Intraday Market Thoughts

China PMI Preview & Latest Premium Insights

by Adam Button
Sep 19, 2012 22:44

Oil continued to fall Wednesday and is now down more than 9% from last weeks high. The yen was the top performer on the day, no doubt frustrating the BOJ. The focus shifts to China now with the impending release of the HSBC flash PMI. Ashraf's latest Premium Insights are out. See final paragraph for direct access.

WTI crude continues to plunge after breaking above $100 on Friday. Today, oil fell below $92 due to a large inventory build in the US stockpiles report. Downward momentum added to the move as QE3-based longs get squeezed out.

Over time, lower gasoline prices could be favorable for US customers and global growth. So far, oil also hasnt showed any signs of hurting CAD. That said, it is difficult to imagine a positive scenario where central banks continue to print and oil falls.

US housing data was in focus and showed tentative signs of a picku. Existing home sales rose to a pace of 4.82M from 4.56M expected. Housing starts were slightly below the consensus forecast but building permits were higher.

The Australian dollar twice attempted to break above 1.05 but stalled a few pips short. The Australian press reported on two more smaller-scale coal project cancellations totaling A$6 billion so risks to the Aussie remain to the downside.

AUD will also be in focus in Asian trading with the release of the HSBC flash China PMI at 0230 GMT. The prior reading of 47.6 was surprisingly low and another soft number would confirm a slowdown in Chinese manufacturing and weigh heavily on AUD and risk trades.

The other session highlight comes at 2245 GMT when New Zealand releases second quarter GDP. The consensus is for 0.4% q/q growth. On Friday, NZD/USD touched the highest since March and a strong report could extend the uptrend.

Latest Premium Insights on EURUSD, EURJPY, AUDSD, GBPUSD, CADJPY, gold, silver and oil are found here: Non subscribers can click here:



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