Tin tức thì trường

• Our primary focus will be on building resilience and competitiveness - including with our allies and partners - on diversifying markets, and limiting impact of Beijing’s harmful practices
• It’s important that China live up to commitments and promises it’s made under phase one trade deal
• President Biden is going to hold China to account where China is falling short of its commitments
• President Biden believes that we have to use all our tools to make sure China’s economic and trade policies do not hurt American workers and businesses
• At USTR, we are taking some specific actions to begin to realign our trade policies towards China: 

1. First, we will revisit phase one agreement and emphasize that China must follow through on the commitments it has made;
2. Second, we will start a targeted tariff-exclusion process. We will also keep open potential for additional exclusion processes in the future
3. Third, in the coming days, Ambassador Tai will resume direct engagement with her counterpart in China;
4. And finally, we will work with our allies and like-minded partners towards building international trading system that is fair and allows for healthy competition;
   

• I want to make a couple of points very clear as we turn to our next steps in our trade relationship with China:

1. First, our objective is not to escalate trade tensions with China or double down on the previous administration’s flawed strategy;
2. Second, at the same time, where China continues to pursue its unfair and coercive practices, we will use the full range of our tools to help ensure that U.S.-China trade relationship works for American workers, our industries, and our supply chain;
3. And third, while we would welcome China changing the practices that do harm to American firms and workers, we recognize that China simply may not change and that we have to have strategy that deals with China as it is, rather than as we might wish it to be

• Inflation is higher than U.S. has seen for a decade
• Inflation might not fall back to the Fed's 2% goal
• My business contacts say they have had no difficulty raising prices; that raises risk of changing mentality around inflation
• Forecasts core inflation at 2.8% in 2022

The U.S. Commerce Department reported on Monday that the value of new factory orders jumped 1.2 percent m-o-m in August, following a revised 0.7 percent m-o-m increase in July (originally a 0.4 percent m-o-m advance).

Economists had forecast a 1.0 percent m-o-m jump.

According to the report, orders for transport equipment (+5.4 percent m-o-m) recorded the biggest gain in August. Meanwhile, total factory orders excluding transportation, a volatile part of the overall reading, went up 0.5 percent m-o-m (compared to an upwardly revised 0.9 percent m-o-m climb in July), while orders for nondefense capital goods excluding aircraft, a measure of business spending plans, increased 0.6 percent m-o-m instead of growing 0.5 percent m-o-m as reported last month.

Overall, durable goods orders climbed 1.8 percent m-o-m in August, while orders for nondurable goods rose 0.6 percent m-o-m.

U.S. stock-index futures fell on Monday after Friday's relief rally, as an uptick in the longer-dated U.S. Treasury yields weighed on big technology stocks.

Global Stocks:

FXStreet notes the S&P 500 Index managed to recover on Friday. Nonetheless, analysts at Credit Suisse continue to see scope for a decline to test its 200-day average at 4135.

“We look for a fall to 4243/30 – the July low, May high and 23.6% retracement of the September 2020/September 2021 uptrend – with real risk now for a test of the 200-day average, currently at 4135. Our base case remains to try and look for a floor here for an eventual resumption of the core uptrend.” 

“Our concern though is that if a top in the NYSE Composite is confirmed, this would warn weakness here can extend beyond the 200-day average to support at 4057/35.”

“A close above 4465 is needed to suggest the broader uptrend has directly resumed for a move back to 4546, then 4600/15.”

(company / ticker / price / change ($/%) / volume)

3M (MMM) downgraded to Neutral from Overweight at JP Morgan; target $210

DuPont (DD) upgraded to Overweight from Neutral at JP Morgan; target $85

Statistics Canada announced on Monday that the value of building permits issued by the Canadian municipalities declined 2.1 percent m-o-m in August, following a revised 4.1 percent m-o-m fall in July (originally a plunge of 3.9 percent m-o-m). 

Economists had forecast a 3.0 percent increase in August from the previous month.

According to the report, the value of residential permits tumbled 8.3 percent m-o-m in August, as permits for multi-family dwellings plunged 15.9 percent m-o-m, while single-family permits rose 1.2 percent m-o-m.

At the same time, the value of non-residential building permits climbed 12.3 percent m-o-m in August, reflecting jumps in institutional (+21.9 percent m-o-m) and commercial (+14.9 percent m-o-m) permits, which were partially offset by a drop in industrial permits (-7.3 percent m-o-m).

In y-o-y terms, building permits surged 16.9 percent in August.

FXStreet reports that economists at Rabobank forecast AUD/NZD at 1.03 on a three-month view.

“Any indication from the RBNZ that it could delay a second rate hike until 2022 could push AUD/NZD higher near-term. That said, we still expect the cross rate to turn lower medium-term based on the dovish position of the RBA.”

“Even on a rate hike this week from the RBNZ, there is scope for the NZD to move lower if guidance limits the potential for another rate hike this year. Last week’s high at AUD/NZD 1.0492 is likely to offer some resistance.”

“Medium-term, we expect the dovish position of the RBA to pave the way for a move towards 1.03 on a three-month view.”

• I want tax cuts but need to fix our public finances first

USD fell against most of its major counterparts in the European session on Monday, correcting downwardly after climbing to its highest levels in a year last week.

The U.S. Dollar Index (DXY), measuring the U.S. currency's value relative to a basket of foreign currencies, declined 0.23% to 93.82.

Investors now look for a crucial September jobs report, which will be released on Friday and may strengthen the case for the Federal Reserve to begin winding back its ultra-accommodative monetary policy. The last week’s releases showed a bigger-than-forecast gain in consumer spending, a surprise acceleration in manufacturing activity, and elevated core PCE inflation, supporting the Fed's move towards tightening.

The  Fed’s “dot plot”, which was released after the conclusion of the central bank's September gathering a week ago, showed that half of the FOMC members now see the first interest rate hike in 2022. At the same time, the U.S. central bank’s chairman Jerome Powell signaled that the Fed could begin scaling back its bond purchases in November and end the process by mid-2022.

In addition, markets continue to monitor developments around the Chinese troubled property developer Evergrande and the U.S. debt ceiling.

FXStreet reports that strategists at Credit Suisse note that gold (XAU/USD) remains entrenched in its range as the yellow metal extends its consolidation beneath the July and August highs at $1832/34 – but with the broader risk seen to the downside. 

“Although downward pressure is seen increasing, only below $1691/77 would mark a major top for an important change of trend lower...”

“Only a break above $1834 would be seen to complete an in-range base to clear the way for a deeper recovery to $1860, then $1917.”

“Gold arguably already moved ahead of the move higher in Real Yields, however we still see scope for 10yr US Real Yields to rise further to retest their highs seen earlier this year, which would suggest XAU/USD is likely to stay under pressure and with the base in the USD also likely to prove a headwind.” 

FXStreet notes that AUD/USD advances for the third day and economists at  Société Générale believe the pair faces initial resistance at 0.7315. 

“AUD/USD has carved out a higher trough at 0.7170 as compared to the one in August at 0.7110. It has formed a tweezer bottom at this level.”

“Holding above 0.7170, AUD/USD could attempt a bounce towards 50-DMA at 0.7315. If this is overcome, the pair could extend the up move towards a multi month descending trend line at 0.7375 and last month peak of 0.7480.”

FXStreet reports that FX Strategists at UOB Group suggest that USD/JPY could have now likely moved into a consolidative phase within the 110.30-111.7 range.

24-hour view: “We expected USD to weaken last Friday but we were of the view that ‘a break of the strong support at 111.10 appears unlikely’. We indicated that the next support is at 110.80. The subsequent weakness exceeded our expectations as USD dropped to 110.89. Downward momentum has not improved by much but USD could edge lower and test 110.80 first before the risk of a rebound would increase. Resistance is at 111.20 followed by 111.35.”

Next 1-3 weeks: “USD subsequently cracked the ‘strong support’ level at 111.10 (low of 110.89). The USD strength that started more than a week ago has come to an end. The current movement is viewed as the early stages of a consolidation phase and USD is likely to trade between 110.30 and 111.70 for now.”

FXStreet reports that economists at Credit Suisse note that GBP/USD has completed a bear “triangle” and they expect the cable to weaken towards 1.3189/35 and potentially 1.2829.

“GBP/USD has collapsed below the lower end of its converging range from late June at 1.3571/67 to complete a bearish “triangle” continuation pattern and we continue to look for further weakness to support at the 38.2% retracement of the 2020/2021 bull trend at 1.3189/35.”

“Whilst we would look for a hold at 1.3189/35 and potentially for some time, the broader risk is seen lower and beneath 1.3135 can see support next at 1.2829.”

Bloomberg reports that JPMorgan Chase & Co.’s top executive in Europe says the energy market is facing a “perfect storm,” and there’s no “certainty on when oil and gas prices will recover.”

Vis Raghavan, chief executive officer of Europe, Middle East and Africa for the Wall Street firm, said that he expects “a volatile period of rallies and corrections for a while.” But with plenty of investors on the sidelines looking for opportunities to deploy unprecedented levels of cash, “we are not at the brink of a market crash.”

He also said capital markets activity remains high, especially in equities. “Equity volumes in both cash and derivatives are still high and that momentum looks set to continue,” he said “M&A activity has been at a record and that shows no sign of abating.” Credit and rates trades are “normalizing to pre-covid levels.”

FXStreet reports that economists at MUFG Bank have made some notable alterations for the forecast profile for EUR/USD.

“We now expect EUR/USD to continue grinding lower towards the 1.1500-level by the end of this year.”

“The US dollar is expected to continue to benefit from the Fed’s hawkish policy shift. The Fed is now planning a faster pace of policy normalization than we had previously expected.” 

“The Fed has sent a clear signal that it will announce QE tapering plans “soon” which most likely means at their next meeting on 3rd November. The main risks to that timeline are posed by a more disorderly outcome from the US debt ceiling stand off and/or evidence of a sharper slowdown for the US economy.”

According to the report from Sentix, the momentum of the economic recovery in the Eurozone continues to slow down. At 16.9 points, the overall index is falling for the third time in a row. Expectations are dropping for the fifth time in a row to only 8 points. For Germany we get the first feedback after the Bundestag elections: The current assessment also slips by 5 points, while the expectations component is able to counter the global loss of momentum and even rises by 2.7 points. Overall, the signs for the global economy continue to point to a "mid-cycle slowdown". The slowdown in growth in the middle of the cycle is making headway in the major economic regions - first and foremost in the USA. The Asia ex Japan region also remains affected.

The economic recovery process continues to falter. The overall economic index for the euro area fell by 2.7 points in October to its lowest level since April 2021. This is the third decline in a row. The weakness had already been evident for some time in the expectations component. The expectations component fell for the fifth time in a row, dropping to 8 points, the same level as in May 2020. The continuing loss of momentum thus does not signal any autumn revival, which typically sets in at this time of year.

Reuters reports that ECB vice-president Luis de Guindos said that the recent rise in euro zone inflation has a structural driver in supply disruptions and the European Central Bank has to watch for any sign of second-round effects on wages.

"This inflation increase is not only responding to base effects but is also a component that is going to have a more structural impact," de Guindos said, citing supply bottlenecks, distortions in the markets for goods and services and higher energy costs.

FXStreet reports that economists at MUFG Bank expect the loonie to strengthen later next year.

“We have revised weaker our CAD projections (by around 3%) versus last month’s levels reflecting the expected move higher in US short-term yields coupled with a higher level of global growth uncertainty that may now persist into Q1 2022.”

“We have not really made much change to our assumptions specific to Canada although the level of growth of late has been weaker than what the BoC assumed. The Q3 annualised QoQ GDP assumption from the BoC was 7.3% (in July) with the market consensus now at 4.0%. Will this make much difference to the BoC’s plans on monetary policy? We don’t think so.”

Reuters reports that three OPEC+ sources said that OPEC and its allies are likely to stick to their existing agreement to add 400,000 barrels per day of oil to the market in November, despite pressure from consumers to cool a red hot market.

Ministers from OPEC+, are due to gather online at 13:00 GMT. An OPEC+ ministerial panel that monitors market developments, known as JMMC, meets before that.

FXStreet reports that the RBNZ is widely expected to hike rates at its October 6 meeting, and economists at ING believe this outcome would boost the kiwi.

“Since leaving rates on hold at the August meeting, comments by RBNZ officials have strongly suggested we’ll see a 25bp rate hike this week. In August, a lockdown announcement in New Zealand kept policymakers from pulling the trigger on tightening, now there appears to be no more ‘excuses’ to delay the first hike.” 

“Markets are currently pricing in around 80% probability of a hike, and if the RBNZ delivers as we expect, we could see some moderate support for NZD.”

Reuters reports that British finance minister Rishi Sunak said he and Prime Minister Boris Johnson did not want to raise taxes again after a recent increase in social security contributions to help fund the health service and social care.

"We made the difficult decision that we did and I think the prime minister deserves enormous credit for grappling with this long running issue of social care reform, but it's not something we did lightly, it's not something we want to do, and ideally we wouldn't have to do anything like that, again....." Sunak said.

During today's Asian trading, the US dollar consolidated against major world currencies.

Traders continue to follow the news from China related to the developer Evergrande, which is facing serious financial problems.

In general, the news that the pharmaceutical company Merck & Co has developed a drug for the coronavirus COVID-19, which can alleviate the course of the disease, had a positive effect on mood. This could potentially reduce the number of hospitalizations and deaths from the disease.

"In the foreign exchange market, we observed a strange change of positions, when at first only the dollar rose against the background of a sharp rise in yields in the US after the Fed meeting, and then followed by a more violent and sharp rally in the Japanese yen after USD/JPY jumped to new highs," the Saxo Bank said. - The latter is explained by a decrease in bond yields in the United States, which is due to a reduction in the share of borrowed funds."

According to the bank's analysts, if the sale of risky assets continues, and US government bonds remain on the sidelines and even begin to grow, the Japanese yen may bypass the US dollar as a "safe haven". "But, most likely, this will turn out to be only a short-term phenomenon, while profitability will grow further, as we assume in our baseline forecast," analysts said.

The ICE index, which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona), fell by 0.04%.

FXStreet reports that economists at Credit Suisse discuss EUR/USD prospects.

“EUR/USD has seen a conclusive move below major support from its March low and 38.2% retracement of the entire 2020/2021 uptrend at 1.1703/1.1695. This finally marks a major top and important change of trend lower, opening the door to a fall to the March 2020 high and 50% retracement at 1.1495/93.” 

“Whilst we would expect 1.1495/93 to hold at first, the size of the top suggests an eventual break lower will be seen, with support seen next at 1.1290. Whilst we would expect a fresh hold at 1.1290, we continue to see the broader risks skewed to the downside, with support seen next at 1.1020/00.”

According to the report from the Federal Statistical Office (FSO), the consumer price index (CPI) remained stable in September 2021 compared with the previous month, remaining at 101.3 points (December 2020 = 100). Inflation was +0.9%. compared with the same month of the previous year.

The stability of the index compared with the previous month is the result of opposing trends that counterbalanced each other overall. Prices for clothing and footwear increased, as well as those for heating oil and air transport. In contrast, prices for international package holidays, as well as those for hire of private means of transport decreased.

In September 2021, the Swiss Harmonised Index of Consumer Prices (HICP) stood at 101.29 points (base 2015 = 100). This corresponds to a rate of change of 0.0% compared with the previous month and of +0.8% compared with the same month the previous year. The HICP is a supplementary indicator for inflation based on a harmonised method across EU member countries. It enables inflation in Switzerland to be compared with that of European countries.

FXStreet reports that Quek Ser Leang at UOB Group’s Global Economics & Markets Research discusses US Dollar Index prospects.

“When USD Index rose above April’s high of 93.44 in mid-August, we highlighted in our Chart of the Day (19 Aug, spot at 93.45) that “the next up-leg in USD Index has likely started”. We added, “only an unlikely break of 91.80 would indicate that USD Index is not ready to head higher”. Our expectations for USD Index to head higher did not materialize as it dipped to 91.95 before rebounding.”

“Upward momentum has improved considerably and USD Index is likely to strengthen further even though strong resistance can be expected at 94.74 (high in September last year). That said, in view of the robust momentum, we are anticipating a break of 94.74. A clear break of 94.74 would increase the odds for USD Index to move above the top of the weekly Ichimoku cloud (currently at 95.00). Note that USD Index has stayed below the cloud since May last year.”

CNBC reports that Wharton finance professor Jeremy Siegel, who’s known for his positive market forecasts, is sounding the alarm on the market’s ability to cope with inflation.

Siegel warns there are serious risks tied to rising prices. “There’s going to be pressure on the Fed to accelerate its taper process,’” he said. “I do not believe that the market is prepared for an accelerated taper.”

According to Siegel, the biggest threat facing Wall Street is Federal Reserve chair Jerome Powell stepping away from easy money policies much sooner than expected due to surging inflation.

“We all know that a lot of the levity of the equity market is related to the liquidity that the Fed has provided. If that’s going to be taken away faster, that also means that interest rate hikes are going to occur sooner,” he noted. “Both those things are not positives for the equity market.”

Siegel is particularly concerned about the impact on growth stocks, particularly technology. He suggests the tech-heavy Nasdaq, which is 5% away from its record high, is set up for sharp losses.

“There will be a challenge for the long duration stocks,” said Siegel. “The tilt will be towards the value stocks.”

He sees the backdrop boding well for companies benefiting from rising rates, have pricing power and deliver dividends.

EUR/USD

Resistance levels (open interest**, contracts)

$1.1705 (2054)

$1.1666 (686)

$1.1639 (295)

Price at time of writing this review: $1.1597

Support levels (open interest**, contracts):

$1.1539 (2018)

$1.1496 (6187)

$1.1448 (376)

Comments:

- Overall open interest on the CALL options and PUT options with the expiration date October, 8 is 79608 contracts (according to data from October, 1) with the maximum number of contracts with strike price $1,2200 (8606);

GBP/USD

$1.3711 (293)

$1.3670 (190)

$1.3609 (75)

Price at time of writing this review: $1.3547

Support levels (open interest**, contracts):

$1.3495 (630)

$1.3465 (1386)

$1.3428 (1258)

Comments:

- Overall open interest on the CALL options with the expiration date October, 8 is 13041 contracts, with the maximum number of contracts with strike price $1,4150 (2064);

- Overall open interest on the PUT options with the expiration date October, 8 is 21367 contracts, with the maximum number of contracts with strike price $1,3250 (1885);

- The ratio of PUT/CALL was 1.64 versus 1.77 from the previous trading day according to data from October, 1

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.