EU BASIC INDUSTRIES: Imerys: Q3 Results (NK; Baa3/BBB-/NR)
Management says market is still weak.
• Revenue EU 827m -3.3% reported; -1.3% Organic
• Adj EBITDA EU 140m -5.7% yoy
• Margin 16.9% down from 17.4%.
• Excluding JVs 9M EBITDA EU421m was in line with last year. JV contribution fell from EU89m to EU20m.
• Confirms Outlook of Adj EBITDA 540-580m down from EU 675m FY24.
• Says market recovery is delayed so will implement cost reduction.
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EURUSD TECHS: Monitoring Support
- RES 4: 1.2063 2.236 proj of the Feb 28 - Mar 18 - 247 price swing
- RES 3: 1.2000 Round number resistance
- RES 2: 1.1919/23 High Sep 17 / 2.0 proj of Feb 28 - Mar 18-27 swing
- RES 1: 1.1755/1820 High Sep 29 / 23
- PRICE: 1.1730 @ 16:26 BST Sep 29
- SUP 1: 1.1646 Low Sep 25
- SUP 2: 1.1574 Low Aug 27
- SUP 3: 1.1528 Low Aug 5
- SUP 4: 1.1392 Low Aug 1 and bear trigger.
The trend theme in EURUSD remains bullish and the recent pullback appears corrective. Attention is on support at 1.1682. the 50-day EMA. It has been pierced, a clear break of this average would signal scope for a deeper retracement and expose 1.1574 initially, the Aug 27 low. For bulls, a clear resumption of gains would refocus attention on 1.1923, a Fibonacci projection. Initial firm resistance to watch is 1.1820, the Sep 23 high.
FOREX: AUD and JPY Lead G10 Advance as Dollar Dips Further
- Bearish dollar momentum continues to be a function of concerns related to the potential US government shutdown, which President Trump has said will probably occur. Haven demand for the Japanese yen has prompted USDJPY to fall another 0.5%, while a moderate hawkish tilt to the September RBA meeting promotes AUD to the top of the G10 leaderboard.
- USDJPY traded to a low of 147.66, with spot narrowing the gap to initial support which lies at 147.59, the 50-day EMA. Stronger pivot support has been defined at 145.49, the Sep 17 and post-Fed low.
- The broad dollar weakness has boosted AUDUSD back above the 0.66 handle on Tuesday. RBA Governor Michele Bullock declined to say whether the central bank retains an easing bias after the Board held the cash rate at 3.6%, stressing that future moves will depend on incoming data, with the current level still viewed as slightly restrictive.
- Overall, the AUDUSD uptrend remains intact and recent weakness appears to have been a correction. Initial firm resistance to watch at 0.6628 has been met today and will be closely monitored ahead of the APAC crossover. A stronger reversal higher would refocus attention on 0.6707, the Sep 17 and post-Fed high.
- Price action prompted another impressive surge for AUDNZD, rising to a fresh cycle high above 1.14, continuing to narrow the gap with the 2022 highs located at 1.1491.
- US data did little to spur volatility in currency markets. Job openings were relatively steady in August in the latest JOLTS report, but secondary metrics suggested further loosening in labor market conditions. Consumer confidence was weaker-than-expected.
- On Wednesday, the first focus will be on Japan’s Q3 Tankan Survey. Eurozone inflation data, US ADP employment and the ISM manufacturing PMI release are all scheduled.
OPTIONS: Busy Session For Euribor Call Buying, Larger Bund Put Purchase
Tuesday's Europe rates/bond options flow included:
- RXX5 125p, bought for 2 in 10k
- ERH6 98.0625/98.1875cs vs 97.875p, bought the cs for 1.25 in 7k total
- ERH6 98.25/98.12/98.06/97.81p condor, bought for 0.75 in 2k
- ERH6 98.00/98.06/98.12/98.18c condor, bought for 0.25 for 4k
- ERM6 98.37c, bought for 3.25 in 12k
- 0RX5 98.06c vs 0RV5 98.00c, bought the Nov for 1 and 1.25 in 10k Total.
- SFIZ5 95.95/96.25^^, bought for 2 in 2k
- SFIF6 96.25/96.15ps 1x2, bought for 1.5 in 1k.
- SFIZ6 96.25/96.75/97.00cfly vs SFIM6 96.00p x2, traded 7.75 for the fly in 2.5k
