CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

Market Brief Markets Brace For Day 2 US China Trade Talk

Article By: ,  Financial Analyst
October 11, 2019 2:30 AM

FX Brief:·         

  • It was a narrow-ranged day for currency markets, although AUD and GBP are the strongest majors, CHF is the weakest. The US dollar index (DXY) remains stuck near yesterday’s low and shows potential to break lower if a partial trade deal can be struck between US and China today (or bounce if no deal is made).
  • AUD/USD touched a 2-week high, EUR/USD is resting in a small range above 1.10, and USD/JPY touched a 6-session high.  
  • The former ambassador to Ukraine is expected to testify later today to the House of Representatives investigators.



Equity Brief:

  • Key Asian stock market have gapped up in today’s Asian session and almost reached their respective 5-day highs on the backdrop of a promising U.S-China trade negotiation talk that has concluded its first day and the second day of talk will proceed as scheduled today.
  • Market participants have now been “guided” towards a potential “partial trade deal that includes a currency pact with China” to be concluded today by a series of U.S President Trump’s tweets that includes a meeting with the highest ranking official from the Chinese delegate, Vice-Premier Liu He at the White House. Thus, the “bar” has been set high on the positive side and any disappointment towards the end of today’s talk or negative outburst from President Trump’s tweets can easily reverse the current gains.
  • Hong Kong’s Hang Seng Index is the best performer so far as it rallied by 2.19% after being labelled as the worst performer since Jul 2019. Even though its stellar performance seen today, the Hang Seng Index is still down by -9.4% from its Jul 2019 high of 29007.
  • The S&P E-Mini futures has continued inch higher by 0.42% in today’s Asian session to print a current intraday high of 2956, just below the 2960 level that has stalled the previous up move seen last week.

Up Next

  • Day 2 of U.S-China trade talk where its conclusion will set the tone for the market in the next few weeks. Things to look out; if there is a currency pact signed, what are the exact terms and how such pact is to be enforced. A partial deal with what kind of strings attached; how long U.S. will delay the next tranche of tariffs on Chinese imports and will China be willing to give up its industrial policy that subsides the SOEs (state owned enterprises), one of the major requirements that U.S demands from China in order to break the impasse for a full trade deal.  
  • Germany CPI for Sep where market is expecting similar growth rate from last month; 0.9% y/y and -0.1% m/m. If inflation numbers disappoint, the EUR/USD may see some downside pressure to retrace yesterday’s gains.  


Matt Simpson and Kelvin Wong both contributed to this article

Data from Refinitiv. Index names may not reflect tradable instruments and not all markets are available in all regions.


StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024