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Weekly Market Commentary
Markets were boosted to close a positive week, last Friday, as the US and China approached finalising Phase 1 of the US/China trade deal. Officials were confident of completing the trade deal and ready to have a 'signing ceremony'. This boosted markets across the US and promises a robust beginning to the new week. The coming week is a virtual avalanche of global economic data and Central Bank monetary policy decisions. The FOMC meet this coming week, along with the Bank of Japan and the Bank of Canada, who are expected to extend QE and perhaps cut interest rates. US Employment numbers will be important measures, including the Non-Farm Payrolls, Challenger and ADP reorts, which should reinforce the strength of the US labour market. Confidence and Sentiment should be high, going in to the new week, which should boost equities and demand.
The Brexit slow motion train wreck is going to continue, with the exit scheduled for the 31st of October, Halloween. The UK 'remain' Parliament refuse to execute the will of the British people, who voted more than 3 years ago to leave in the referendum. The Parliament refused a 'Brexit No Deal' and now refuse a 'Brexit Deal'! The only unity is against Brexit and now they refuse to go to a General Election, as many heads would roll as a consequence. It is a tragedy of democracy and has damaged the institution and the British economy, in the process. The GBP continued to lose ground, trading down to 1.2825, while the EUR slipped back to 1.1070.
Commodity currencies have been resurgent, on the back of developments on the US/China trade front, but suffered a setback on Friday. The NZD fell back to 0.6350, after strong rally during the week, while the AUD traded 0.6820. The NZD may come under some pressure this coming week as the Business Confidence number continues to hit record lows, damaging the currency and sentiment. The US/China trade deal is seen as a net boost to these trade exposed currencies, but the devil remains in the detail. The huge increase in US Exports to China must have some consequence on these commodity, export driven economies and currencies.
Weekly Market Calendar 28/10 UK House Prices, US Trade, Chicago Fed National Activity
29/10 Dallas Fed Manufacturing Activity, Australia Consumer Confidence, Japan CPI, S&P Case Shiller Home Prices Index
30/10 US Consumer Confidence, US Pending Home sales, Japan Retail Sales, Australia CPI, France GDP, German Unemployment, EU Consumer Confidence, US Weekly Mortgage Applications, ADP Jobs Report, US GDP, German CPI
31/10 German Retail Sales, Bank of Japan Rate Decision, Bank of Canada Rate Decision, FOMC Meeting, NZ Building Permits, Japan Industrial Production, NZ Business Confidence, Japan Consumer Confidence, Australian Building Approvals, China Manufacturing/Composite/Non-Manufacturing PMI, Japan Consumer Confidence, Japan Home Sales, EU CPI, EU GDP, EU Employment, Italy GDP, Challenger Jobs Report, Canada GDP, US Weekly Jobless Claims, US Personal Income/Spending, Chicago Purchasing Manager
1/11 NZ Consumer Confidence, Australia Manufacturing PMI, Japan Manufacturing PMI, China Manufacturing PMI, Non-Farm Payrolls, US Unemployment, US ISM Manufacturing
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