Ranges (Up till 12.
00pm HKT)
Currency
Currency
EURUSD
1.1183-1.1206
EURJPY
134.74-91
USDJPY
120.34-61
EURGBP
0.7211-18
GBPUSD
1.5500-27
USDSGD
1.4095-1.4141
USDCHF
AUDUSD
0.9713-23
0.7123-48
USDTHB
USDKRW
35.85-96
1174.8-1180.0
NZDUSD
0.6308-31
USDTWD
32.639-33.00
USDCAD
1.3232-57
USDCNH
6.3985-6.4070
AUDNZD
1.1268-1.1311
XAU
1133.4-1134.7
Key Headlines
Japanese market is still closed today - Asia
opening has been calm. I am hearing that Jpy
repatriation talk has begun to surface as we
move towards next weeks FY-end. No mention
of names or amount but hearsay pretty decent
and close.
Some mentioned of very decent AudUsd demand
located near and towards 0.7100. Well, not a
surprise. There is a 0.7100 option strike expiring
on Sept 30, notional worth Aud3.65bn.
Our trader Sam likes UsdCad higher but noted
that in rates space, UsdCad seems expensive. On
the day, he likes to get long Usd nearer to
1.3200-20.
FX Flows
Japanese market is still closed today - Asia opening has
been calm.
EurUsd struggled in this 1.1183-94 amid overnight
comments by Fed Res Dennis Lockhart and ECB's chief
economist Praet. Short term speculators have their offers
scattered above 1.1225 and pain above 1.1260. Short
positions also have their bids under 1.1165.
This 200-day SMA in UsdJpy at 120.88 is indeed
daunting. Short guys are also echoing offers at 120.75 for
offshore names. Japan will reopen on Thurs and I am
hearing that Jpy repatriation talk has begun to surface as
we move towards next weeks FY-end. No mention of
names or amount but hearsay pretty decent and close.
Chatter of bids close to 120.00 linked to option gamma
play.
Some mentioned of very decent AudUsd demand located
near and towards 0.7100. Well, not a surprise. There is a
0.7100 option strike expiring on Sept 30, notional worth
Aud3.65bn. Second quarters house prices were stronger
but muted in the FX space.
Toronto ended UsdCad at 1.3255; stop buy orders gather
above 1.3260 were spared as Usd trimmed. Corporate
bids are noticed from 1.3220s down to 1.3180s. First
publish in FT, the Wood Mackenzie report has gained a
lot of attention, that new oil and gas production worth
$1.5trln are at risk due to the weak oil prices. The
research company cited projects are uneconomic at
current prices of less than $50.
Our trader Sam likes UsdCad higher but noted that in
rates space, UsdCad seems expensive. On the day, he
likes to get long Usd nearer to 1.3200-20.
Asians
An interesting economic release today that Asia will
focus on is the Malaysia Foreign Reserves. There is no
time stamp and the previous number published on Sept
15 was $94.7bn. This number has been declining since
June 2015; smaller number will reveal the FX
intervention activity from BNM.
Usd/Asia opened up firm and main focus was on the
UsdMyr. Despite oil recovering, Malaysian Ringgit could
not strengthen. There are a lot of rumour from onshore
not able to mention here. Market is concerned about
remarks from BNM Governor Zeti (that public wants
answers to these questions, and they deserve to get the
answers). Our traders will be watching onshore spot at
4.3000.
Last week, we read reports of economists predicting
technical recession in Singapore; Q3 Advanced GDP will
be announced in Oct between 10-14; our strategist
Patrick Bennett believes Singapore needs to shift
towards the services industry to drive the economy.
UsdSgd rose very quickly to 1.4141 on back of short
covering.
News & Data
Australia ANZ Roy Morgan Weekly Consumer
Confidence Index 114.5 from 105.3
Australia Q2 House Price Index Q/Q up 4.7%
from 1.6%
Australia Q2 House Price Index Y/Y up 9.8%
from 6.9%
FT: Sweetness of Mint economies still entices
Mexico, Indonesia, Nigeria and Turkey it was clearly a
blessing to be marketed as the next big thing. Many
investors thought the Mints sounded simply delicious.
This was another group of four countries with the
characteristics that defined the original Brics: large
populations, strong growth rates, rapidly emerging
middle classes and entrepreneurial cultures. The past 18
months, however, have been disillusioning for fans of
both the Brics and the Mints. Brazil, South Africa and
These information have been obtained or derived from sources believed to be reliable, but I make no representation or warranty as to their accuracy or completeness.
Copyright 2013 The Poon Report by Vincent Poon. All rights reserved.
Russia are in the middle of economic crises and China is
growing at its slowest pace for a generation.
[Link]
WSJ: Bank of Canadas Poloz: Canada Can Adapt
to Lower Commodity Prices
Bank of Canada Governor Stephen Poloz rejected the
notion that Canada is over-reliant on natural resources,
such as oil, or is plagued by the so-called Dutch disease,
when a country becomes so dependent on natural
resources, it allows other industries to atrophy. Were a
highly diversified economy, he said, noting that 20% of
Canadian gross domestic product is resource related.
Youve got to believe its better to have some of this
stuff, than not to have this stuff. Poloz said Canadas
floating exchange rate helps cushion against some of the
effects of commodity-price changes. Thats because the
lower Canadian currency, especially against the U.S.
dollar, makes Canadas exports more competitive.
[Link]
Telegraph: Oil price rebounds as Opec forces US
drillers to cut back
Oil prices are back on the rise after more evidence
emerged that Opecs war on its supply rivals is taking
affect. Opec has targeted US shale oil operators, which it
believes pose a threat to the groups dominance of world
oil markets. Opec pumps about a third of the worlds oil
supply but has allowed prices to fall in a move thought to
be aimed at higher-cost producers such as US shale and
the North Sea.
[Link]
gy/oilandgas/11880006/[Link]
FT: Clinton pledge on drug prices knocks $15bn
off biotechs
Hillary Clinton, the Democratic presidential frontrunner,
knocked $15bn from the value of US biotech stocks on
Monday by pledging to take on outrageous pricegouging in the pharmaceuticals industry. Price gouging
like this in the specialty drug market is outrageous.
Tomorrow Ill lay out a plan to take it on, Mrs Clinton
wrote in a tweet, referring to a company that hiked the
price of a medicine for a form of parasitic infection from
$13.50 to $750 overnight.
[Link]
WSJ: Xi Jinpings Tech Battle in Seattle
Meetings with U.S. business leaders are usually a feelgood exercise for foreign politicians visiting America.
But when Chinese President Xi Jinping sits down with
tech CEOs in Seattle Tuesday, he is likely to hear some
pointed complaints. Chinas increasing resort to
protectionism has turned the U.S. business lobby, once
Beijings ally in Washington, into a critic. President
Obama is considering financial sanctions on Chinese
firms that have benefited from stolen technology. Those
are unlikely to be announced while Mr. Xi is a guest. But
they would be a useful warning to Beijings mercantilist
ministries. Intellectual property is increasingly the core
asset of modern companies, and Beijings efforts to steal
or extort it pose a threat to global trade that the U.S.
cant ignore.
[Link]
Telegraph: No sign of runaway inflation, despite
'robust' UK growth, says Bank deputy
Britain's "robust" recovery has not caused price
pressures to build in the economy, according to the Bank
of England's deputy governor, who suggested that
disinflationary forces from abroad meant there was no
immediate need to raise interest rates. Sir Jon Cunliffe
said the sharpest drop in unemployment for 40 years,
record high consumer confidence and the pretty strong
outlook for UK growth were being overshadowed by
powerful disinflationary forces from countries such as
China, which were keeping inflation far from the Banks
2pc target.
[Link]
NY Times: Malaysias Leader, Najib Razak, Faces
U.S. Corruption Inquiry
The embattled prime minister of Malaysia, facing
mounting political turmoil and a parade of inquiries at
home and abroad into a sovereign wealth fund that he
oversees, is now coming under the scrutiny of American
investigators as well. A federal grand jury is examining
allegations of corruption involving the prime minister,
Najib Razak, and people close to him, according to two
people with knowledge of the investigation. The inquiry,
being run by a unit of the Justice Department that
investigates international corruption, is focused on
properties in the United States that were purchased in
recent years by shell companies that belong to the prime
ministers stepson as well as other real estate connected
to a close family friend.
[Link]
[Link]?
hp&action=click&pgtype=Homepage&module=firstcolumn-region®ion=top-news&[Link]=topnews&_r=0
These information have been obtained or derived from sources believed to be reliable, but I make no representation or warranty as to their accuracy or completeness.
Copyright 2013 The Poon Report by Vincent Poon. All rights reserved.
Telegraph: Greece's new government 'doomed to
fail' over flawed bail-out
Investors cheered the return of Alexis Tsipras as Greece's
new prime minister despite concerns that the new
government was doomed to fail in its bid to keep the
country in the eurozone. Economists warned that the
left-wing Syriza party - who lost only four seats in
Sunday's general election - would struggle to jump
through the hoops of an 86bn bail-out programme.
Athens faces a punishing schedule over the next few
months, where it will be required to pass 60 "prior
action" laws through parliament by the end of the year.
These include hiking taxes on food, hotels and baked
goods.
[Link]
84/[Link]
BBC: China protests by Fanya Metal Exchange
investors
Hundreds of Chinese mineral investors have protested in
Beijing, alleging they have been defrauded. They claim to
have lost money after investing in the Fanya Metal
Exchange in the city of Kunming. Hundreds of
thousands of people have invested billions in products
offered by the exchange as the values of rare metals rose
in recent years.
[Link]
These information have been obtained or derived from sources believed to be reliable, but I make no representation or warranty as to their accuracy or completeness.
Copyright 2013 The Poon Report by Vincent Poon. All rights reserved.