Your morning market update includes some support for the US dollar and a huge day for gold.
– Interesting data overnight with weakness in the UK but strength in the US. In the UK, retail sales fell 0.9% in August against expectations of a rise of 0.4% and from 1.1% in July. This knocked GBP from a high at 1.6152 to sit currently at 1.6030. Across the pond, Jobless Claims in the US printed a credible 309,000 which was higher than last week’s 294,000, but the context is there were difficulties for some states lodging claims, so this is a very strong number. Equally strong was the Philly Fed manufacturing index which printed 22.3 versus 10 expected, while existing home sales rose 1.7% versus -2.6% expected.
– It all added up to a bit of strength for the US dollar, a little weakness for US stocks – unsurprising after yesterday’s moves anyway – and a back up in US yields. At the close the Dow (-0.25%) and S&P 500 (-0.2%) were marginally lower while the Nasdaq rose 0.14%. Rates in the US backed up 6 pts to 2.75%.
– Prior to this though, Europe played catch-up with rises across the board. The FTSE rose 1.01%, DAX up 0.67%, CAC up 0.85% while Milan and Madrid rose 1.43% and 1.01% respectively. European rates also sold off, rising 7 points in Germany to 1.93% and 11 points in the UK to 2.72%.
– On FX markets, the Aussie dollar couldn’t sustain yesterday’s rally amidst a generalised surge in the US dollar. At 0.9435, the AUD is off 0.86% on the day but still trails the move in the Yen, which lost 1.47% against the USD with USDJPY back up at 99.37. Sterling lost 0.68% but Euro is largely unchanged at 1.3530.
– On Commodity markets, Nymex crude fell 1.68% to $106.25, Gold had a huge day, trading up to $1368 presently for a gain of 4.71% while Silver ripped 8.03% higher and Copper jumped 2% to $3.35 lb. In the Ags, Corn rose 0.82%, Wheat jumped 1.62% while Soybeans fell 0.50%.
– On the Sydney Futures Exchange, the SPI200 futures for the December contract are off 15 points while both 10- and 3-year bonds are off 7 points, implying a rise in yields of the same magnitude today.
– With China out today and virtually no decent data it should be a fairly quiet day. Foreign investment in Japan, Kiwi visitor arrivals, Italian Industrial data and then three speeches from the Fed which might actually add a bit of weekend excitement tonight.
Follow Greg McKenna on Twitter
NOW WATCH: Money & Markets videos