Morning Jumpstart Macro View 29/09/21

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  • SPI200 (Dec) overnight futures down 82 pts to 7157
  • SP500 down 90.48 pts to 4352.63
  • NASDAQ Composite down 423.29 pts to 14546.68
  • Dow Jones down 569.38 pts to 34299.99
  • FTSE100 down 35.30 pts to 7028.10
  • DAX30 down 325.32 pts to 15248.56
  • GOLD futures US session (Dec) down $18.10 to $1733.90 an ounce
  • COPPER futures US session (Comex Dec) down $0.0425 to $4.2470 a pound
  • OIL futures US Session (Nymex Nov) down $0.16 to $75.29 a barrel
  • CRB Index up 0.35 pts to 228.59
  • AUDUSD trading at 0.7240
  • EURUSD trading at 1.1682
  • GBPUSD trading at 1.3534
  • USDJPY trading at 111.5100
  • USD Index US Session (ICE Dec) up 0.362 to 93.743

US indexes took a beating to follow in the footsteps of the European market. Bond yields continued to rally triggering a tantrum into tech shares as sellers weighed on the action right from the open on expectations for a higher cost of money in the future which will in turn weigh on growth. The move into bonds shows that it is related to tapering rather than any concern into contagion from Evergrande as bonds lacked any safe haven buying. Data showed that the mighty US consumer is concerned with the economic slowdown and inflation as Consumer Sentiment came in weaker than expected. Like in the ASX yesterday (which seems to the leading the action), Energy was the only sector ending in green on expectations for rising demand. The DOW closed down 1.63% while the broader SP500 ended down 2.04% and the Nasdaq closed down 2.83% for the session. In Europe, major Indexes moved lower as tech shares pressured the DAX and FTSE from the open. The DAX was hit hard ending down over 2% as bond yields surged and signs of a China slowdown weighed heavily on sentiment.

Inflation is proving to be less transitory than previous expected and is in turn putting pressure on bond prices and higher yields. Supply chain bottlenecks and supply demand imbalances continue to pressure inflation with traders now being at a crossroads with regards to markets….will it be just another BTFD scenario or the start of a bigger correction. Fed Chairs globally are out in force tonight and will be trying to calm markets (speaking times noted below).

The USD Index lifted up and off the 93.400 zone to clear it easily and move up into previous highs at 93.720. Expecting to see the strength continue as the selloff into US Bonds gets a head of steam. The next stop on the USD to the upside is around 94.710 but we may see some heat come out of the action first or at least consolidation around current levels. The EURUSD continued the push lower although found some good buying to provide support above the 1.1665 level. The 1.1600 level just below is key for bulls and will need to hold if buyers are to see higher prices in the near term. For now buyers are putting up a fight but it will be in vein if the USD continues to rally. The GBPUSD took a hit right from the open of European markets and price kept moving lower through major support at 1.3600 to hold lows into the US close. The move maybe showing the concern for a higher USD and lower US bonds. For now, expecting to see a squeeze on shorts from overnight before watching for a potential lower high….which will depend on USD at current levels. The AUDUSD also nosedived into the European open as shares fell over. Price pushed into previous lows and support around 0.7225 which will be watched closely by traders today for either a flush and bounce or continuation lower. The USDJPY was again in a bullish mood as price pushed up into resistance at 111.600. Price action is extended so expecting to see some profit taking from recent buyers although this will depend on the USD…price can always extend further than expected.

SPOT GOLD continues to disappoint inflation bulls and is pressured lower again. Price cleared the 1750 support area and is looking down to 1721 support. For now, there is no safe haven or inflationary buying to support and price is linked purely to the USD moves with daily support right down around 1680. Crude Oil reacted lower off a daily resistance zone around 75.50/77.00. The move lower may just be some heat coming out of the recent rally; if the energy sector is anything to go by; so watching to see if buyers come back into to support price above 73.00. Copper stood its ground pretty well considering which suggests that traders are looking to increasing demand to support price. Watching to see if buyers can hold price above the 4.2000 zone.

Cryptocurrencies drifted lower along with the selling into share market indexes. Majr crypto pairs moved back down into previous lows to hold the recent short term trend down. Bitcoin is currently trading at $41849.00 down 2.84% while Ethereum is at $2880.007 down 3.86% and Ripple is at $0.91784 down 2.06%.

The ASX200 took a steady beating from the open yesterday as buyers were scarce and nervous for flow over from Chinas woes. The index ended the day down 108.6 points to 7275.6 with shares in Gold, IT and Metals and Mining leading the market lower while Energy was the only sector with notable buying. Asian markets were mixed with the Hang Seng higher and Nikkei down slightly.

The ASX200 is expected to open down 80 points after the SPI200 took another big hit in overnight trade.


EUR German Import Prices 4pm

GBP Mortgage Approvals 6:30pm

USD Pending Home Sales 12am

USD Crude Oil Inventories 12:30am

EUR ECB President Lagarde Speaks 1:45am

GBP BOE Gov Bailey Speaks 1:45am

USD Fed Chair Powell Speaks 1:45am

JPY BOJ Gov Kuroda Speaks 1:45am


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