James Kim@Saxo
James Kim, sales trader at Saxo Capital Markets Australia, examines trading strategies during week 43 in a technical analysis of charts for forex, indices and commodities.
Article / 04 July 2016 at 7:02 GMT

Morning Markets: Silver soars and equities gain

Deputy Editor /




  • UK June Construction Purchasing Manager Index (0830 GMT)
  • Eurozone July Sentix Investor Confidence (0830 GMT)
  • Canada RBC Manufacturing PMI (0930 GMT)

Markets are closed today in the US for the July 4 public holiday, but it was business as usual in Asia. China's benchmark Shanghai Composite was the star perfomer in Asia today, posting strong gains, driven by stimulus hopes. The Nikkei 225 also headed into positive territory, reversing an opening tumble. In Australia, uncertaintly about the outcome of the July 2 election weighed on investor sentiment; the result is too close to call, and counting will continue this week. 

But the real star of the show is silver which traded above $21/oz for the first time in two years, buoyed by hopes of monetary policy easing by the major central banks.  Gold is also gaining ground in this uncertain post-Brexit environment, while both crude oil benchmarks are also robust.

The economic calendar is relatively light this session but the Sentix investor confidence index at 0830 GMT will provide a useful clue as to sentiment in the bloc in the wake of the British referendum shock. For now, Britons seem adrift in a sea of uncertainty will the Brexiteers still claiming that the country can rapidly secure bilateral trade deals and also retain its access to the single market despite increasing rhetoric from Europe that this will not happen.

Market signals

Asian session

  • Demand for gold gained ground; it was worth $1349.50/oz at 0320 GMT
  • Silver benefited from gold's strength; it was worth $20.45/oz at 0320 GMT
  • US markets are closed today for the Independence Day holiday
  • Japan's Nikkei 225 rebounded strongly from an early tumble
  • The Nikkei 225 was up by a healthy 0.52% to 15,763.25 at 0529 GMT
  • Japan's monetary base unexpectedly fell last month to 25.4%; 26.3% was expected
  • China's Shanghai Composite surged sharply higher on stimulus hopes
  • The Shanghai Composite was up a robust 1.72% to 2,983.02 at 0546 GMT
  • India's S&P BSE Sensex was up 0.72% to 27,341.23 at 0555 GMT
  • Australia's monthly MI inflation gauge was 0.6% in June, up from April's minus 0.2%
  • Australian building approvals for May fell 5.2% compared with a 3.3% rise in April
  • Australia's July 2 election result is too close to call, and may result in a hung parliament
  • Election result uncertainty weighed on sentiment in the Australian sharemarket
  • Australia's benchmark S&P/ASX200 made gains despite the political uncertainty
  • The S&P/ASX200 was up 0.24% to 5,259.40 at 0502 GMT

Forex ahead
  • The US dollar was worth ¥102.7000 at 0547 GMT
  • AUDUSD gapped down after the Australian election failed to produce a clear result
  • The Australian dollar was worth 0.7499 at 0548 GMT

From the Floor

Countdown. “It’s all about Super Friday with the US NFP and an anticipated 180,000 — risk is to the upside”, says Kay Van-Petersen

Shining star. “Silver hit a two-year high as the ratio to gold continues to collapse”, says Hansen

Get all the latest from Saxo Bank's trading floors in From the Floor, within the hour.

In opinion

Euro area Sentix investor confidence is expected to give up last month’s outsized gains, while the UK's construction sector continues losing its optimism, writes Juhani Huopainen.

Monday blues
Both the AUD and Aussie equities had a poor start to Monday, on the back of an undetermined  election result as Saxo Capital Markets and the Saxo Singapore team report.


 Looking ahead ... US markets are closed for today's Independence Day holiday but
Friday's jobs report will be on the mind of many. Photo: iStock

Morning Markets goes out on the TradingFloor platform at 0700 GMT, Monday to Friday.
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