Market Talk – September 20, 2016

Market-Talk (1)__1454353396_72.94.249.194

Most markets were in a holding pattern awaiting the outcome of central bank decisions. The Nikkei faltered initially but was short-lived as by the end of the day we closed almost unchanged. The BOJ decision expected within the next 24 hours could direct trading for the next few months. Most are looking for additional stimulus with mid-term JGB purchases and the likely outcome for a stronger JPY. This evening we are seeing the Yen trade around the 101.75 level whilst Nikkei futures hover close to unchanged cash close.

Europe is also in limbo as we await the central bank decisions and therefore plot future course. Most core markets closed with small positives but volumes were low with many running small books ahead of the possible increase in volatility. We do continue to see the USD (DXY) edge firmer as money moves away from areas of uncertainty. The GBP remains heavy post the BREXIT vote despite the economic data contradicting the uneasiness.

US indices opened strong but drifted back when oil turned. Again, many nervous dealers are happy running thin books ahead of both decisions but once out, most will be focusing on bank stocks. The markets expect little change by the BOJ but the question remains, will the FED continue to play the happy mediator role or will they finally break this pretence. The US Treasury market today saw bull flattening with 2’s a smidgen lower at 0.775% whilst 10’s gained 2bp closing at 1.69%; 2/10 closed +91.5bp. We also saw a similar move in Germany with 2’s -1bp at -0.675% and 10’s 3bp better and back in negative territory at -0.015%; US/Bund spread closed +170.5bp. Italy 10’s closed 1.25% (-6bp), Greece 8.35% (-12bp), Turkey 9.58%, Portugal 3.28% (-5bp) and UK Gilts at 0.80%.

Latest Posts

Market Talk – February 6, 2025

ASIA: The major Asian stock markets had a mixed day today: • NIKKEI 225 increased 235.05 points or 0.61% to 39,066.53 • Shanghai increased 41.17 points or 1.27% to 3,270.66 [...]
Read more

Distributive Bargaining

Distributive bargaining is a competitive negotiation approach where one party aims to maximize its share from a limited pool of resources. This strategy is often called zero-sum negotiation, as the [...]
Read more

Zelensky to Speak with Putin?

Three years into the war and Ukrainian President Volodymyr Zelensky has finally stated he is willing to TALK to Russian President Vladimir Putin. Both Putin and Zelensky would like Trump [...]
Read more

Gaza – The Riviera of the Middle East

President Trump announced that the US will be taking over the Gaza strip after a press conference with Israeli Prime Minister Benjamin Netanyahu. Trump envisions transforming Gaza into an international [...]
Read more