Market Update – August 23 – Stocks Tank, Yields Up & USD at 20-yr high

USDIndex pushed to 20-yr highs over 109.00 (August low 104.5) and pressured EUR (under parity with Energy concerns weighing) & GBP (under 1.1750 with political and energy concerns weighing too).  Stocks tanked across the board (NASDAQ -2.55%) and Yields rallied (+1.78%) with the 10yr holding over 3%, and the yield curve still 30+bp inverted. Asian markets followed through too, (Hang Seng -0.81%, Nikkei -1.20%) and European FUTS are lower. Oil gyrated over $4.70, after Saudi Energy minister said they may have to CUT production. Gold down again, holds at $1735 and BTC broke under $21k now.

Overnight – PMIs miss – AUD Services under 50.0 and contracting at 49.6 vs 54.0, JPY Manufacturing 51.0 vs 52.1, BOJ Core CPI, hotter 1.8% vs 1.5%. 

Week Ahead Jackson Hole 25-27, Global PMIs from 23/8, US Durable Goods  24/8, US & German  GDP 25/8 & US PCE 26/8. Wednesday (24/8) – 6-mths. since Russia’s invasion of Ukraine.

USDIndex continued to rally; above late 2002 highs, and trades at 109.15. EUR and GBP weaken as winter energy crisis looms.
EquitiesUSA500 closed down 90.50pts (-2.14%) to 4137, US500FUTS at 4122 now Tech leading the decline & Meme stocks in play again (AMC -41.95%, NFLX -6%, Ford -5.04%).
Yields 10-year yield rallied to 3.037% into close and trade at 3.0165% now.  The 2/10yr. yield curve cooled but remains inverted by 29.95 bp.  
Oil – dropped to $86.24, before recovering to $90.95 now, following comments from SA Energy minister. 
Gold – remains under $1750 today at $1736 now, having tested into $1725 support area yesterday. 
Bitcoin pressured and down to $21k now.
FX MarketsEURUSD down under parity at 0.99040 now. USDJPY rallied to 137.70 earlier and trades at 137.20 now. Cable tanked under 1.1750 and trades at  1.1725 now.

Today – UK & US Flash PMIs, EZ Consumer Confidence, US New Home Sales, Fed Discount Rate Minutes, Speech from ECB’s Panetta.

Biggest FX Mover @ (06:30 GMT) EURJPY (-0.57%). Rejected  138.00 yesterday and under 136.00 now. MAs aligning lower,  MACD histogram negative & signal line falling, RSI 23.36 OS & falling, H1 ATR 0.212, Daily ATR 1.37.


Click here to access our Economic Calendar

Stuart Cowell

Head Market Analyst

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.