Here is what you need to know on Monday, October 4:
Markets have kicked off the week on the back foot after Friday's rally, while the dollar remains stable. New worries about Evergrande, uncertainty about US infrastructure, and covid headlines are in the limelight.
Congress: Voting on the bipartisan infrastructure bill was suspended amid a lack of support from the left-wing of the Democratic Party. Progressives want guarantees that the larger $3.5 trillion bills would receive backing from centrists. Uncertainty is weighing on sentiment.
Evergrande: The Chinese construction behemoth is in the spotlight again after trading was suspended in shares. The fate of a $260 million debt payment is in the air, yet reports of sales of some of its assets and an orderly restructuring provide hope. Chinese markets are closed for a holiday and resume activity only on Friday.
Concerns that global growth would be delayed due to inflation and supply-chain issues continue weighing on sentiment.
More Cost-push Inflation: Just-in-time production meets its match
Coronavirus: One of the reasons for Friday's rally was Merck's announcement of developing an antiviral cure to the disease. Merck's pills still require regulatory approval. Vaccines have pushed global cases lower, yet the Delta variant is still wreaking havoc, contributing to supply-chain disruptions.
EUR/USD has stabilized around 1.16 ahead of the release of Sentix Investors Confidence. GBP/USD is clinging to its recovery from Friday when it surged to 1.3550. Britain continues grappling with ongoing petrol shortages. USD/JPY is trading around 111 as Fumio Kishida becomes Japan's Prime Minister.
OPEC+ members are meeting to discuss oil output cuts amid higher fuel prices, especially those of natural gas. No substantial changes are expected. WTI Crude Oil is trading around $75, close to the highs.
Nonfarm Payrolls stand out as the main event of the week and could seal the deal on the Federal Reserve's expected tapering announcement. Fed Chair Jerome Powell's signal of such a reduction in bond-buys is the main reason for the dollar's rally early last week. Fed officials James Bullard and Kenneth Montgomery are set to speak later in the day.
Cryptocurrencies: Bitcoin is holding onto gains recorded on Friday when it shot from $44,000 to $48,000. Speculation about regulation is in play. Ethereum is changing hands near $3,330, above last week's levels, and Ada is around $2.20.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD retreats from daily highs, holds above 1.0800
EUR/USD loses traction but holds above 1.0800 after touching its highest level in three weeks above 1.0840. Nonfarm Payrolls in the US rose more than expected in June but downward revisions to May and April don't allow the USD to gather strength.
GBP/USD struggles to hold above 1.2800 after US jobs data
GBP/USD spiked above 1.2800 with the immediate reaction to the mixed US jobs report but retreated below this level. Nonfarm Payrolls in the US rose 206,000 in June. The Unemployment Rate ticked up to 4.1% and annual wage inflation declined to 3.9%.
Gold approaches $2,380 on robust NFP data
Gold intensifies the bullish stance for the day, rising to the vicinity of the $2,380 region following the publication of the US labour market report for the month of June. The benchmark 10-year US Treasury bond yield stays deep in the red near 4.3%, helping XAU/USD push higher.
Crypto Today: Bitcoin, Ethereum and Ripple lose key support levels, extend declines on Friday
Crypto market lost nearly 6% in market capitalization, down to $2.121 trillion. Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) erased recent gains from 2024.
French Elections Preview: Euro to “sell the fact” on a hung parliament scenario Premium
Investors expect Frances's second round of parliamentary elections to end with a hung parliament. Keeping extremists out of power is priced in and could result in profit-taking on Euro gains.