Overseas Market Outlook
Today's overseas market lacks significant events that could provide direction. The main economic releases include the US MBA Mortgage Applications Index (for the week of 07/27 - 08/02) and the Canadian Ivey Purchasing Managers Index (July). However, no major US economic indicators are scheduled for release. Key events include Boston Fed President Collins' participation in an event, the release of the Bank of Canada meeting minutes (from July 24), and the US Weekly Petroleum Status Report. Corporate earnings from Walt Disney and Lyft are expected to draw attention. Overall, it appears to be a relatively uneventful day for the overseas markets.
Tokyo Market Movements
The Tokyo market experienced volatile trading today. An initial drop in the Nikkei 225 by nearly 1000 points reversed to a gain of 1000 points following comments from Bank of Japan Deputy Governor Uchida, stating that there would be no interest rate hikes under unstable financial market conditions. The USD/JPY pair surged from the mid-144 range to as high as 147.90. While the afternoon saw a pause in the stock rally and yen depreciation, the Nikkei 225 closed up 414 points, and the USD/JPY stabilized in the high 146 range.
Key Points to Watch
Investors will closely monitor whether overseas players react to Deputy Governor Uchida's comments. Initially, the focus will be on the London market's response, followed by the sensitivity of markets to movements in US and European stocks. The 1-week USD/JPY volatility currently stands around 19.5%, showing signs of stabilization from a recent spike but remaining at elevated levels. Market fluctuations of around 50 pips can be expected even in the absence of significant events, indicating ongoing instability.
Washington Post Report
According to the Washington Post (online edition), US government officials have indicated that Iran may be reconsidering plans for a large-scale retaliatory attack on Israel. This ongoing risk aversion is keeping the markets on edge, though Iran's actual intentions remain unclear. Given the potential for sudden market shifts based on Middle East developments, vigilance is advised.
