‘FBI’ moving markets

A stronger dollar was seen at the start of the week while some reversal could be in sight for markets on Monday with a change in tide with respect to the US elections. 

US Trading
Source: Bloomberg

As we have mentioned at the start of last week, the last 7 campaign days or even 72 hours can decide the result of an election. We have certainly seen the FBI’s investigation into a batch of emails concerning Democratic Candidate Hillary Clinton gripping markets at the start of last week. With less than 72 hours to go before the polls close, the FBI had just dished a “no criminal wrongdoing” conclusion, sending some ripples through markets once again.

 

Currencies

The USD index was up by more than 300 pips this morning upon the announcement of FBI director James Comey. Prices was hovering on either side of 97.00 level last week after October’s non-farm payrolls data turned out largely as a non-event. The highly sensitive USD/JPY pair shot up from $101.00 levels, up above $104.00, when last checked. Eye further upward potential towards the $105.00 figure with near-term support at the 100DMA of $102.83.

With the strong dollar coming in, pressure also returns for emerging Asian market currencies. This will be an increased upward push for USD/MYR and USD/IDR pairs, which had already rallied recently on sliding crude oil prices. Notably, concerns over politics have not been limited to the west as we saw protests in both South Korea and Hong Kong over the weekend. Nevertheless, the markets appear to remain unscathed with the KOSPI gapping higher the open, lifted by the news from the US end.

 

Equity

Ahead of the week’s open, we also saw a surge in S&P 500 futures, which jumped by more than 20.0 points, likely to end the downward slide in S&P 500 at the start of the week. The S&P 500 index had declined for 9 consecutive sessions as of last Friday, down 1.94% in the week.

Asian equities meanwhile have already taken the hint with early movers including the Nikkei and KOSPI in black at the open. We are nevertheless two days from the highly anticipated result release for the US elections and the optimism may be a temporary fixture with jitters still lurking in the markets.

 

Commodity

Meanwhile for commodities, one would zoom in to gold to find that prices had dipped approximately 1.0% this morning, trading below the 50DMA of $1297.40. Risk appetite was lifted at the start of the week with the FBI conclusion favouring confidence in Democratic candidate Hillary Clinton, although gold could still be the safe haven of choice with the countdown to the US elections.

 

Friday: S&P 500 -0.17%; DJIA -0.24%; DAX -0.65%; FTSE -1.43%

Denna information har sammanställts av IG, ett handelsnamn för IG Markets Limited. Utöver friskrivningen nedan innehåller materialet på denna sida inte ett fastställande av våra handelspriser, eller ett erbjudande om en transaktion i ett finansiellt instrument. IG accepterar inget ansvar för eventuella åtgärder som görs eller inte görs baserat på detta material eller för de följder detta kan få. Inga garantier ges för riktigheten eller fullständigheten av denna information. Någon person som agerar på informationen gör det således på egen risk. Materialet tar inte hänsyn till specifika placeringsmål, ekonomiska situationer och behov av någon specifik person som får ta del av detta. Det har inte upprättats i enlighet med rättsliga krav som ställs för att främja oberoende investeringsanalyser utan skall betraktas som marknadsföringsmaterial. 

CFD-kontrakt är komplexa instrument som innebär stor risk för snabba förluster på grund av hävstången. 79 % av alla icke-professionella kunder förlorar pengar på CFD-handel hos den här leverantören.
Du bör tänka efter om du förstår hur CFD-kontrakt fungerar och om du har råd med den stora risken för att förlora dina pengar.
CFD-kontrakt är komplexa instrument som innebär stor risk för snabba förluster på grund av hävstången.