Weak data and diminished investor sentiment lead the markets
Laurence Hayward " | October 2, 2019
The September ADP employment change fell to 135k from a revised 157k in August. The impeachment inquiry in the US continues with Kurt Volker set to testify tomorrow. Weak manufacturing data out of the US hit investor sentiment. Boris Johnson addressed the EU providing vague details on a revised Brexit plan.
October 2, 2019
EUR/USD 1.0943 GBP/USD 1.2293 USD/CAD 1.3280 AUD/USD 0.6698 USD/JPY 107.46 USD/CNH 7.1486 USD/ILS 3.4924 USD/MXN 19.8020 USD/CHF 1.0002 USD/INR 71.0837
The dollar index fell slightly today. The impeachment inquiry of President Trump is still a key point of focus with former US representative to the Ukraine Kurt Volker set to testify in private tomorrow. Trump tweeted that the inquiry is tantamount to a “COUP”. Stocks fell yesterday as manufacturing data slid to a 10-year low for September hitting investor sentiment in the US.GBP
The pound is hovering around 2-year lows after Boris Johnson delivered vague details on his Brexit proposals and reiterated the threat that he could opt for a hard exit if no deal is reached. The suggested solution to the Irish backstop is to have two borders for four years and Northern Ireland would have a special relationship with the EU until 2025. Ireland's Simon Coveney said a time limited backstop would most likely be rejected.
Yesterday’s manufacturing data came in higher than forecast but remain in the longest slump since 2009.EUR
The euro strengthened as the European Central Bank changed its economic benchmark today. ECB head Mario Draghi hinted that complementary fiscal policies to the ECB’s stimulus plan could end ultra-low interest rates. The US published a list of potential tariff targets worth roughly $25B today. The impression is that the US could introduce fresh tariffs as soon as this month.CAD
The Canadian dollar weakened as oil and gas output in July showed the largest fall since 2016. This in turn dragged down the July GDP.ASIA/PACIFIC
China is still closed for a holiday today. Equities in the region declined due to geopolitical tensions and weak US economic data. North Korea fired ballistic missiles into the sea - Japan said two missiles landed in the Sea of Japan.