News & Analysis

Earnings knock US Stocks; USD drops; Gold rebounds

Oct 26, 2017 | Daily Market Outlook

Key data and releases coming up:

  22:45 AEDT – EUR Minimum Bid Rate
  23:30 AEDT – EUR ECB Press Conference; USD Unemployment Claims

The Dow had its worst day since September 5th overnight losing 200 points at one stage. Disappointing earnings last night’s driver for loses. Boeing closed 2.8% lower. S&P500 shared the Dow’s pain also posting its worse day since September 5. Chipotle Mexican Grill was the biggest decliner on the index losing 14.6%. The Dow settled 112 points lower; the S&P500 lost 11.98 points; the Nasdaq lost 34.54 points.

Despite Core Durable Goods data betting expectations at 0.7%, the USD took a breather overnight. Risk currencies, excluding the AUD, made gains. The AUDUSD slid though each session after CPI data missed expectations with The Aussie settled 71 pips lower. The Bank of Canada left rates on hold overnight however talk wasn’t very hawkish. This gave the USD its only major gain. The USDCAD added 121 pips to be trading at July 17 highs.

Oil inventories shocked the market coming above expectations at 0.9M, price lost 40 cents overnight. Gold took advantage of the USD reversing loses to closing $2.00 higher, buyers are up and about this morning price trading another $2.20 higher.

European stocks followed Wall St and finished lower. The FTSE lost 79.33 points. The DAX lost 59.78 points. UK prelim GDB beat expectations giving the GBP a solid boost to the USD and CHF. The positive GDP data also lifts a little of the current Brexit doom. Tonight we have the ECB press conference and minimum bid rate. Rates are expected to stay on hold at 0.00%.

This morning, we’ve seen a continuation with the AUDUSD lower and USDJPY lower. ANZ reported a healthy profit however this hasn’t helped the ASX200 as it’s trading 17 points lower. New Zealand reported a worse than expected trade balance this morning with -1143M lower than -900 expected.

GBPUSD Daily – price jumped overnight as prelim GDP showed an unexpected increase, combined with weaker USD, and closed 124 pips higher. Buying has continued this morning with price currently testing 1.3267 level.

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