Newsquawk

Euro Market Open: APAC stocks traded higher, DXY is softer, and crude oil futures eked mild gains

25 Aug 2022, 06:42 by Newsquawk Desk

APAC stocks took impetus from the positive handover from Wall St (S&P 500 +0.3%) but with gains capped as attention remained on the looming Jackson Hole Symposium.
European equity futures are indicative of a slightly higher open with the Euro Stoxx 50 future +0.3% after the cash market closed up by 0.4% yesterday.
DXY is softer after the index failed to hold above 109, antipodeans leads G10 FX, EUR/USD hovers around parity.
It was reported that the US rejected all the additional conditions requested by Iran.
Looking ahead, highlights include German GDP (Detailed), Ifo, US GDP (2nd), PCE Prices Prelim, Jackson Hole Symposium, ECB, CBRT & Banxico Minutes, supply from Italy, UK & US.

US stocks notched mild gains led by small caps although advances in the major indices were limited after mixed durable goods data whereby the miss on the headline led to a downgrade of the Atlanta Fed Q3 GDP tracker but the core metrics were more promising, while the focus shifts to Jackson Hole.
SPX +0.30% at 4,141, NDX +0.28% at 12,918, DJIA +0.19% at 32,971, RUT +0.84% at 1,935.
Click here for a detailed summary.

US State Department said planned tribunals in Russia-controlled Mariupol are illegitimate and a mockery of justice, according to Reuters.
US Secretary of State Blinken tweeted that Russia’s missile strike on a train station full of civilians in Ukraine fits a pattern of atrocities, while he added the US will continue with partners to stand with Ukraine and seek accountability for Russian officials.

It was reported that the US rejected all the additional conditions requested by Iran and urged Iran to lift any restrictions on international inspections, while it said that Iran should not be permitted to enrich uranium beyond a purity level of 4%, according to Al Arabiya. However, an Iranian professor cited by WSJ's Norman later said that the claim made by Al-Arabiya is false and that Iran has just started studying the response and will inform the coordinator afterwards.
Europeans are in contact with the parties to the Iran nuclear agreement to hold a new round of talks after receiving the US response, according to Al Arabiya.
US-led international coalition operating in Iraq and Syria reportedly conducted a second round of airstrikes which targeted Iran-linked sites in the Deir al-Zor region of eastern Syria on Wednesday evening, according to Jerusalem Post citing local press.
US Pentagon said it is aware of reports about an exchange of fire in Syria and said the US will not hesitate to defend itself, according to Reuters.

APAC stocks took impetus from the positive handover from Wall St but with gains capped as attention remained on the looming Jackson Hole Symposium.
ASX 200 was led higher by commodity stocks after the recent upside in energy and precious metals.
Nikkei 225 was underpinned as the government mulled a further loosening of COVID rules and is expected to extend local travel incentives through next month.
Shanghai Comp was initially choppy amid the absence of Stock Connect flows after morning trade in Hong Kong was cancelled, although the mood gradually improved with Hong Kong opening for the afternoon session after the storm signal 8 was dropped and following the recent support pledges by China.
US equity futures extended on recent cautious advances as markets await Fed clues; ES +0.5%.
European equity futures are indicative of a slightly higher open with the Euro Stoxx 50 future +0.3% after the cash market closed up by 0.4% yesterday.

DXY continued to soften after its recent failure to hold above the 109.00 level. Note, Morgan Stanley's month-end model signalled USD weakness against G10 FX.
EUR/USD traded marginally higher and retested resistance at parity ahead of the European open.
GBP/USD reclaimed 1.1800 but with gains capped as participants await BoE rhetoric from Governor Bailey in Wyoming.
USD/JPY retreated in tandem with the greenback although JPY crosses were kept afloat by the mildly positive mood overnight and after BoJ board member Nakamura stuck to the dovish script.
Antipodeans were positive after recent gains in commodities and with AUD/USD marginally outperforming its trans-Tasman counterpart following weak New Zealand Retail Sales.

10yr UST futures remained lacklustre amid positioning in anticipation of hawkish comments from Fed Chair Powell at Jackson Hole and with prices not helped by a soft 5yr auction.
Bund futures languished near a monthly low ahead of German IFO data and ECB minutes, with higher energy prices stoking the inflationary narrative.
10yr JGBs futures were subdued on spillover selling from global counterparts and despite the slight improvement in demand at the enhanced liquidity auction for long to superlong JGBs.

Crude eked mild gains as price action quietened from yesterday's volatility amid the overhang from OPEC production cut warnings, large US crude inventory draw, weak gasoline demand, Russian price cap retaliation and reports that the US rejected Iran's nuclear deal requests.
Black Sea CPC blend crude oil exports fell 32% behind schedule so far in August amid Kashagan oilfield maintenance and terminal repairs, according to Reuters sources.
German government reportedly sees problems with coal supply for power plants and oil supply in eastern areas in Autumn and Winter due to low water levels in the river Rhine, according to an Economy Ministry document cited by Reuters.
Norsk Hydro labour dispute between Industri Energi and Norsk Industri has ended and potential delays to customers are expected to be minor.
Spot gold extended on the prior day's highs.
Copper traded sideways amid a softer dollar and cautious gains in stocks.
A strike action that affected Alcoa’s Mosjøen smelter in Norway will end immediately after a solution was reached on the labour dispute, according to Businesswire.

Bitcoin prices were marginally firmer and briefly reclaimed the 21,500 level.

NOTABLE APAC HEADLINES

China Human Resources Ministry official said they will focus on expanding jobs and will promote fiscal, monetary and industrial policies to support job market stabilisation, according to Reuters.
BoK hiked its base rate by 25bps to 2.50%, as expected, with the decision unanimous. BoK said inflation will remain high for the time being and export growth is to slow, while Governor Rhee said strong inflation could last longer than previously seen. Furthermore, Rhee noted that policies will continue to be inflation-focused for a while and said there will be no change in the 25bps rate increase stance for the foreseeable future.

NOTABLE HEADLINES

NOTABLE HEADLINES

UK car production rose for a 3rd consecutive month with output up 8.6% Y/Y to 58k units in July, according to SMMT.