vogue once again and Gold closed up $16 on the day. For the DXY we have managed to hold steady above 93.00 and indicates that we could be at a crossroads with regard to strength for the greenback moving forward and how risk assets perform. Was overnight a corrective bounce before a larger down move or was the recent sell off the buy the dip opportunity? For Cable there appears to be nervousness and uncertainty due to the UK government’s stance towards the Brexit agreement with emergency talks due to take place later today between the EU and UK. The pound fell from above 1.30 to hit 1.2885 before managing to retrace and EUR also managed to push back above 1.1800 with EUR/GBP finding offers around 0.9130 a six week high. BoC left things unchanged that saw the CAD strengthen after the announcement with the risk being that they were more dovish however the loonie underperformed vs the other commodity bloc currencies despite the stronger Oil price. No data to excite for the upcoming Asia session with eyes on the ECB and Brexit talks before the weekly US jobless claims number so it’s likely that volatility levels will increase as the days progresses. Markets will be looking to Lagarde for any comments surrounding the exchange rate.

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