Forex News from InstaForex

[IFX Gertrude]

Wall Street Advanced as Trump Signals Support for Debt Limit



U.S. stocks climbed after two top Democratic leaders said President Donald Trump will support a debt ceiling extension and government funding plan. Energy shares were also higher as stocks rebounded from a day-earlier selloff.

The Dow Jones industrial average gained 0.25 percent to 21,807.64, as Home Depot and Chevron contributed the most gains. The S&P 500 rose 0.31 percent to 2,465.54, with energy and consumer discretionary among the best performers. The Nasdaq composite climbed 0.28 percent to 6,393.31, with some large-cap stocks, such as Netflix and Facebook, regaining ground.

The energy sector climbed 1.6 percent, for its largest single-day gain in two months, as oil prices increased. Oil majors Exxon Mobil and Chevron both gained two percent which buoyed the S&P 500 and the Dow.

Financials were up 0.2 percent following their biggest one-day decline since mid May. Nine of 11 major sectors closed in the green.

Vacation and timeshare stocks also dropped as investors focused on Category 5 Hurricane Irma. Shares of Hilton Grand Vacations fell 1.44 percent and Marriott also dropped nearly one percent.

United Continental Holdings and Newell Brands were among the worst performers in the S&P 500.

Airline company United trimmed its unit revenue and pre-tax margin guidance for this quarter, citing Hurricane Harvey. Newell Brands wrote in a statement that “nearly all” of its resin suppliers in Louisiana and Texas are shut down due to Hurricane Harvey.

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[IFX Gertrude]

Japan GDP Bumped Down To 0.6% In Q2



Japan's gross domestic product was knocked down to 0.6 percent on quarter in the second quarter of 2017, the Cabinet Office said in Friday's revised reading.

That missed forecasts for 0.7 percent and was down from the August 13 preliminary reading that suggested a gain of 1.0 percent. GDP was up 0.4 percent on quarter in the previous three months.

On a yearly basis, GDP was knocked down to 2.5 percent, again missing expectations for 2.9 percent and down sharply from the preliminary reading of 4.0 percent. GDP had advanced 1.5 percent in Q1.

Nominal GDP was revised down to 0.7 percent on quarter, missing forecasts for 0.9 percent and down from 1.1 percent in the preliminary reading. It fell 0.3 percent in the three months prior.

The GDP deflator was down 0.4 percent on year, unrevised and as expected. It was down 0.8 percent in the first quarter.

Private consumption was revised down to 0.8 percent, shy of forecasts for 0.9 percent, which would have been unchanged. It added 0.4 percent in the previous three months.

Business spending gained 0.5 percent on quarter, matching forecasts but down from 2.4 percent in the preliminary reading. It was up 2.4 percent in the first quarter.

The Japanese economy has now expanded in six straight quarters, the first such streak in more than three years.

Also on Friday: The Bank of Japan said that overall bank lending in Japan was up 3.2 percent on year in August, coming in at 515.802 trillion yen.

That was shy of expectations for 3.3 percent, which would have been unchanged from the July reading.

Excluding trusts, bank lending was also down 3.2 percent to 448.603 trillion yen. That missed forecasts for 3.4 percent, which would have been unchanged from the previous month.

Lending from trusts was up an annual 2.8 percent to 67.199 trillion yen - up from 2.7 percent a month earlier. .

The Ministry of Finance said that Japan had a current account surplus of 2,320.0 billion yen in July, up 19.6 percent on year.

The headline figure topped expectations for a surplus of 2,030.1 billion yen and was up from the 934.6 billion yen surplus in June.

The trade surplus came in at 566.6 billion yen, exceeding expectations for 518.0 billion yen and up from 518.5 billion yen in the previous month.

Imports were up 17.7 percent on year to 5,834.5 billion yen, while exports climbed an annual 15.2 percent to 6,401.2 billion yen.

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[IFX Gertrude]

Euro Strengthens Ahead of ECB Decision; Riksbank in Focus



The euro moved higher versus a group of currencies ahead of the European Central Bank meeting where policymakers might deliver a cautious tone regarding the currency's strength.

Few expect the ECB to announce a trim of its monthly asset purchases at the policy meeting, which is a significant reversal from recent months when several people expected such a move.

The euro rose 0.1 percent versus the dollar at $0.1928 in early trading.

The common currency has gained over 13 percent so far in 2017 and is also the world's top performer in major currencies.

Markets will also pay attention to the policy decision from the central bank of Sweden where policymakers are seen to keep interest rates unchanged.

The Swedish crown is the only major currency that has acquired gains versus the resurgent euro in 2017. Market watchers anticipate for the crown to extend gains given that the central bank signals a hawkish bias.

The krona climbed 0.1 percent versus the euro. The Swedish currency has marked three months in a row of gains until end of August, according to data from Thomson Reuters.

Against a broad trade-weighted basket of peers, the U.S. dollar fell 0.2 percent at 92.14.

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[IFX Yvonne]

Brexit Squeeze Set to Hit Worker Earnings



Reports from the Office for National Statistics are expected to show pay that continues to weigh on price growth in Britain. Last week, employees at the Bank of England reached an agreement while employees of a few McDonald's restaurants went on strike demanding higher pay.

According to a survey from Bloomberg, soft consumer spending growth is one of the main factors as to why the central bank will likely keep its benchmark rate at a record-low of 0.25 percent on Sep. 14. Although, the pound's weakening since the Brexit vote has been pulling up import costs, two policymakers are also seen to push for a rate hike in order to keep prices in check.

Survey data revealed that consumer-price inflation accelerated to 2.8 percent last month, which surpasses wages that are expected to have increased slightly over two percent in July, in a report to be released on Wednesday.

Quicker inflation is particularly distressing for public sector workers, laboring under a one percent cap on salary raises imposed as part of austerity measures since 2010. Nurses are among the lower paid with an average income of 23,500 pounds ($31,000) per year, according to the Royal College of Nursing.

Demands to end the public-sector pay cap is expected to be a key subject matter when the Trades Union Congress meets this week.

The BoE is facing a trade-off between supporting economic expansion with record-low interest rates and heading off inflation incited with higher borrowing costs.

[IFX Gertrude]

PERU: Mining Investment Rises 1.5%, Interrupting Three Years Of Decline



Peru's mining sector investments between January and July 2017 reached US$ 2.372 billion, a 1.5% growth compared to the same period of the previous year.

It was also the first increase since May 2014, according to the Peruvian Ministry of Energy and Mines.

Almost all mining investment items posted increases in the period: exploration (+25.2%), mining equipment (+25.1%), preparation (+23.6%), infrastructure (+22%), equipment (+12%) and investments in operation (+10.5%).

Mining exploration investments totaled US$ 237 million.

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[IFX Gertrude]

Gold Prices Edged Down as Risk Appetite Increases



Gold extended losses from the session earlier on Tuesday, as equities firmed while the dollar gained ground. Investor appetite for risk showed signs of growing.

Spot gold slipped 0.1 percent to $1,325.56 per ounce. In the session earlier, it dropped 1.4 percent in its largest one-day percentage loss since early July.

U.S. gold futures for December delivery fell 0.4 percent at $1,330.00 per ounce.

The dollar held on to large gains on Tuesday after a sharp rebound versus the yen and euro. Gold is sensitive to moves in the dollar. A stronger dollar makes gold more expensive for holders of foreign currency.

“Market players who were bracing for North Korea to conduct another missile launch over the weekend to mark their foundation day, were relieved when Pyongyang decided to host a celebration instead,” according to Lukman Otunuga, research analyst at FXTM. “This reprieve has rekindled appetite for riskier assets, and supported the greenback, while punishing safe havens such as gold.”

U.S. inflation expectations fell in August, with the year-ahead measure reaching its weakest level since early 2016, according to a Federal Reserve Bank of New York survey that contributes to the low price measures.

SPDR Gold Trust, the world's biggest gold-backed exchange-traded fund, said its holding increased by 0.14 percent to 835.68 tonnes on Monday from 834.50 tonnes on Friday.

Elsewhere on the Comex, silver futures lost 28 cents or about 1.58% to $17.84 per troy ounce.

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[IFX Gertrude]

ARGENTINA: Annual Inflation Rises To 22.8% In August, Says Central Bank



The annual inflation rate in Argentina increased to 22.8% in August, from 21.8% a month before, remaining above the 12% to 17% target range for this year, according to the country's central bank.

The annual inflation reading combine data from the new Argentinean inflation index, which has national coverage, and the previous benchmark index, which monitored prices only in Buenos Aires metropolitan area.

The new consumer price index showed that monthly inflation in Argentina was at 1.4% in August, from 1.7% in July. The former benchmark index revealed that in Buenos Aires metropolitan area monthly inflation fell from 1.7% to 1.5%.

Both readings, however, were below the 1.6% market expectation, according to a recent central bank survey.

Argentina's monthly inflation was primarily influenced by rising prices of health, housing, water, electricity, and fuels. Year-to-date, inflation in Argentina stands at 15.4%.

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[IFX Gertrude]

Wall Street Gains as Dow, S&P 500 and Nasdaq End at Records



U.S. equities advanced to all-time peaks on Tuesday as financials received a lift from rising yields. Wall Street also priced in comments from Treasury Secretary Steven Mnuchin on tax reform.

Investors paid attention to Washington after Treasury Secretary Mnuchin said he is “hopeful” that tax reform will be accomplished by year's end and that the administration is contemplating on backdating reform to Jan. 1.

The Dow Jones industrial average ended at 22,118.86, notching a record finish. Goldman Sachs contributed the most to advances, with DowDuPont being among the best-performing stocks in the index, finishing 2.5 percent higher.

The S&P 500 advanced 0.3 percent, hitting intraday and closing records. The index ended the session at 2,496.48. The Nasdaq composite rose 0.3 percent at 6,454.28, a record closing peak, after briefly declining.

Financials climbed over one percent, with six major lenders higher between 1.5 percent and 2.6 percent, after Goldman Sachs revealed a growth plan that could contribute almost $5 billion in revenue annually.

Shares of McDonald's dropped over three percent on a report that a research company had raised concerns regarding its third-quarter sales.

Apple held its annual consumer products event, where it unveiled three new iPhone models and an Apple watch. Its shares fell 0.4 percent, after fluctuating between gains and losses for most of the session. For the year, Apple soared around 40 percent.

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[IFX Gertrude]

VENEZUELA: ANC Dismisses European Call For Sanctions



Venezuela's National Constituent Assembly (ANC) rejected the European Parliament call for sanctions against the country and its condemnation to the election held on July 30 in the South American country.

"From this empowered and sovereign National Constituent Assembly, we reject all attempts to intervene in Venezuela. We repudiate all actions against our homeland aimed at its intervention," said the ANC chairwoman Delcy Rodr?guez during the session, according to the Venezuelan News Agency.

Earlier, the European Parliament stated that "does not recognize these elections nor the actions or decisions adopted by the recently constituted Assembly due to its lack of legitimacy."

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[IFX Gertrude]

European Stocks Flat as Miners Drop, Apple Suppliers Add Pressure



European markets finished relatively flat on Wednesday, as a mixed performance from overseas markets and a sharp drop in mining stocks added pressure on the region.

The pan-European Stoxx 600 closed 0.02 percent lower, while sectors pointed in different directions. The French CAC 40 and German DAX finished on a high, ending 0.17 and 0.23 percent respectively. A decline in London-listed miners weighed on the FTSE 100, which ended 0.28 percent lower.

Basic resources stocks led declines, as profit-taking hit metal prices. The sector dropped 1.75 percent after commodity traders claim an emergence of funds offloaded copper and had failed to carry into the market, according to a report from Reuters.

Anglo American, Antofagasta, BHP Billiton and Glencore all closed lower by two percent or more, on the back of a drop in copper and nickel prices.

Chipmakers supplying to Apple were among the worst performers, with AMS falling 3.9 percent, Dialog Semiconductor dropped 1.6 percent and STMicro rose 0.1 percent.

Traders said their shares were weighed down by Apple's new $999 iPhone X that will ship later than expected, on November 3. The price tag could also pull down demand for the device in markets like China.

Chipmakers have been the best performing among tech stocks this 2017, accounting for a large part of the sector's outperformance. Shares of AMS have gained 165 percent year-to-date.

Looking to media stocks, France's Vivendi, jumped towards the top of the benchmark after UBS upgraded its stock rating for the company to "buy" from "neutral". Vivendi shares rose 2.78 percent.

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