- Equity markets continue to rise in the world, in the context of persistent volatility.
- The dollar with mixed results, the DXY at weekly lows.
- Metals are clinging to significant gains, as is oil.
Wall Street aims to continue with the rises, starting the month and the last quarter firmly. The dollar remains weak and bonds continue to recover ground. Oil rises as expected from OPEC+ and metals validate a significant advance.
follow the rally
Stocks closed higher on Monday, despite, or because of, poor US economic data. The ISM Manufacturing for September came in below expectations, accelerating the dollar’s downward correction and favoring commodities since the bonds.
S&P futures rise 1.61%, while Dow Jones futures climb 1.32% and those of the Nasdaq 2%. In Europe, the main markets register important advances. The FTSE 100 rises 1.90%, the CAC 40 jumps 3.40% and the DAX climbs 2.85%.
The optimism of these hours is being accompanied by a rise in sovereign bonds. This is the characteristic of the “new normal”. In the old world, times of high risk appetite were accompanied by rising yields as investors opted to unload safe positions (bonds) to go into stocks. Now the story is different as central banks are raising the rate and rising bond yields create extra fear. The US 10-year bond is below 3.60% on Tuesday, at its lowest in almost two weeks, when a week ago it had climbed above 4%.
The Reserve Bank of Australia The RBA raised the benchmark interest rate on Tuesday by 25 basis points, less than the 50 expected by most analysts. It is the first of the central banks to reduce the rate of hikes. This initially dropped the Aussie, but at a moderate pace. AUD/USD initially fell to 0.6450 but later regained lost ground.
Wednesday will be the turn of the Reserve Bank of New Zealand (RBNZ). A rise of 50 basis points from 3% to 3.5% is expected. Although now there is speculation that it could also reduce the pace of the rises following in the footsteps of the RBA. NZD/USD slips modestly on Tuesday after failing to hold onto positive ground.
The Dollar Index (DXY) is down 0.41% and is at 111.20, the lowest since September 22nd. The most important fall of the dollar occurs against the European currencies, since against the CAD, AUD and NZD it is rising. Emerging market currencies are shown without significant changes.
The pound continues to recover ground after the collapse of days ago. The announcement to reverse part of the tax cut helped the British currency. EUR/GBP hit weekly lows and GBP/USD is above 1.1300.
The metals They trade unchanged from yesterday’s close, after setting new highs in weeks. Gold and silver both made significant gains on Monday and are holding on to those gains. XAU/USD went from $1,665 to $1,712 (Tuesday’s high) and is around $1,705. XAG/USD went from $19.35 to $21.00 and is around $20.70/75.
The prices of Petroleum They maintain the positive tone in advance of the decision on Wednesday by the Organization of Petroleum Exporting Countries and its allies, which would be a cut in oil production between 500,000 and one million barrels. Also contributing to the rise is the rise in the stock markets and the weakness of the dollar. The barrel of WTI is testing Monday’s highs above $84.00.
The increases in raw materials have a replica in the cryptocurrenciesalbeit at a slower pace. The Bitcoin raises for the second day and tries to recover the $20,000, while ethereum he does it at $1,350.
On Tuesday, data will be published in the US on job announcements, and the factory orders report for August. The ADP for September will arrive on Wednesday and the official employment report on Friday, with non-farm payrolls.
Technical levels
Source: Fx Street
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