Open account
☰
Open account
✖

European Open Sentiment Improves with Biden Xi Jinping Call

Article By: ,  Market Analyst
September 10, 2021 1:47 AM

Asian Indices:

  • Australia's ASX 200 index rose by 40 points (0.54%) and currently trades at 7,409.50
  • Japan's Nikkei 225 index has risen by 336.17 points (1.12%) and currently trades at 30,344.36
  • Hong Kong's Hang Seng index has risen by 423.24 points (1.65%) and currently trades at 26,139.24

UK and Europe:

  • UK's FTSE 100 futures are currently up 8.5 points (0.12%), the cash market is currently estimated to open at 7,032.71
  • Euro STOXX 50 futures are currently up 5.5 points (0.13%), the cash market is currently estimated to open at 4,182.61
  • Germany's DAX futures are currently up 8 points (0.05%), the cash market is currently estimated to open at 15,631.15

US Futures:

  • DJI futures are currently down -151.69 points (-0.43%)
  • S&P 500 futures are currently up 24 points (0.15%)
  • Nasdaq 100 futures are currently up 8.25 points (0.18%)


Learn how to trade indices


Indices rise to the occasion (but no cake)

Asian equities were higher overnight, helped in part by positive earnings and on reports that Joe Biden had a phone call with Xi Jinping, which suggests US-Sino tensions were abating. Over the 90-minute call, the two powers had a “broad, strategic discussion” including how to avoid competition veering into conflict. Nice. So, we’re not quite at the ‘the most beautiful piece of chocolate cake’ stage of the relationship, but it is a step in the right direction.

The Hang Seng was a top performer, rising around 2% and the China A50 index rose 1.4%. Japan’s share markets extended their rallies to see the TOPIX hit its highest level since 1990 and the Nikkei tough a fresh 6-month high. The ASX 200 recovered from yesterday’s lows yet found resistance just under the resistance zone around 7430-50 highlighted in today’s Asian Open report.

Bears wasted no time in driving the FTSE 100 down to our 7,000 target yesterday, with the first hour of trade accounting for most of the daily range. In isolation, the bearish flag on the hourly chart looks quite appealing for bearish eyes. Yet in context of improved global sentiment for equities, and the fact that 7,000 is a psychological round number near the weekly S3 pivot, it’s plausible to expect a countertrend bounce today. 7060 and 7090 make viable bullish targets. Further out, a break beneath 6993 could mark its next leg lower.


FTSE 350: Market Internals


FTSE 350: 4068.81 (-1.01%) 09 September 2021

  • 129 (36.75%) stocks advanced and 211 (60.11%) declined
  • 5 stocks rose to a new 52-week high, 10 fell to new lows
  • 71.23% of stocks closed above their 200-day average
  • 64.67% of stocks closed above their 50-day average
  • 17.38% of stocks closed above their 20-day average

Outperformers:

  • + 5.58%   -  IP Group PLC  (IPO.L) 
  • + 3.94%   -  Grainger PLC  (GRI.L) 
  • + 2.56%   -  Helios Towers PLC  (HTWS.L) 

Underperformers:

  • -10.2%   -  Easyjet PLC  (EZJ.L) 
  • -7.63%   -  Genus PLC  (GNS.L) 
  • -4.80%   -  Cineworld Group PLC  (CINE.L) 


Forex: UK GDP, CA employment and US PPI on tap

Commodity currencies were the leaders overnight, with AUD rising 0.3%, NZD up 0.23% and CAD 0.16% for the session. The yen and USD were the weakest currencies during the mildly risk-off session.

NZD/JPY is the strongest pair and is showing the potential bull flag on the daily chart. We just need the markets to get ahead of themselves with the Biden-Jinping phone call and nothing else to go wrong.

UK GDP is then released at 16:00. Whilst the economy has been picking up it remains behind where is was prior to the pandemic. Yet hawkish comments from BOE Governor Bailey have teased expectations of a rate hike, so a strong print today could serve bullish setups well for GBP pairs.

Later in the US session, Canadian employment is released and, for one, won’t be overshadowed by NFP. As we think BOC may still be close to tapering (despite the setback in Q2 GDP), a strong employment report could have the Canadian dollar regain some strength ahead of the weekend.

At the same time of 13:30 BST, US producer prices are released. And a strong print could be of interest for USD bulls as it can be seen as a proxy for next week’s CPI data.


Learn how to trade forex


Commodities show the potential to perk up:

Copper futures broke above daily trend resistance on news of the Biden-Xi Jinping phone call. The next target remains to be 4.435 as long as prices remain above 4.20 and its possible that an inverted head and shoulders pattern is forming on the daily chart.

The CRB commodity basked is trading just below its 4-year high, with a break above 221.25 confirming trend resumption whilst a break below 216.85 assumes a countertrend move.


Up Next (Times in BST)

You can view all the scheduled events for today using our economic calendar, and keep up to date with the latest market news and analysis here.


How to trade with City Index

Follow these easy steps to start trading with City Index today:

  1. Open a City Index account, or log-in if you’re already a customer.
  2. Search for the market you want to trade in our award-winning platform.
  3. Choose your position and size, and your stop and limit levels.
  4. Place the trade.


This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.cityindex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.

ALL TRADING INVOLVES RISKS. LOSSES CAN EXCEED DEPOSITS.

City Index is a trading name of StoneX Financial Pte. Ltd. (“SFP”) for the offering of dealing services in Contracts for Differences (“CFD”). SFP holds a Capital Markets Services Licence issued by the Monetary Authority of Singapore for Dealing in Exchange-Traded Derivatives Contracts, Over-the-Counter Derivatives Contracts, and Spot Foreign Exchange Contracts for the Purposes of Leveraged Foreign Exchange Trading. SFP is also both Derivatives Trading and Clearing member of the Singapore Exchange (“SGX”). SFP is a wholly-owned subsidiary of StoneX Group Inc.

The information provided herein is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to invest, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk.

The information does not represent an offer of, or solicitation for, a transaction in any investment product. Any views and opinions expressed may be changed without an update. To understand the risks and costs involved, please visit the section captioned “Important Information” and the “Risk Disclosure Statement”.

The information herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

StoneX Financial Pte. Ltd. 1 Raffles Place, #18-61, One Raffles Place Tower 2, Singapore 048616. Tel: 6309 1000. Co. Reg. No.: 201130598R.

This advertisement has not been reviewed by the Monetary Authority of Singapore.

© City Index 2024