US earnings resilience

Global market sentiment was seen picking up a notch overnight with Wall Street gaining on earnings despite the uncertainty that persists on US-China trade.

Against fears for the worse, the Q3 earnings season in the US saw a good opening with major lenders reporting their performance. JP Morgan notably had been one to reflect the resilience in the consumer sector, going on to reassure the market concerned with the economic slowdown. Record revenue that came in above the Street’s expectation likewise had been the case for Citigroup, assisting in the climb for the financial sector. Looking at the sector ETF, the XLF ETF, prices had evidently made its way to the earlier resistance at around $28.17, eyeing the earlier high. The likes of Netflix and IBM will be key ones to watch going into the session ahead for potential volatility to their share prices. As far as the comprehensive S&P 500 index or the Dow is concerned, prices largely exhibit similar trend awaiting further direction from both earnings and US-China trade this week.

Source: IG Charts

On FX, while the improvement in sentiment from the abovementioned earnings boost had seen to USD/JPY touching a fresh 3.5-month high at $108.89, gaining the focus among major currencies had been the British pound. The greenback had continued to lose ground against the British pound overnight. A week focused on politics as well had seen this issue getting positive sentiment with the latest claim that a deal is close amid meetings between the UK and EU driving up the cable. Prices touched a fresh high since late May, testing the resistance at $1.2751. The potential lack of support from the UK parliament for any deal continues to represent the risks ahead which the sterling is expected to remain sensitive towards.

Source: IG Charts

Asia open

With the US earnings optimism on hand, Asia markets can be seen broadly trading higher in the early hours. Breaking news of China threatening to retaliate if US passes the Hong Kong bill and the IMF’s latest downgrading of the global growth forecast appear to be doing little to the trading action so far this morning, but remains items highlighting the uncertainty in outlook. Notably, this morning saw Bank of Korea cutting interest rates by 25 basis point as expected. South Korea remains amongst Asia economies the most affected by the on-going trade dispute and concerned with regards to the growth trajectory, not a surprise here seeing this follow after their last move in July.

For the day ahead, look to the series of UK and eurozone data including inflation while more US earnings, retail sales data and beige book will also be in the lot.

Friday: S&P 500 +1.00%; DJIA +0.89%; DAX +1.15%; FTSE -0.03%


This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Take a position on indices

Deal on the world’s major stock indices today.

  • Trade the lowest Wall Street spreads on the market
  • 1-point spread on the FTSE 100 and Germany 30
  • The only provider to offer 24-hour pricing

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
Bid
Offer
Updated
Change
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Bid
Offer
Updated
Change
-
-
-
-
-
-
-
-
-
-
-
-
Bid
Offer
Updated
Change
-
-
-
-
China 300
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-

Prices above are subject to our website terms and agreements. Prices are indicative only

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Monday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% 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. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.