General Market Comment
US indices closed mixed on Monday as the three North American countries have finalized a new trade agreement called “USMCA”. Shares in the Consumer Services (-1.31%), Real Estate (-0.85%) and Utilities (-0.3%) sectors traded lower while shares in the Energy (+1.47%), Capital Goods (+1.2%) and Materials (+1.04%) sectors gained a bit of strength. On the economic data front, Markit US manufacturing PMI remained unchanged MoM in September at 55.6, as expected. On the other hand, construction spending edged up 0.1% in August (estimated +0.4%), compared with an increase of 0.2% in July. In other news, ISM manufacturing decreased to 59.8 in September (forecast 60) from 61.3 in August. The S&P 500 (2,924.59) remains above its 20d moving average (2,902.66 – positive slope) and 50d moving average (2,870.63 – positive slope).
European markets are expected to start on a flat note.
Foreign Exchange
The US dollar was bullish against most of its major pairs on Monday with the exception of the GBP and the CAD. On the economic data front, Markit US manufacturing PMI remained unchanged MoM in September at 55.6, as expected. On the other hand, construction spending improved slightly by 0.1% in August (estimated 0.4%) from an increase of 0.2% a month earlier. In other news, ISM manufacturing decreased to 59.8 in September (forecasted 60) from 61.3 in August.
The Euro was bearish against all of its major pairs. Euro zone PMI manufacturing index was 53.2 in September in final estimation, vs 53.3 in first one and 54.6 a month earlier. German retail sales fell 0.1% in August after a 0.4% decline the month before. They were expected to be up 0.5%. UK PMI manufacturing index increased to 53.8 in September from 53 in August (revised from 52.8). It was anticipated to be 52.5. Separately, mortgage approvals in UK were up to 66.4K in August from 65.2K in July (revised from 64.8K). Consensus was 64.5K.
The Australian dollar was higher against most of its major pairs with the exception of the GBP and the CAD.
Commodities
After the close of Wall Street, WTI Crude Future (NOV 18) was up $2.4 to $75.63. The contract was above its 20D MA (@ $70.2) and above its 50D MA (@ $68.3).
Gold was down $3.8 to $1188.7. The precious metal was below its 20D MA (@ $1197) and below its 50D MA (@ $1202).
Copper Future (DEC 18) on Comex was down 1.8c to 278.65c/lb. The contract was above its 20D MA (@ 271.48c) and above its 50D MA (@ 273.31c). In Europe, the London Metal Exchange reported its copper inventories decreased 3275 tons to 199125 tons.