GERMAN DATA: September Factory Orders Strength Partly 'Core' Driven
Nov-06 08:32
MNI (LONDON) - German factory orders surprised to the upside in September, at 4.2% M/M (vs +1.5% cons). August's print was revised by +0.4pp to -5.4%. While the headline figure was driven higher by less persistent large-scale one-offs, also underlying 'core' orders looked solid this month. Despite the monthly rise, sentiment remains close to cycle lows - so the slightly stronger September print should bring little change for the overall bleak picture in German manufacturing.
- Underlying ‘core’ orders (excl. large-scale one-offs) rose 2.2% M/M.
- Destatis specifically mentions strong one-off revenues in the airplanes, ships, trains, and military vehicles category - those will have at least somewhat driven the difference between the core and headline category.
- On a regional split, the picture looks mixed: orders from the eurozone jumped (+14.6% M/M), non-EZ foreign orders declined 1.6% M/M, and domestic orders rose 3.6%.
- Real turnover in manufacturing, which can provide some signal for the September industrial production release (due tomorrow), was -1.4% M/M and -4.4% Y/Y. Current consensus for September IP stands at -1.0% M/M (+2.9% prior) and -3.0% Y/Y (-3.0% prior) - so there may be some slight downside risks to tomorrow’s print.
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OPTIONS: Expiries for Oct07 NY cut 1000ET (Source DTCC)
Oct-07 08:22
- EUR/USD: $1.0950-55(E1.4bln), $1.0990(E535mln), $1.1100-15(E2.3bln), $1.1265(E1.1bln), $1.1300(E875mln)
- USD/JPY: Y143.00-05($2.1bln), Y143.20-30($2.8bln), Y144.00($3.3bln), Y144.50($2.0bln), Y144.75-85($1.5bln), Y145.00($2.1bln), Y145.75-95($1.2bln), Y146.85-00($1.7bln)
- AUD/USD: $0.6755(A$500mln), $0.6900(A$994mln)
OIL: Oil Back Towards Friday Highs Following Death Of Israeli Hostage
Oct-07 08:05
Brent & WTI rally in early London trade, adding to the weakness in bonds.
- The move followed news of the death of an Israeli hostage held by Hamas.
- Friday’s highs in both Brent ($79.30) & WTI ($75.57) present initial resistance.
- Our commodities team note that markets wait for Israel’s response to Iran’s missile attack. Earlier Iran cleared its airspace but the country has since opened some airports.
- Israel continued to strike targets in Lebanon and Gaza over the weekend.
- The market weighs the risk of a strike by Israel on Iran’s oil facilities and further escalation to the area that could impact both oil and gas supplies. The U.S. is urging Israel to avoid Iran’s oil infrastructure.
- Goldman Sachs estimates that Brent could increase to the $90s if Iranian oil production was hit but upside would be dependent on if OPEC offset any lost supply.
AUD: AUDJPY paring further gains
Oct-07 07:54
- The Aussie is still paring gains against the JPY, printing fresh lows and eyeing a test all the way back to 100.27, where AUDJPY was trading pre US NFP on Friday.
- While the Aussie falls against the Yen, it is testing through Friday's high versus the NZD and look to test the next immediate resistance at 1.1057.
- A clear break through would open to 1.1090.
