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20 Sep 2007: Asian markets wait for Wall Street reaction to broker earnings, Bernanke testimony
- Forex: The AUD/USD pushed to 6week highs as investors regained an appetite for higher yields. USD/CAD remained in a tight range towards the end of the morning session (between 1.0130 and 1.0140), as some suggest that a proposed oil and gas royalty increase in the province of Alberta, a region rich in oil and gas, may end the rally in the CAD. EUR/USD remained capped by 1.3980 while USD/CHF flat-lined around 1.1825. USD/JPY remained below 116.00 for most of the Asian morning. With Goldman Sachs and Bear Stearns releasing their quarterly results, forex markets will likely keep a close eye on stock market movements tomorrow. Goldman Sachs CEO Blankfein said in a press interview that the current financial crisis has yet to play itself out, adding that it is highly probable that more adjustments are ahead. Between 17:00 ET and 23:07 ET: NZD/USD +0.06%, USD/JPY -0.17%, GBP/USD +0.07%, USD/KRW -0.24%, USD/CHF -0.15%, USD/CAD -0.17%, NZD/AUD -0.22%
- Japan large companies' business sentiment rebounds during Q3: (JP BSI LARGE ALL INDUSTRY QOQ: 6.2% V -0.9% prior; LARGE MANUFACTURING QOQ: 7.7% V -2.2% prior; First improvement in four quarters) Some said there was a possibility that the impact from problems in the U.S. subprime mortgage sector may not have been fully reflected in this data due to the timing of the survey. While the manufacturing sector increased capex plans, the non-manufacturing sector declined. Some analysts suggest that this indicates how shaky the Japanese situation is, as its outlook depends mostly on overseas economies.
- New Zealand current account widens during Q2: (NZ Q2 CURRENT ACCOUNT BALANCE: -2.91B V -3.29B expected, prior revised to -2.21B from -2.22B; CURRENT ACCOUNT as a % GDP: -8.2% V -8.5% expected, -8.5% prior) The current account deficit is smaller than expected but within this the net foreign liability position continues to rise, and for this reason some suggest that the deficit could widen from here. S&P has repeatedly said New Zealand's current account deficit was a source of concern, and may soon affect the country's sovereign rating.
- Equities: The Nikkei open higher but pared most of its gains by the end of the Tokyo morning, trading up by +0.08% at 23:02 ET. Leading gainers on the index include real estate companies (y/y rise in commercial land prices cited) and commodity related shares. Australia's benchmark ASX index (+0.27%) also failed to hang on to early gains, with banks being sold (liquidity in the Australian money market still remains tight). South Korea's Kospi index is higher by more than 0.40%, despite the FTSE failing to upgrade the status of South Korean markets. The Hang Seng opened at a new record high as property shares continue to gain.
- Commodities: Crude oil traded between $81.80 and 81.90 for most of the Asian session. Spot gold gained +0.23% between 18:00 ET and 23:04 ET, boosted by technical momentum after breaking above $730/oz, a 26yr high.
- Japan large companies' business sentiment rebounds during Q3: (JP BSI LARGE ALL INDUSTRY QOQ: 6.2% V -0.9% prior; LARGE MANUFACTURING QOQ: 7.7% V -2.2% prior; First improvement in four quarters) Some said there was a possibility that the impact from problems in the U.S. subprime mortgage sector may not have been fully reflected in this data due to the timing of the survey. While the manufacturing sector increased capex plans, the non-manufacturing sector declined. Some analysts suggest that this indicates how shaky the Japanese situation is, as its outlook depends mostly on overseas economies.
- New Zealand current account widens during Q2: (NZ Q2 CURRENT ACCOUNT BALANCE: -2.91B V -3.29B expected, prior revised to -2.21B from -2.22B; CURRENT ACCOUNT as a % GDP: -8.2% V -8.5% expected, -8.5% prior) The current account deficit is smaller than expected but within this the net foreign liability position continues to rise, and for this reason some suggest that the deficit could widen from here. S&P has repeatedly said New Zealand's current account deficit was a source of concern, and may soon affect the country's sovereign rating.
- Equities: The Nikkei open higher but pared most of its gains by the end of the Tokyo morning, trading up by +0.08% at 23:02 ET. Leading gainers on the index include real estate companies (y/y rise in commercial land prices cited) and commodity related shares. Australia's benchmark ASX index (+0.27%) also failed to hang on to early gains, with banks being sold (liquidity in the Australian money market still remains tight). South Korea's Kospi index is higher by more than 0.40%, despite the FTSE failing to upgrade the status of South Korean markets. The Hang Seng opened at a new record high as property shares continue to gain.
- Commodities: Crude oil traded between $81.80 and 81.90 for most of the Asian session. Spot gold gained +0.23% between 18:00 ET and 23:04 ET, boosted by technical momentum after breaking above $730/oz, a 26yr high.