EU CONSUMER CYCLICALS: LVMH: 3Q earnings (x3)
Oct-15 09:55
(MCFP; Aa3/AA-/NR)
Asides from call below. Worth noting it opened 'The Louis' in Shanghai - a flagship store shaped and sized like a ship. Also worth noting FX increased to a 4% headwind this quarter (Kering generally faces a similar headwind). Kering up to -9, Burberry £30s unch.
- Chinese cluster: Improving but still LSD negative (tourist spend DD neg.; local spend mid- to HSD positive). Americans slightly up; Europeans flat.
- Louis Vuitton (core brand) ran slightly above group average.
- 2H gross margin still hinted at being down y/y. It says it needs positive revenue growth for it to stabilise (net of FX revenue still -4%)
- It is cautious on 4Q growth in the US as it rolls over a tougher +3% comparable from last year - that was on post election consumption surge.
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OAT: Block trade
Sep-15 09:54
OAT Block trade, suggest seller:
- OATZ5 ~3.34k at 121.74.
OUTLOOK: Price Signal Summary - GBPUSD Tests Resistance
Sep-15 09:44
- In FX, the trend theme in EURUSD remains bullish and the pair is trading closer to its recent highs. Resistance at 1.1743, the Aug 22 high, has recently been cleared reinforcing a bull cycle. This signals scope for 1.1829, the Jul 01 high and bull trigger. Clearance of this hurdle would confirm a resumption of the primary uptrend. Support to watch is the 50-day EMA, at 1.1639.
- A bullish theme in GBPUSD remains intact and price is trading at its recent highs. The rally that started Sep 3 has retraced the steep Sep 2 sell-off and highlights a stronger bullish development. This confirms the corrective cycle between Aug 14 - Sep 3 is over. Sights are on resistance at 1.3595 (pierced), the Aug 14 high and a bull trigger. A clear break of it would strengthen a bullish condition. Initial support to watch is 1.3475, the 50-day EMA.
- USDJPY continues to trade inside a range. Key short-term support to watch is 146.21, the Aug 14 low and a bear trigger. A break of this level would highlight a stronger bearish threat and a range breakout. This would expose 145.40, 50% of the Apr - Aug upleg. On the upside, clearance of 149.14, the Sep 3 high is required to reinstate a bullish theme. Note that moving average studies are in a bull-mode position, highlighting a dominant uptrend.
FOREX: AUDUSD Consolidating Recent Breakout, Eyes Nov 07 Highs
Sep-15 09:43
- The dollar index has operated within a 21 pip range on Monday, as markets await a stacked data and central bank calendar this week, headlined by the Fed. While moves remain moderate, the likes of AUD and GBP are outperforming early Monday in G10 FX.
- This has allowed AUDUSD to rise back towards cycle highs. Last week’s gains plus the breach of 0.6625, the Jul 24 high and bull trigger, confirmed a resumption of the technical uptrend, and the pair has narrowed the gap substantially to the US election related highs at 0.6688. Moving average studies are in a bull-mode position highlighting a dominant uptrend and sights will be on 0.6729, the 1.236 projection of the Jun 23 - Jul 11 - 17 price swing.
- JP Morgan have noted the AUDUSD impulsive rally has lifted the pair into the 0.6658-0.6722 resistance zone. This includes the Nov 2021 trend line and the confluence of medium-term Fibonacci retracement levels. While JPM suspect the pair can pause near that resistance, there is no evidence that the rally is exhausted at this point.
- Separately, it is worth highlighting that this morning’s high for AUDNZD has matched a very significant resistance point for the cross at 1.1180. A breach of the level would place the cross at the highest level since late 2022, and above here, 1.1250 marks the next notable level, the 76.4% retracement point of the 2022 selloff. We noted last week that BofA forecasts imply further AUDNZD appreciation, and they have a current 2026 year-end forecast of 1.15.
