Market Brief: Markets Take Trump’s Impeachment Inquiry Within Stride



FX Brief:        

  • RBNZ held rates as expected, although scope for further fiscal and monetary stimulus remains “if needed”. Data since their August MPS (Monetary Policy Statement) didn’t warrant a significant change to their outlook and RBNZ are “pleased” with their lower currency – points we both outlined in yesterday’s RBNZ preview.
    NZD and USD are the strongest majors, JPY and AUD are the weakest, although ranges remain narrow outside of NZD pairs.
  • NZD/USD hit a 5-day post meeting, AUD/NZD broken beneath key support to confirm a double top and the biggest gainer is NZD/JPY, currently the only pair to exceed its typical daily range.
  • As for the dollar, it’s retraced from yesterday’s lows across the board yet several pairs warrant a closer look; USD/CHS is trying to break its bullish trendline form August, USD/CAD is trying to carve out a top, USD?JPY is back above 107 and EUR/USD is considering another break of 1.10.  
  • Cryptocurrencies have made a minor effort to pare losses endured during yesterday’s crypto rout. Yet given the double-digit losses sustained across the board, traders may be on the look out for a dead-cat bounce to fade.



Data from Refinitiv. Index names may not reflect tradable instruments and not all markets are available in all regions.

Equity Brief:

  • Democrats launched a formal impeachment inquiry into Donald Trump, although this could be the slow path to nowhere as it will require at least 20 Republican’s to flip on Trump to officially oust him. After no doubt many investigations. S&P500 E-mini futures are taking it all within stride and trade slightly higher on the session.
  • Still, it didn’t prevent the ASX200 rolling over at the open and equities across Asia are mostly in the red.  At the sector level, info tech and utilities lead the ASX200, energy and materials lag. Iron ore prices also weighed on miners, with iron ore producer Mount Gibson Iron falling over 8% on the session. At the other end of the board is Afterpay Touch Group, which rallied to an all-time high after filing its external audit report, which found no evidence of money laundering or terrorism financing activity. The broader ASX has seen 31.4% stocks advance, 45.5% decline and 23.1% unchanged.
  • The Hang Seng Index is the biggest decliner among the indices we closely track and currently trades at a 3-week low. The Nikkei sank to a 5-day low (although mean reversion appeared overdue anyway) whilst China A50 and Kospi 200 remain relatively unscathed relative to their cycle highs.




Up Next

  • Fed voting members Evans, Brainard and George are all due to speak later, so USD pairs and indices could react to any policy related comments (less dovish is likely good for stocks or more hawkish less so).
  • With no major economic data released, it will be any headlines surrounding Brexit or Trump’s impeachment proceedings which are likely to move markets to any notable degree.

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.