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Wall Street dumps on trade uncertainty, data
US indices slumped yesterday amid a lack of noticeable progress in the trade talks as the December 15 deadline for the next round of tariffs nears. Weak US PMI data added to the pressure as most indices fell the most in about two months. The RBA is expected to keep rates unchanged at today’s policy meeting.
US30USD Daily Chart
The US30 index fell for a third straight day yesterday, dropping the most since October 2 to hit the lowest level in ten days
The 55-day moving average has risen to 27,200, edging higher toward possible trendline support around the 27,230 level
The ISM manufacturing PMI fell to 48.1 in November, confounding analysts’ expectations of an improvement to 49.2. The are no tier-1 data releases scheduled for today.
DE30EUR Daily Chart
The Germany30 index slumped to the biggest daily loss in two months yesterday amid weak sentiment on Wall Street and as the leadership contest in Germany’s SPD party raised fears of an early general election
The index traded below the 23.6% Fibonacci retracement of the rally from October 3 to November 12 at 12,960 for the first time since November 4. The 55-day moving average has risen to 12,771
Yesterday’s final readings for the Markit manufacturing PMIs for both Germany and the Euro-zone suggested some stabilization after being revised higher from the flash estimates. Today’s data calendar has only Euro-zone producer prices for October and a speech from ECB’s Coeure on tap.
AU200AUD Daily Chart
The Australia200 index has fallen to the lowest level in 11 days in early trading this morning ahead of the RBA rate decision
The index is headed toward the 55-day moving average at 6,702, which has supported prices on a closing basis since October 10
The RBA is widely expected to keep its benchmark rate unchanged at 0.75%, according to the latest survey of economists. The last meeting was a closer call than expected, the minutes showed, with a lengthier discussion about cutting rates. There is a small chance of a surprise cut today.
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A seasoned professional with more than 30 years’ experience in foreign exchange, interest rates and commodities, Andrew Robinson is a senior market analyst with OANDA, responsible for providing timely and relevant market commentary and live market analysis throughout the Asia-Pacific region. Having previously worked in Europe, since moving to Singapore he worked with several leading institutions including Bloomberg, Saxo Capital Markets and Informa Global Markets, proving FX strategies based on a combination of technical and fundamental analysis as well as market flow information. Andrew began his career as an FX dealer with NatWest and the Royal Bank of Scotland in the UK.
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