ALPHA Market Update 18 October 2018

18.10.2018

Market Update

 

 

United States

  • Initial Jobless Claims and Philadelphia Fed Manufacturing Index data will be announced at 13:30
  • Ignore Trump sniper Fed’s September meeting minutes(FOMC) point to further rate hikes
  • White House economic adviser Kudlow said on Wednesday that Trump is not asking the Fed to change its policy. Yesterday, Trump said that raising interest rates is his biggest threat at present. Kudlow said: “He did not interfere with their (Fed) independence. He will not go there to tell them to change plans or strategies.”
  • After re-signing the North American Trade Agreement (NAFTA), the US Trade Representative Office told Congress that it intends to conduct trade negotiations with the European Union, the United Kingdom and Japan.

Europe

  • THE US has threatened to exclude EU banks from accessing US exchanges if the EU does not agree to water down their plans to oversee financial institutions after Brexit. The head of the US’s Commodity Futures Trading Commission (CFTC), Christopher Giancarlo, said the EU’s plans on oversight clearing houses was “completely irresponsible” and would be met with retaliation. Clearing houses are financial institutions that are meant to ease the exchange of various transactions. He said: “These are blunt and strong tools. “None of these options represent a course of action that I wish to pursue.”

United Kingdom

  • GBP/USD pair is on the defensive in Asia, having established a lower high at 1.3236 on Monday.
  • More importantly, the pullback from the Oct. 12 high of 1.3258 has neutralized the bullish outlook put forward by the bull flag breakout confirmed on Oct. 5.
  • Further, the hawkish Fed minutes and Brexit uncertainty indicate that for the near-term, the path of least resistance is to the downside.
  • Defending that level in Europe could become a tough task if the UK retail sales, due at 08:30 GMT, show a bigger-than-expected drop in consumption in September.
  • The market is expecting September retail sales to print at -0.4 percent month-on-month, following a 0.3 percent rise in August.
  • The pound may pick up a bid if the retail sales beat estimates by a big margin, although, a bullish breakout would be confirmed only above the recent high of 1.3258.

Australia

  • No News

New Zealand

  • No News

Commodities

  • Oil inched up on Thursday amid ongoing tensions over the death of a prominent Saudi journalist, with prices steadying after a big drop overnight due to a jump in U.S. crude stockpiles. U.S. West Texas Intermediate crude for October delivery was up 12 cents, or 0.2 percent, at $69.87 a barrel by 0413 GMT, after falling 3 percent in the previous session to settle below $70 for the first time in a month. Front-month London Brent crude for December delivery was up 13 cents, or 0.2 percent, at $80.18, having ended down 1.7 percent. U.S. crude stocks rose 6.5 million barrels last week, the U.S. Energy Information Administration said on Wednesday, the fourth straight weekly build and almost triple what analysts had forecast.
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