Morning Brew September 20 2021
Senior Relationship Manager
Summary: Risk Aversion hits a Chinese holiday again PM sold off again
Risk aversion hits markets again on an Asian holiday, with the USD gaining and equities falling.
The USD Index broke above 93 to trade at 93.30 EURUSD 1.1710, GBPUSD at 1.3710 and Gold and silver further under pressure to trade at 22.30 and 1750.
Indexes continue their decline started on Friday, the Dow closed 0.48% lower on Friday, the , S&P 0.91% and the Nasdaq 0.91% and over night give up ground overnight. At the moment the US 500 is trading at 4400, well below the 50d MA. The US 30 at 34300 and the Germany 40 at 15375. Hong Kong shares fell to an 11-month low, Shares of Evergrande fell % to their lowest in over 11 years
Driver behind the nervousness are central bank meetings this week with the FOMC of the US Federal Reserve on Wednesday the key, but also the UK, Japan. Norway and Switzerland will release their rate decisions. Also, worries about Evergrande and the question if a collapse of the company would be a “Lehman Moment” for the financial system is widely and controveresly discussed.
Olaf Scholz won the last TV Duel ahead of the election next Sunday.
The National Highway Traffic Safety Administration (NHTSA) is investigating Airbag safety in as many as 30 million vehicles by a wide range on manufacturers.
There is little on the agenda today , the German Producer Prices have been released higher than expected, MoM at 1.5% vs 0.8% expected and YoY 12% vs 11.4% expected.
The FOMC and the Bank of Japan on Wednesday, the Australian PMI the Bank Of England, the Norwegian central Bank and the SNB European PMI on Thursday and the IFO index on Friday are likely to be key. Clear priority is with the FOMC.
Never forget surprises, sentiment and this week Evergrande of course