What mattered last week:
- The S&P500 fell for the third straight week after soft economic data in China and Germany triggered fresh signals from the U.S. bond market that a recession is becoming more likely.
- Specifically, the yield on the 10-year Treasury rate fell below the 2-year rate for the first time since 2007, joining the 3 month – 10-year spread in inversion territory.
- While an inverted yield curve does not guarantee recession, it has been reasonably accurate in the past and a reflection of the current state of uncertainty caused by the trade war.
- Attempting to counter economic weakness, the National Development and Reform Commission in China announced it intends to roll out a plan (no details yet) to boost China’s disposable income and spur consumption.
- In Europe, an interview with ECB policymaker Olli Rehn has created expectations that a “significant and impactful” stimulus package will be unveiled at the ECB’s meeting in September.
- In Australia, a stronger than expected jobs report could not prevent the ASX200 from falling -2.72% for the week to close at 6405.5.
- As disappointing earnings results from companies including Blackmores, Telstra and Woodside added to the prevailing offshore gloom.
- In FX, the AUDUSD closed the week unchanged as the better Australian jobs report helped to counter a generally stronger U.S dollar.
For the week ahead, the key events are:
Australia: RBA meeting minutes (Tuesday).
The earnings season continues this week with reports from 115 companies including BlueScope BHP, Brambles, Amcor, Qantas, Origin and South 32.
New Zealand: NZ Services PSI (Monday), Global Dairy Auction (Wednesday), retail sales (Friday).
China: Nothing of note.
Japan: Reuters Tankan index, balance of trade (Monday), flash PMI (Thursday), inflation (Friday).
U.S.: Existing home sales, FOMC meeting minutes, Markit flash PMI (Thursday), Jackson Hole Symposium.
- Jackson Hole Symposium: The subject of this year’s annual central bankers’ Jackson Hole Symposium (22-24 August) is “Challenges for Monetary Policy”, which is likely to include a robust discussion on the threats to growth from the trade war and how best to respond.
Canada: Inflation (Wednesday), retail sales (Friday).
Euro Area: German PPI (Tuesday), German and EA Markit flash PMI (Thursday),
UK: Nothing of note.
About TECHFX TRADERS
The session will be run by Tony Sycamore founder of TECHFX TRADERS. Tony has over 20 years’ experience trading primarily at Goldman Sachs and he also worked in senior Institutional roles at Commonwealth Bank and BNP Paribas. His experience has allowed him to see and work with some of the biggest global traders.
Finalist – Best Bank FX Research & Strategy
Tony was the only Australian finalist nominated for Best Bank FX Research & Strategy at the 2016 Technical Analyst awards.
Finalists: Commonwealth Bank of Australia – Tony Sycamore, Director Institutional FX • Banque Pictet & Cie • Credit Suisse RBC Capital Markets • Royal Bank of Scotland • Scotia Bank
TECH-FX TRADING PTY LTD (ACN 617 797 645) is an Authorised Representative (001255203) of JB Alpha Ltd (ABN 76 131 376 415) which holds an Australian Financial Services Licence (AFSL no. 327075)
Trading foreign exchange, futures and CFDs on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange, futures or CFDs you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss in excess of your deposited funds and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange, futures and CFD trading, and seek advice from an independent financial advisor if you have any doubts. It is important to note that past performance is not a reliable indicator of future performance.
Any advice provided is general advice only. It is important to note that:
- The advice has been prepared without taking into account the client’s objectives, financial situation or needs.
- The client should therefore consider the appropriateness of the advice, in light of their own objectives, financial situation or needs, before following the advice.
- If the advice relates to the acquisition or possible acquisition of a particular financial product, the client should obtain a copy of, and consider, the PDS for that product before making any decision.
From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.
As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.
Open a live account in minutes
Latest Analysis and Insights
- The Week Ahead: G7 and Jackson Hole wind down, US GDP and German IFO August 24, 2019 4:53 PM
- So Much for the Summer Doldrums August 24, 2019 6:24 AM
- Market Brief: Powell a Dud, Traders Terrified of Trade Tensions August 24, 2019 6:09 AM
- Trump Steals Powell's Thunder after Jackson Hole August 24, 2019 2:12 AM
- Oil pares some China inspired losses post Powell August 24, 2019 12:53 AM