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ECB: Draghi made clear tapering hasn't been discussed - Livesquawk
Livesquawk phoned up the ECB for comment on the taper story
"ECB will not comment on speculation but we can say that Draghi has made it quite clear that the council has not discussed this"
He made clear his position on tapering when asked the question at the last meeting.
Eurozone Markit services PMI Sept final 52.2 vs 52.1 exp
Eurozone Markit services PMI Sept final
Germany factory orders Aug mm 1.0% vs +0.3% exp
German August factory orders report 6 Oct
Better beat but euro unimpressed. Consumer goods rise notable but not reflected in Aug's retail sales data. Maybe next month.
German econ ministry say:
September NFP: US Non-Farm Payrolls Rise 156,000, Fed On Track For December Hike
The latest Bureau for Labor Statistics (BLS) report registered a 156,000 increase in non-farm payrolls for September from an upwardly-revised figure of 167,000 for August, which was originally reported as 151,000. The data was slightly weaker than the expected increase of around 170,000.
This release, in isolation, keeps the Fed on track for a December increase in rates with a generally solid release above the Fed requirements.
The three-month average slowed to 192,000 from 230,000 previously.
Private-sector employment increased by 167,000 in the month from 144,000 in August with a decline of 11,000 in government jobs after two successive monthly increases.
There was a further decline in manufacturing jobs of 13,000, but construction employment increased.
The unemployment rate increased to 5.0% compared with an expected rate of 4.9%.
The participation rate increased to 62.9% from 62.8% previously, while weekly hours recovered to 34.4 from 34.3 the previous month with the weekly hours index rising 0.4% from a 0.2% decline the previous month.
Average earnings increased 0.2% on the month with the annual increase at 2.6% from 2.4% previously, which was in line with expectations.
The employment data is an extremely important element in the Federal Reserve debate surrounding interest rates, especially as the data is at the heart of debate and division within the FOMC.
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ECB Draghi: Rates would stay low until growth picked up
Sources report on Reuters
Federal Reserve (Fed) chair Janet Yellen could provide clues on her current stance for the future timing of the next rate hike later in the session.
Yellen is scheduled to deliver a speech on “Macroeconomic Research After the Crisis” at the Federal Reserve Bank of Boston’s Annual Research Conference on Friday at 1:30PM ET (17:30GMT), according to the Federal Reserve’s website (the Boston Fed’s agenda for the conference lists Yellen as giving a keynote address at 12:30PM ET).
The speech comes after the minutes from the September 20-21 Fed meeting revealed that several voting members of the policy committee judged a rate hike would be warranted "relatively soon" if the U.S. economy continued to strengthen.
Analysts widely expect the Fed to avoid making a move in November as the meeting comes less than a week ahead of the U.S. presidential elections.
Fed fund futures currently price in the chance of a rate hike in November at just 9.3%, according to Investing.com’s Fed Rate Monitor Tool.
Most bets pointed to a December move with the odds at 69.9%.
2. Consumer data to be closely followed
U.S. retail sales data will also be in the spotlight Friday, as investors attempt to gauge if the world's largest economy is strong enough to withstand an increase in borrowing costs before the end of the year.
The Commerce Department will publish data on September retail sales at 8:30AM ET (12:30GMT) Friday. The consensus forecast is that the report will show retail sales rose 0.6% last month, after falling 0.3% in August. Core sales are forecast to inch up 0.4%, after declining 0.1% a month earlier.
Additionally, at 10:00AM ET (14:00GMT), market participants will also eye the preliminary release of the Michigan consumer sentiment for the month of October. Consensus forecasts no change to September’s reading of 82.7.
3. JP Morgan kicks off banks’ Q3 earnings season
Though markets traditionally consider Alcoa’s earnings, out last Tuesday, to be the unofficial start of the third quarter (Q3) reporting season, JPMorgan Chase & Co (NYSE:JPM) has the double duty of being the first major financial institution and the first component of the Dow Jones to release earnings on Friday.
The world’s largest bank smashed estimates in the second quarter which may imply that the market has set the bar high for the July to September period.
Experts currently expect JP Morgan to report earnings-per-share (EPS) of $1.39, compared to $1.68 in the same period last year, while revenue is expected to increase to $23.8 billion from last year’s $23.5 billion.
After JP Morgan’s earnings release scheduled for 6:45AM ET (10:45GMT), both Wells Fargo (NYSE:WFC) and Citigroup (NYSE:C) will step up to the plate at 8:00AM ET (12:00GMT).
4. Chinese inflation data provides some relief
Just as China’s trade data dampened investor sentiment a day earlier, investors found some relief Friday from economic reports on prices that suggested that the world’s second largest economy could see some renewed hopes for demand prospects.
China reported that producer prices (PPI) rose 0.1% year-on-year, compared to a decline of 0.3% expected. That was the first positive growth since February 2012.
Additionally, the consumer price index (CPI) for September showed a gain of 0.7% month-on-month, well above the 0.3% pace seen and led by food prices, and a 1.9% increase year-on-year, faster than the 1.6% rise expected.
5. Global stocks mostly higher on China data
Global stocks moved higher on Friday, erasing some losses from the previous day, as the stronger-than-expected Chinese inflation data eased some concerns about the health of the world's second-biggest economy.
European stocks registered solid gains on Friday, as the Chinese data lifted market sentiment. At 5:55AM ET (9:55GMT), the benchmark Euro Stoxx 50 traded up 1.81%, while Germany’s DAX rose 1.62% and London’s FTSE 100 advanced 0.83%
Asian stocks closed mostly higher, with the Dow Jones Shanghai managing to recover from slight losses after the inflation data was released.
U.S. futures pointed to a rebound from Thursday’s slight losses while investors stateside awaited Yellen’s appearance and economic data. Specifically, the blue-chip Dow futures rose 0.35%, by 5:56AM ET (9:56GMT), S&P 500 futures added 0.36% and the Nasdaq 100 futures gained 0.33%.
Eurozone CPI Rises 0.4% in September
According to Eurostat, the Consumer Price Index for the month of September increased 0.4%, up from a 0.2% rise in August. This was in line with analyst expectations, according to a Thomson Reuters survey.
On an annualized basis CPI was 0.4%, unchanged from August. Nineteen members of the EU showed positive annual growth rates of inflation, with Belgium leading the way higher at 1.8%. Bulgaria is experiencing deflation at a rate of 1.1% YoY.
Stripping out volatile food and energy prices, ‘core’ CPI grew 0.5%, up from the August reading of 0.3%. On an annualized basis core inflation via CPI grew 0.8%, in line with estimates and the prior month.
Eurostat said the largest contributor to upward pressure came from restaurants and cafes and rents and tobacco, while transport and energy weighed the most on inflation.
EUR/USD Following Through on Monday’s Gain
EUR/USD is following through to the upside on the heels of Monday’s gain, with the pair currently trading at 1.1018, up 0.19%. With today’s follow through, the pair is now up about half a percentage point over Friday’s close. Weakness in the dollar is helping boost EUR/USD, as the basket of currencies is pulling back after recently establishing a seven-month high.
The advance in EUR/USD is helping ease an extreme oversold condition that developed on both a daily and weekly basis as a result of the steep losses that have been posted in the month of October. The rally appears largely in response to the oversold condition, as Monday’s release of September Eurozone CPI was in line with expectations. According to Eurostat, the Consumer Price Index for the month of September increased 0.4%, up from a 0.2% rise in August. On an annualized basis CPI was 0.4%, unchanged from August. With the Stochastic, a price momentum indicator still at a relatively depressed level on a daily basis, the rebound has the potential to extend over the short term.
However, volatility has the potential to become a factor later today, as the U.S. is set to release September CPI data at 8:30am EST. Consensus estimate for Sept. CPI is 0.3%, while the Core CPI consensus forecast is at 0.2%. This will be a key metric in the Federal Reserve’s decision to raise rates before the end of the year, a factor that will have bearing on the dollar. As of Monday’s close, Fed Fund futures were indicating a 69.5% chance of a rate increase at the December meeting.
The key event this week for EUR/USD, however, is Thursday’s European Central Bank Governing Council Meeting. Bank President Draghi will hold his regular press conference 45 minutes after the interest rate decision, which is due out at 7:45am EST. This is a particularly important meeting for the ECB, as there is only one additional meeting prior to the end of 2016. While rates are expected to remain unchanged, there will be an important focus on the bond-purchase program, which is currently due to come to an end in March 2017. Positive comments could help establish a short term bottom in the pair.
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Morgan Stanley says 200K jobs at risk in Australia, expect more RBA rate cuts
October 2016 German Markit manufacturing PMI flash 55.1 vs 54.4 exp
Details form the October 2016 German Markit manufacturing, services and composite PMI flash data report 24 October 2016