Market liquidity was relatively thin as most U.S. session traders headed out to vote. The pound staged a bit of recovery in hopes that a Brexit deal was in order, even as Downing Street later on dismissed these rumors.
- Canadian building permits up 0.4% vs. 0.3% forecast
- U.S. JOLTS job openings down from 7.29M to 7.01M vs. 7.09M estimate
- BBC report: PM May to present Brexit deal by Nov. 19
- U.K. PM May’s office dismissed BBC report
- New Zealand GDT auction yielded 2.0% drop in dairy prices
- New Zealand quarterly jobs data coming up
More Brexit-related updates
Following through on the earlier round of updates in the previous trading session, Brexit headlines got a little bit more entertaining when the BBC reported that U.K. officials might be ready to pitch their plans by November 19.
Citing a document called “Brexit Communications Grid Summary,” the report referred to a timetable in which the U.K. government could present their Brexit transition deal ideas to Parliament. According to the said document, Raab will announce “a moment of decisive progress” by Thursday then PM May will present the deal in the CBI conference later on.
From there, PM May will convene business leaders then later on visit Scotland while the Commons will iron out the details for the “Meaningful Vote” among lawmakers. The document concludes by stating that this vote will be held on November 27, urging:
HISTORIC MOMENT, PUT YOUR OWN INTERESTS ASIDE, PUT THE COUNTRY’S INTERESTS FIRST AND BACK THIS DEAL.
However, No. 10’s office dismissed this rumor, with a spokesperson stating:
“The misspelling and childish language in this document should be enough to make clear it doesn’t represent the government’s thinking. You would expect the government to have plans for all situations — to be clear, this isn’t one of them.”
A bit of risk-taking
Liquidity was thinner than usual as investors were busy casting their votes in the U.S. midterm elections. Note that this is considered a gauge of confidence in the current administration, as a Democrat-led Congress or a divided one could signal that Trump might not seek reelection.
But even with a lot at stake on the polls, U.S. equity indices managed to chalk up some gains:
- Dow 30 index is up 94.78 points to 25,556.48 (+0.37%)
- Nasdaq is up 26.24 points to 7,353.57 (+0.22%)
- S&P 500 index is up 7.37 points to 2,746.18 (+0.28%)
The bulk of the election results are expected to be in by around 1:00 am GMT, although the numbers will be trickling in over the next few hours and should provide strong clues on the turnout.
Crude oil wasn’t able to cash in on risk-on flows as the commodity slumped more than 2% on Iran sanctions waivers. Earlier this week, U.S. sanctions on the country were imposed but exemptions to a number of its trade partners were given, easing worries about restrictions on global oil supply.
Major Market Mover(s):
After a lot of tossing and turning earlier on, sterling finally found its legs and picked up on rumors that a Brexit deal presentation timeline is in order. A few of those gains were returned when PM May’s office dismissed the BBC report as bollocks but the U.K. currency stayed afloat.
GBP/JPY is up 90 pips to 148.49 (+0.61%); GBP/CAD advanced 97 pips to 1.7192 (+0.57%); GBP/USD bounced to 1.3093 (+0.41%), and EUR/GBP dipped 29 pips to .8717 (-0.33%)
USD & JPY
The scrilla was on shaky footing for the most part of the session, but its safe-haven rival, the Japanese yen, wasn’t doing so well either.EUR/USD is up to 1.1415 (+0.07%); AUD/USD is up to .7220 (+0.15%); NZD/USD is up 24 pips to .6667 (+0.36%); and USD/CHF is down 15 pips to 1.0030 (-0.15%).
USD/JPY is up 24 pips to 113.42 (+0.21%); NZD/JPY is up to 75.61 (+0.40%); CHF/JPY is up to 113.08 (+0.35%); EUR/JPY rose 37 pips to 129.47, and CAD/JPY ticked up to 86.36 (+0.05%).
Watch Out For:
- 1:00 am GMT: Japanese average cash earnings y/y (gain from 0.8% to 1.2% expected)
- 3:00 am GMT: New Zealand inflation expectations q/q (previous reading at 2.0%)
- 6:00 am GMT: Japan’s leading indicators (dip from 104.5% to 103.9% eyed)