EQUITIES: New Highs for E-mini S&P
Aug-15 09:02
This morning saw new record highs in the e-mini S&P, extending gains on the clearance of resistance through the 6477.31 mark. This cements the underlying uptrend, exposing projection levels into 6523.63 next. The bounce off post-NFP lows in global equity indices persists, with the Eurostoxx 50 future recovering back above the 50-day EMA. Markets look to build a base above this level, through which additional strength refocuses attention on 5486.00, the May 20 high and bull trigger.
- Japan's NIKKEI closed higher by 729.05 pts or +1.71% at 43378.31 and the TOPIX ended 49.73 pts higher or +1.63% at 3107.68.
Elsewhere, in China the SHANGHAI closed higher by 30.328 pts or +0.83% at 3696.771 and the HANG SENG ended 249.25 pts lower or -0.98% at 25270.07. - Across Europe, Germany's DAX trades higher by 91.87 pts or +0.38% at 24468.68, FTSE 100 lower by 6.39 pts or -0.07% at 9170.84, CAC 40 up 56.25 pts or +0.71% at 7926.59 and Euro Stoxx 50 up 22.3 pts or +0.41% at 5457.
- Dow Jones mini up 311 pts or +0.69% at 45308, S&P 500 mini up 4.25 pts or +0.07% at 6494.75, NASDAQ mini down 46.75 pts or -0.2% at 23883.5.
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FOREX: Greenback Consolidating Tuesday Advance, GBP Contained Post CPI
Jul-16 08:57
- G10 currency ranges have been very contained early Wednesday, allowing the US dollar to consolidate the prior day’s broad-based advance following the release of US inflation figures. The recent USD index recovery has now extended to around 2.3% from cycle lows printed on July 01. The rally marks the cleanest evidence yet of a material break of the downtrend posted off the February high, bolstered by a clean break above the 20-day EMA.
- USDJPY moderately extended its significant upswing overnight, printing at the highest level since April 03 at 149.18. Bullish momentum was underpinned by the rising US yields and breaks above the June and May highs likely exacerbated the move. The May high around 148.65 has provided support this morning, keeping a short-term bullish theme prominent.
- the next focus will be on 149.38, the 50.0% retracement of the Jan 10 - Apr 22 bear leg, and 150.49, the Apr 2 high.
- Despite headline and core CPI in the UK surprising to the upside, we think the BOE will largely describe inflation in the August MPR as broadly in line with their forecast. This explains the very limited reaction for GBP this morning, as markets assess the upcoming labour market data on Thursday and bearish technical developments for the pound.
- GBPUSD breached important trendline support below 1.3430 yesterday, drawn from the Jan 13 low. A clear break of the trendline strengthens a bearish threat and exposes 1.3335, the May 20 low.
- The data focus later today will be on US PPI, industrial production and the Fed’s beige book. There are also various FOMC speakers expected.
BONDS: Bonds Off Lows As Technical Supports Hold & Oil Softens
Jul-16 08:52
A downtick in crude oil helps stabilise wider core global FI.
- Technicals also play a part, with gilt futures respecting their early June low (91.16), while TY futures fail to break through Tuesday/overnight lows.
- Benchmark futures trade away from lows on the follow.
EGB OPTIONS: Bund Put Structure Trades
Jul-16 08:46
RXQ5 129 puts at 32 vs. RXV5 127 puts at 74.5-76.5 10K trades, selling the Q to buy the V, potentially rolling an existing position down and out.
