Asian markets are set to open on the back foot today as fears over global growth continue to dominate investor sentiment. The US markets closed well in the red and European bourses faired even worse, the futures market has the ASX and Nikkei opening firmly to the downside and risk assets and currencies are all looking vulnerable. Investors will continue to focus strongly on the news wires as the Trump administration shows no signs of pulling back from it’s tariff commitments despite rumours that conciliatory talks between the two super powers have been proposed. Any sign that talks may be in the offing should see a bit of a relief rally for the beleaguered markets, but any continuation of the current situation will see more pressure to the downside.
The Euro came under a bit of pressure in the London session as Italy announced the appointment of two Euro sceptics to its parliament, but it regained its level later in the day as it once again based just above the 1.1500 level. The sterling traded strongly after the BoE rate announcement with the futures market now pricing in a August hike at 70% after MPC member Haldane voted for a hike at the meeting.
Looking ahead to todays trading and the global Trade turmoil theme will continue to dominate sentiment into the weekend, but also expect the OPEC meeting in Vienna to contribute to some volatility in the Oil market. The Cad has potential for some significant moves today as aside from the OPEC meetings we also have key CPI and Retail Sales numbers due out of Canada in the New York session.