- Good moods in Asia, MSCI at 10-year high, JAP225 surges
- NZDUSD declines as USD recovers on higher yields
- Solberg wins in Norway, could that support NOK today?
Asian session passed in very good moods as investors cheered calmer geopolitical situation and smaller than expected impact of the Irma Hurricane on the US coast. We can see bond yields recovering and equity indices surging around the globe. MSCI Asia-Pacific ex Japan inched up by 0.2% today to hit the levels highest since 2007. Nikkei225 (JAP225 on xStation platform) surged by 1% as investors in Japan welcomed weaker yen. That could help at the opening in Europe where indices like German DAX (DE30) or Spanish Ibex (SPA35) staged a solid rally yesterday.
On the fx front NZD is the weakest currency, down nearly 0.5% against the greenback and the British pound and 0.4% against the CAD. The US currency benefits from a recovery in yields while the GBP cheers a pass of the first Brexit related legislation but stands a test of the CPI data today.
Solberg wins in Norway but her coalition is quite complex. Source: Bloomberg
The NOK could be quite interesting this week as the currency was under pressure yesterday on political uncertainty. The country went to polls and as it seems the ruling conservative prime minister was able to strike a narrow victory over a millionaire opponent. Markets could like the result as she promised tax cuts (unlike her opponent who wanted higher taxes for the rich) and offers continuation, albeit her coalition necessary for the majority is quite complex.
USDNOK faces a resistance at 7.85. Source: xStation5
USDNOK reaction will be a function of markets attitude towards Norway’s result and USD recovery. On the chart we can see that bulls were able to recovery from the key 7.70 area in a decisive way but now stand a test at 7.85. A favourable result could be a high hurdle at this level.
This article is provided for general information purposes only. Any opinions, analyses, prices or other content is provided for educational purposes and does not constitute investment advice or a recommendation. Any research has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Any information provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it.
Past performance is not necessarily indicative of future results, and any person acting on this information does so entirely at their own risk, we do not accept liability for any loss or damage, including without limitation, any loss of profit, which may arise directly or indirectly from the use of or reliance on such information.