FOREX News Today

European Outlook: Asian stock markets are mostly sharply down, (Nikkei closed down -1.88% and USDJPY struggles with 101.00) as risk aversion continues to dominate markets. Oil prices are slightly up on the day, but the front end WTI future is still below USD 40 per barrel amid supply concern. U.S. stock futures are also down and while the FTSE 100 future is slightly higher, concern about the global growth outlook and geo-political risk factors are weighing on sentiment. Bund and Gilt futures declined in tandem with European stock markets yesterday and after yesterday’s dip there is some room for stabilisation, though, especially in the Eurozone where the composite PMI should bring at least a slight upward revision and the final services PMI reading could also be revised up, after robust national data. The U.K. reading is likely to be confirmed in contraction territory.

US Income Report: Revealed a lean 0.2% June income rise but a sturdy 0.4% consumption gain, with a small 0.1% chain price increase that translated to a firm 0.3% “real” consumption rise with a savings rate drop to 5.3%. The annual revisions, which were mostly revealed in the last GDP report, left larger recent downward income than consumption changes, but with even larger downward tax payment revisions that left a boost in recent disposable income and savings rate figures. We left our Q3 GDP growth estimate at 2.6%, though we hiked our real consumption growth forecast to 3.3% from 3.0%, following an expected trimming in Q2 GDP growth to 1.1% from 1.2% thanks to $4 bln in downward construction revisions. In nominal terms, consumption is poised for 4.4% growth in Q3 after a 6.2% clip in Q2, with a projected 1.1% Q3 chain price rise after a 1.9% Q2 rate of climb.

Japan: Continues to remain in focus. PM Abe re-shuffled his cabinet earlier today Aso remains as finance minister; only major change was Yamamoto (a key ally of Abe) replaces Ishiba as Regional Economic Minister. Abe also announced a meeting of the Japanese Troika (BOJ, MOF and the FSA) for 06:00 GMT with an announcement to follow.

US Car Sales: Preliminary U.S. auto sales figures have been subpar and below optimistic forecasts for July so far. GM posted a sales decline of 1.9% (vs -1.0% forecast), while Ford set a 3% drop (vs -0.5% expected), Nissan sales rose 1.2% (vs 3% forecast) and Fiat-Chrysler rose 0.3% (vs 1.9%). Despite the resumption of weaker oil prices, which saw WTI sink from the $51 bbl area to dip below $40 bbl this week, Ford reported that SUV -5.6% and F-series truck sales -1% were lower. It may be a stretch to reach the 17.5 mln clip forecast if this trend continues for the rest of the automakers.

Main Macro Events Today        

• US Non-Manufacturing ISM – Service sector sentiment is out today to close out the measures of July sentiment. We expect the headline to fall to 55.5 (median 56.0) from 56.5 last month. Despite some weakness in sentiment headlines, stronger component data look poised to leave sentiment on a stronger footing in July with the ISM-adjusted average of all measures climbing to 52 from 50 in both June and May.

• UK & Euro Area Services PMI – A raft of data for all Euro area countries Services PMI’s today. Key German data at 07:55 GMT, (no change expected) followed by EURO area composite (no change expected) at 08:00 and UK (also no change expected, but our view is a miss is quite possible) at 08:30.

Janne Muta

Chief Market Analyst

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Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

FOREX News Today

European Outlook: Asian stock markets are mostly down, with the Shanghai Composite Index managing slight gains, but the Nikkei closed down -1.47% and Australia’s ASX also down, despite a rate cut from the RBA, which lowered the cash rate by 25 bp to 1.50%. Negative leads then for European stock markets which already closed in the red yesterday, which should give Bund futures some chance to recover some of yesterday’s losses. The European calendar is relatively quiet today, with only the U.K. construction PMI, the Swiss manufacturing PMI and Eurozone PPI numbers.

RBA Cuts rates by 25bp to a record low 1.50%: As expected and already largely priced in by the markets, AUDUSD fell but then immediately recovered, currently trading at 0.7548. “Moderate” repeated a lot in the statement, concerning Chinese growth, local domestic growth including housing and labour market. Key problem remains stubbornly low inflation and is expected to “remain so for some time”. The RBA report their quarterly forecast update on Friday.

Japan: Consumer confidence has slipped again, from 42.0 to 41.3 for July. Finance Minister Aso and BOJ Governor Kuroda will meet later today to “confirm cooperation over policy”. Also due today is PM Abe fiscal stimulus announcement. USDJPY 102.14 in anticipation.

US Market Reports: Yesterday they revealed only a small July ISM drop to a still-firm 52.6 from a 16-month high of 53.2 in June, and it’s now likely that the ISM-adjusted average of the major surveys will bounce to 52 in July from 50 in both May and June, as this aggregate reclaims the 52 eight-month high in March. Yet, we also saw a surprisingly weak round of Q2 construction spending figures that trimmed our Q3 GDP growth estimate to 2.6% from 2.8%, after a likely downward bump in Q2 growth to just 1.1% from 1.2%. We saw June construction drops in every major component except home improvement, after widespread downward bumps in both April and May.

Energy Action: WTI crude gapped to $40.20 lows after breaking Friday’s three-plus month base of $40.57. The contract now stands at levels last seen on April 20, when the printed base was $39.85. Fresh selling can be expected under there, with stop loss orders noted. Technically the key 50 and 200 DMA have been broken.

Main Macro Events Today        

• US Personal Income –  June personal income data is out today and should reveal a 0.3% (median 0.3%) headline with consumption up 0.3% (median 0.3%) as well. This follows respective May figures which had income up 0.2% on the month with consumption up 0.4%. Vehicle sales plunged in June but the employment report and aggregate income measure were both stronger, lending some upside risk to the release.

• UK Construction PMI – More poor data expected a fall to 44.2 from 46.0 last time is anticipated. UK home ownership now at 35 year lows as demand out strips supply and generation rent continue to enter the market.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

FOREX News Today

European Outlook: Asian stock markets mostly headed south, with Japan underperforming (closing down 1.13%) as the Yen strengthened USDJPY 10477). U.K. stock futures are also down, and oil prices remain under pressure (see more below). Bund futures already moved higher in after hour trade yesterday and are likely to open with gains, supported by risk aversion. The Fed left policy unchanged yesterday and delivered a slightly more upbeat statement, as expected, which leaves rate normalisation on the cards, but the timing of any hike remains in the dark. Today’s calendar has the last of the Eurozone’s major surveys for July, with the ESI seen falling to 104.0 (med 103.7), from 104.4 in the previous month. The risk as with the other survey is to the upside as real sector sentiment so far has weathered the Brexit referendum much better than expected. Germany has unemployment data for July, which is expected to confirm a still robust labour market, and preliminary inflation data for July, with HICP inflation seen rising to 0.3% y/y from 0.2% y/y.

Fed Tightens Statement, but Hike Timing Still Loose: The FOMC held rates unchanged and opted for a slightly more upbeat outlook, as was the risk. The Fed inserted “Near-term risks to the economic outlook have diminished,” which appeared to be a stepping stone towards reviving a “balance of risks” assessment. It also upgraded the employment picture, while cutting the expansion back to a “moderate rate,” and remaining wary of the inflation shortfall. All told, the statement nudged the markets a tiny step closer to resumption of normalization, but specific timing remains a mystery.

US Market Reports: The U.S. durables report was disappointing across the board, given a huge 4.0% June headline orders drop with a 0.5% ex-transportation decline after downward May revisions, alongside weak equipment orders and shipments figures, and a sixth consecutive inventory drop. We lowered our Q2 GDP growth estimate to 2.5% from 2.7%, with a 3% (was 5%) clip for real equipment spending. We expect a $23 (was $19) bln Q2 inventory subtraction that leaves a slightly elevated $45 bln accumulation rate, following three consecutive quarterly subtractions of $10.0 bln in Q1, $7.2 bln in Q4, and $28.0 bln in Q3. We expect a 0.1% June factory inventory drop with a 0.1% total business inventory rise, given today’s 0.2% factory durable inventory decline. We assume a 1.7% June factory orders drop with a 0.5% factory shipments increase, given an assumed 0.6% price-led nondurable shipments and orders rise. The factory durable inventory-to-sales (I/S) ratio fell to 1.64 from 1.65 in April and May as we continue to unwind the December spike to 1.68, versus a 1.70 three-year high in February of 2015 and a 1.59 recovery-low in November of 2013.

Energy Action: WTI crude crashed to three-month lows of $42.11 from over $43.10 following the EIA inventory data which showed a 1.7 mln bbl rise in crude stocks. The street had been expecting a 2.0 mln bbl decrease. Meanwhile, gasoline supplies, seen flat actually rose 0.5 mln bbls, while distillate stocks were down 0.8 mln bbls, versus expectations for a 0.5 mln bbl increase. Refinery usage fell to 92.4% from 93.2%. The report is bearish on the crude and gasoline fronts, with inventories remaining above historical averages for this time of year. Overnight the contract has continued to weaken and traded as low as $41.66 before recovering to a little under $42.

Main Macro Events Today        

• US Initial Jobs Claims U.S. initial claims data for the week of July 23 is out Thursday and should reveal a claims increase to a 262k (median 260k) headline following a 253k headline in the week of July 16 and 254k in the two weeks prior to that. July is typically a volatile month as we move through auto retooling season. We expect a stronger July average of 255k compared to 265k in June and 276k in May.

• Japanese Data – A raft of Japanese data later (Thursday into Friday) including CPI, Unemployment rate Household Spending, Industrial Production and some Retail figures. Together with the BOJ Statement.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.