FXStreet (Guatemala) – Analysts at Brown Brothers Harriman noted the key events that have taken place today.
Key Quotes:
“China cut rates, Despite a mixed session in Asia, markets woke up in reversal mode in Europe even before the rate cut. Hamada, an advisor to Japan PM Abe, fuelled calls for authorities to take more action. German August IFO came in on the strong side. South Africa’s Q2 GDP came well below expectations .”
Price action: The dollar is mixed on the day. The euro has gradually trended lower after its high of $1.1714 yesterday to trade below $1.1500 now. Sterling is outperforming, trading just around the $1.58 level. The dollar bounced back to nearly ¥120.0 currently, compared with yesterday’s flash drop to a low of ¥116.18. Many EM currencies are up sharply against the dollar. This is being led by the oil exporters RUB and MYR but SGD, INR and most other Asian currencies are also up, with the exception of IDR. CNY was down 0.14% to a USD/CNY rate of 6.4128.”
Nikkei ended down 4.0%, after moving in a range of more than 1000 points, which makes its volatility reached the highest since more than 2 years. The Shanghai comp suffered a loss of 7.6%.
However, most other EM Asian indices are up, as are majors. For example, Taiwan’s Taiex was 4.6% higher and Turkey’s BIST is up 2.1%. EuroStoxx is up 3.3% led by Greece and Germany. Energy prices are also coming along for the ride. WTI futures up 3.2% overnight to $39.50. Sovereign debt yields for most core markets are up 2-5 bp, recovering from some of yesterday’s declines.”
(Market News Provided by FXstreet)