ECB: Lagarde Stresses Need To Enhance Domestic Demand; No MonPol Signals

This morning, Germany will reopen its on-the-run 7-year 2.50% Nov-32 Bund (ISIN: DE000BU27014) for the second and final time this year.

• The launch auction of the line on August 27 was very soft with only E3.170bln of bids received for the intended E4.0bln transaction. However, ahead of the first reopening came the release of the Q4 issuance plan in which it was announced today's auction would be the sole auction of the quarter for the 7-year Bund with a smaller E3bln size. That probably helped the first re-open of the line fare a little better, with a 1.48x bid-to-cover / 1.13x bid-to-offer combination and the lowest accepted price at the auction coming in above the secondary market mid-prices.
• Domestically in Germany, Finance Minister Klingbeil is scheduled to update the government's tax projections tomorrow, with current revenues likely running a little ahead of the previous plan. For detailed considerations see our post at 08:19 BST.
• The next German auction will be E4bln of the 2.20% Oct-30 Bobl (ISIN: DE000BU25059) on October 28.
• Timing: Results will be available shortly after the bidding window closes at 10:30BST / 11:30CEST.

The trend condition in S&P E-Minis remains bullish and the contract is trading above support at the 50-day EMA. The average, currently at 6627.92, has been pierced but remains intact - for now. Note that the Oct 10 low of 6540.25 marks the key short-term support. The trend direction in Eurostoxx 50 futures is up and This week’s gains reinforce this theme. The breach of 5689.00, the Oct 2 high and bull trigger, confirms a resumption of the uptrend.

• Japan's NIKKEI closed lower by 8.27 pts or -0.02% at 49307.79 and the TOPIX ended 16.93 pts higher or +0.52% at 3266.43.
• Elsewhere, in China the SHANGHAI closed lower by 2.574 pts or -0.07% at 3913.758 and the HANG SENG ended 245.78 pts lower or -0.94% at 25781.77.
• Across Europe, Germany's DAX trades lower by 64.63 pts or -0.27% at 24263.12, FTSE 100 higher by 60.69 pts or +0.64% at 9487.18, CAC 40 down 43.81 pts or -0.53% at 8214.14 and Euro Stoxx 50 down 22.8 pts or -0.4% at 5663.71.
• Dow Jones mini down 22 pts or -0.05% at 47120, S&P 500 mini up 0.5 pts or +0.01% at 6774.25, NASDAQ mini down 31.5 pts or -0.12% at 25265.75.

A sharp pullback in Gold yesterday appears corrective - for now. Note that the trend is overbought and a deeper retracement would allow this condition to unwind. Support at the 20-day EMA, at $4031.4, has been pierced. A bearish theme in WTI futures remains intact and the move down last week reinforces current conditions. Note that moving average studies are in a bear-mode position, highlighting a dominant downtrend.

• WTI Crude up $0.97 or +1.69% at $58.21
• Natural Gas down $0.03 or -0.72% at $3.453
• Gold spot down $17.97 or -0.44% at $4106.71
• Copper up $0.7 or +0.14% at $497.15
• Silver down $0.03 or -0.07% at $48.6885
• Platinum down $16.74 or -1.08% at $1530.79