Market News & Analysis


Market Brief: Markets Take Trump’s Impeachment Inquiry Within Stride



FX Brief:        

  • RBNZ held rates as expected, although scope for further fiscal and monetary stimulus remains “if needed”. Data since their August MPS (Monetary Policy Statement) didn’t warrant a significant change to their outlook and RBNZ are “pleased” with their lower currency – points we both outlined in yesterday’s RBNZ preview.
    NZD and USD are the strongest majors, JPY and AUD are the weakest, although ranges remain narrow outside of NZD pairs.
  • NZD/USD hit a 5-day post meeting, AUD/NZD broken beneath key support to confirm a double top and the biggest gainer is NZD/JPY, currently the only pair to exceed its typical daily range.
  • As for the dollar, it’s retraced from yesterday’s lows across the board yet several pairs warrant a closer look; USD/CHS is trying to break its bullish trendline form August, USD/CAD is trying to carve out a top, USD?JPY is back above 107 and EUR/USD is considering another break of 1.10.  
  • Cryptocurrencies have made a minor effort to pare losses endured during yesterday’s crypto rout. Yet given the double-digit losses sustained across the board, traders may be on the look out for a dead-cat bounce to fade.



Data from Refinitiv. Index names may not reflect tradable instruments and not all markets are available in all regions.

Equity Brief:

  • Democrats launched a formal impeachment inquiry into Donald Trump, although this could be the slow path to nowhere as it will require at least 20 Republican’s to flip on Trump to officially oust him. After no doubt many investigations. S&P500 E-mini futures are taking it all within stride and trade slightly higher on the session.
  • Still, it didn’t prevent the ASX200 rolling over at the open and equities across Asia are mostly in the red.  At the sector level, info tech and utilities lead the ASX200, energy and materials lag. Iron ore prices also weighed on miners, with iron ore producer Mount Gibson Iron falling over 8% on the session. At the other end of the board is Afterpay Touch Group, which rallied to an all-time high after filing its external audit report, which found no evidence of money laundering or terrorism financing activity. The broader ASX has seen 31.4% stocks advance, 45.5% decline and 23.1% unchanged.
  • The Hang Seng Index is the biggest decliner among the indices we closely track and currently trades at a 3-week low. The Nikkei sank to a 5-day low (although mean reversion appeared overdue anyway) whilst China A50 and Kospi 200 remain relatively unscathed relative to their cycle highs.




Up Next

  • Fed voting members Evans, Brainard and George are all due to speak later, so USD pairs and indices could react to any policy related comments (less dovish is likely good for stocks or more hawkish less so).
  • With no major economic data released, it will be any headlines surrounding Brexit or Trump’s impeachment proceedings which are likely to move markets to any notable degree.




Disclaimer

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

GAIN Capital Singapore Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the GAIN Capital group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), GAIN Capital Singapore Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact GAIN Capital Singapore Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither GAIN Capital Singapore Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

GAIN Capital Singapore Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.

Important Notice:

Cryptocurrencies are not legal tender currency and trading of derivatives on Cryptocurrencies are currently not covered under any regulatory regime in Singapore. Consequently, investors should be aware they do not have protection under the Securities and Futures Act (Cap. 289). Please ensure that you are fully aware of the risks.