Kshitij Consultancy Services Team
Kshitij Consultancy Services
BOE cut rates by 25bps to 5% taking Pound sharply down to 1.2726. It can extend its fall to 1.27/26 before halting. Dollar Index has bounced from 103.80 while Euro can head towards 1.0750/07. US NFP and Unemployment data is crucial to watch today. USDJPY and EURJPY have risen slightly but overall trend remains bearish. USDCNY could trade within 7.2550-7.21/20 with a bearish bias for the near term. USDINR has risen well from 83.64 and continues to look bullish above 83.70. EURINR can dip to 90-89.50 before halting the current fall.
The US Treasury yields have declined further sharply, breaking below their support. While this break sustains, there is room to fall more, and the expected bounce will get negated. The German yields are coming down in line with our expectation. The bearish view is intact. The 10Yr and 5Yr GoI are coming down gradually. The broader view remains bearish. It is not clear whether the yields will get a corrective bounce from here or will fall straightaway.
Weaker than expected US economic data such as Higher Unemployment claims and lower US ISM Manufacturing PMI have led to sharp fall in most of the stocks. Dow Jones and Nikkei have fallen sharply but have got near term support which if holds can produce a bounce back. DAX has fallen towards 18000 and might fall further towards 17800-17700. Nifty can fall back taking cues from the sell-off in the global markets. Shanghai has dipped further and will remain bearish while below the resistance at 2950.
Commodities have fallen back after seeing a decent rise due to the release of weaker than expected US ISM Manufacturing PMI data but all have key immediate support, while above which, a rise back is possible.
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The above views are based on the latest available information. Though the information sources are believed to be reliable, the information is not guaranteed for accuracy. While the views are proffered with the best of intentions, neither the author, nor the firm are liable for any losses that may occur as a result of any action based on the above. World financial markets, and especially the Foreign Exchange markets, are inherently risky and it is assumed that those who trade these markets are fully aware of the risk of real loss involved.
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