In This Article:
Earlier in the Day:
There were no major stats released through the Asian session this morning to provide direction for the markets, with geo-political risk was left to dictate market sentiment and direction for the major pairings through the session, with China new loan and FDI numbers not due out until the tail end of the Asian session.
Through the early part of the morning, the Turkish Lira was down another 1.92% to 6.9585 against the Dollar, the continued slide gripping the global financial markets at a sensitive time, where an ongoing trade war with China, fresh sanctions on Iran and new sanctions on Russia are already testing market resolve.
At the time of writing, the Japanese Yen was up 0.60% to ¥110.16 against the Dollar and up 0.92% to ¥125.35 against the EUR, as concerns over the effects of a Turkey financial crisis on the Eurozone and, European banks in particularly, weighed early.
Demand for U.S Dollar was also evident, with the Aussie Dollar sliding 0.45% to $0.7269, tumbling commodity prices adding further pressure on the Aussie that is at $0.72 levels for the first time since the beginning of the year.
For the Kiwi Dollar, things were a little better, the Kiwi down just 0.06% to $0.6586, last week’s beating providing some sympathy at the start of the week, with some minor data out of New Zealand in the early hours more upbeat than recent data, the services sector seeing a jump in activity in July, with food inflation also accelerating.
In the equity markets, the risk off sentiment was clear, with the Nikkei down 1.6% at the time of writing, a pickup in the Yen adding to negative sentiment, while the Hang Seng and CSI300 led the way, the pair down 1.81% and 1.80% respectively.
For the ASX200, the 0.52% fall will be considered more moderate, though with the jump in the U.S Dollar and continued slide in metal prices, the big Aussie mining stocks were seeing far heavier losses early on, with BHP Billiton and Rio Tinto down 1.54% and 1.53% respectively at the time of writing.
The Day Ahead:
For the EUR, economic data out of the Eurozone is limited to finalized July inflation figures out of Italy, which are unlikely to have an impact on the EUR, which was under the hammer through the early part of the day, as market panic over a possible collapse of the Turkish economy continued to weigh, the Turkish Lira seeing more losses this morning.
At the time of writing, the EUR was down 0.30% to $1.1379, the EUR’s first visit to $1.13 levels since July of last year, the Turkish curveball and possible contagion effects on the European financial sector hitting the EUR hard.