Compass Global Markets' Blog

Tony's Market Blog - 23 May 2017

Posted by Tony Boyadjian on May 23, 2017 at 12:02 PM

 USD is weaker, EUR & GBP are stronger & AUD firms above 74 US cents.

2 suspected suicide bombs have exploded at a pop concert in the North London city of Manchester. Tragically, there are reports of multiple fatalities & injuries.

Recent US economic data  have been disappointing - GDP, CPI, core inflation, retail sales, housing activity & construction numbers have been soft. 

USD sell-off is a result of the alleged scandals against the Trump administration, raising suspicion of "obstruction of justice" by President Trump & concerns that pro-US economic growth policies (tax reform & increased fiscal spending) may be derailed.  

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Topics: Report, Market

Market Update - 23rd May 2017 - Aussie Up Marginally On Higher Commodity Prices

Posted by Patrick Downes on May 23, 2017 at 8:36 AM

The Aussie dollar is marginally higher again this morning thanks to another positive session in commodities prices which saw iron ore, copper and oil all higher. U.S stock markets also pushed higher with the NASDAQ up around 0.8% but the gains ended their as European stocks stumbled following the latest Eurogroup meetings. The meetings held all night failed to find consensus on a range of issues ranging from how to manage euro debt and also how to deal with the likes of Greece which remains a basket case of an economy after many years of austerity.

Ahead this evening is German IFO Business climate data followed by Inflation Report Hearings out of the U.K.

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Topics: Report, Market

Market Update - 22nd May 2017 - Commodity Prices Roar Back To Life Supporting AUD

Posted by Patrick Downes on May 22, 2017 at 9:06 AM

Commodity prices bounced back Friday and into the close of trading Saturday morning, helping to support the Aussie dollar. The best performers were the base metals with iron ore up a whopping 3.5%, while Nickel was up 3% and copper 2%. Energy prices on the whole and the precious metals also finished ahead.

The Aussie dollar (not surprisingly after such a strong boost to commodities prices) also performed quite well with AUD/USD managing to push back above 0.7400 on the wholesale market.

We have no tier 1 economic data released today, however Eurogroup meetings are held in Brussels this evening. Eurogroup meetings are held monthly and usually see a group of European finance head honchos chin wagging about the Euro area. However pending any major reforms, this meeting is unlikely to have any effect on AUD/EUR or AUD/GBP.

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Topics: Report, Market

Market Update - 19th May 2017 - Markets Settle While Local Employment Numbers Provide Mixed Signals

Posted by Patrick Downes on May 19, 2017 at 9:01 AM

Morning all, I'll be out of the office this afternoon as I have a good friend's wedding however thanks to the wonders of our cloud based payments platform I'm still able to book all trades as requested, simply email me with your trade requests and I'll forward confirmations as per usual.

The Aussie dollar has caught up to the losses across equity markets two night's ago eventually falling around 20-30 points depending on which currency pair you're watching. Additionally jobs numbers released yesterday created some confusion with the official unemployment rate dropping to 5.7% as 37K new jobs were created. But diving a little deeper into the numbers we see that the vast majority of these new jobs created were part-time with of course far lower hours than a full time job. This is typically perceived poorly by markets and has become somewhat of a trend in recent months.

Very little economic data is out today and markets look like they have settled down since Wednesday evening so expect perhaps more of the same throughout today and tonight. Have a good weekend.

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Topics: Report, Market

Market Update - 18th May 2017 - Markets Hammered As The Trump Trade Unravels, Fast...

Posted by Patrick Downes on May 18, 2017 at 8:34 AM

Equity markets got pummelled overnight thanks mostly to the workings of Drumpf and his Republican party compatriots who for all intents and purposes look like they want to be good captains and go down with the ship. U.S equities were hardest hit with the tech heavy NASDAQ index belted lower to the tune of over 2.5%, while in Europe stock markets fell around 1.5% across the board. Our local market is looking set to open lower by a factor of 1% but this could worsen as the day goes on. Commodities markets managed to avoid the carnage seen on equities which supported our local currency. AUD/USD, which has been lower this month is now trading tentatively around the 0.7400 figure.

With local employment data due out at 11.30am expect further volatility and of course downside risk should we see poorer than expected numbers here. The market has tipped no change to the unemployment rate, but expect very little in way of new jobs created. Later this evening is further risk for AUD/GBP with UK retail sales figures due at 6.30pm.

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Topics: Report, Market

Market Update - 16th May 2017 - AUD/GBP In The Spot Light Ahead of UK Inflation Figures

Posted by Patrick Downes on May 16, 2017 at 8:39 AM

Very little economic data released overnight and yesterday means the Aussie dollar is little changed from this time yesterday, however we did see the latest economic numbers out of China and while the numbers failed to meet expectations of 7.00%, industrial production still managed to post a respectable 6.5% growth which is about on trend for the past two years. Whether we ever get back to the heady days of 10-20% growth in industrial production remains to be seen but you just never know. The future is after all quite unpredictable.

U.S equities and stocks all managed to make gains overnight with iron ore up around 1.5%, while U.S stocks managed to push higher by a factor of half a percent or thereabouts. Ahead today is the minutes from the latest RBA meeting held earlier in the month, while we'll also see UK CPI numbers around 6.30pm AEST. UK inflation numbers will be watched closely by traders and should be watched closely also by those with GBP exposures, for the simple reason that AUD/GBP has fallen over 500 points since late March; further strong CPI numbers out of the UK could suggest further falls ahead for AUD/GBP. Call me if you'd like to discuss further.

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Topics: Report, Market

Market Update - 15th May 2017 - Aussie Consolidating Below 0.74 US Cents, Chinese Data Out Today

Posted by Patrick Downes on May 15, 2017 at 8:32 AM

The Aussie dollar appears to have now consolidated below 0.7400 US cents suggesting support for the local currency may be waning amid continued poor economic data, slow retail sales and lagging commodity prices. Commodity prices which had been soaring over the past 12 months came to a screeching halt in February and have failed to win back the momentum that took iron ore from around US$40 a tonne to US$90 a tonne by Feb.

Chinese industrial production is released around midday today and is forecast to show continued signs of recovery with economists expecting to see a figure of around 7.00% year on year. Last months reading was 7.6% which was the best number since January 2015 and could suggest the China growth story is not yet finished-and of course this benefits the Australian economy and commodities prices.

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Market Update - 12th May 2017 - Aussie Clawing Back Some Lost Ground

Posted by Patrick Downes on May 12, 2017 at 8:31 AM

The local currency has managed to claw back some ground lost over the past week starting today around half a percent higher thanks in part to weaker than expected data coming out of other countries. The Bank of England and Royal Bank of New Zealand both held rates steady and were both less than bullish on their respective economies while the Euro seems to be coming off a fraction following Macron's euphoric and pro-Europe Presidential election win in France.

Ahead this evening is a bout of U.S economic data with both CPI and retail sales numbers due around 10.30pm tonight.

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Topics: Report, Market

Market Update - 10th May 2017 - Poor Retail Sales Figures Drag On AUD, While Federal Budget Promises Infrastructure Spend

Posted by Patrick Downes on May 10, 2017 at 8:37 AM

The local currency has copped another walloping over the past 24 hours, this time as a result of poor retail sales figures which were released yesterday morning. Economists had expected to see some signs of life in retail sales with a forecast figure of 0.3% for last month, however what materialised was -0.1%. And to throw insult to injury the ABS (Australian Bureau of Statistics) then also revised the March reading lower, from 0.4% to -0.2%.

The retail sales figures when considered, suggests that the housing bubble and burden of private debt which stands at over 123% of GDP is causing mortgage strapped Australians to spend less in order to service their ballooning debt payments. This cannot be good for an economy which is barely moving forward while wages growth are mostly stagnant and probably means any further rate hikes are very much shelved, which means a lower Aussie dollar.

We have no local data releases today however economists and traders will be digesting last nights Budget Release and its potential implications on the Australian economy and the Aussie dollar - some initial good signs out of the budget is that us younger folk will be able to salary sacrifice into our super accounts (and get the associated tax benefits) to save for a first home deposit. The other good news is a big infrastructure spend on road and rail.

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Topics: Report, Market

CGM Weekly FX Video Update - 9th May 2017

Posted by Thomas Su on May 9, 2017 at 1:40 PM

 

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