Article / 19 June 2017 at 7:00 GMT

Morning Markets: Sterling drops into start of Brexit talks

Head of Editorial Content / Saxo Bank

Morning Markets


  • South Africa: CPI (0800 GMT)
  • US: API statistical bulletin (1430 GMT)
  •  Japan: Reuters Tankan Index (2300 GMT) 

Asian stocks were higher Monday with European bourses prepared to follow their lead into today's start of the Brexit negotiations between Britain and the European Union.

One person has died and eight more are injured after another potential terror attack in London in which a man drove a van into a crowd of pedestrians outside a Finsbury Park mosque. 

GBP is 0.1% lower versus the dollar as Britain prepares to negotiate its future with regard to Europe; EURGBP is rising into the European bell as well at 0.8772. 

Commodities headed lower in Asia with crude prices down 0.3% for both brent and WTI variants. Gold headed lower as well, posting a 0.1% loss as the latest step in a multi-day decline following the Federal reserve rate hike last Wednesday. 

Today sees South African CPI data out at 0800 while the US API statistical bulletin is due at 1430 GMT.

Market signals

Asian session

  • Brexit talks open today almost one year after the country voted to leave the EU
  • Asian markets were higher today ahead of Brexit negotiations
  • FOMC members may comment on monetary policy at various forums this week
  • New home prices in China rose 10.4% year on year in May after a 10.7% rise in April
  • NZ consumer confidence rose in the June quarter to its highest level since early 2015 
  • US retail fears hit Australia, with falls for Harvey Norman, Woolworths and Wesfarmers
  • The S&P/ASX200 made gains, despite the heavy falls for retailers
  • RBA governor Philip Lowe gave an upbeat view of the Aussie economy

Forex ahead

  • The US dollar made gains against the yen; it was worth ¥111.05 at 0755 GMT
  • The outlook for the Australian dollar looks bullish, helped by firmer copper prices
  • The kiwi dollar strengthened to 0.7263 against the USD
  • The Aussie dollar was worth 0.7611 at 0755 GMT
  • The Mexican peso hit a 13-month high against the USD last week
  • MXN looks likely to gain further ground against USD

From the Floor

Macron again.The big news headline-wise over the weekend was Macron’s legislative election victory, but turnout was at record lows and that casts a shadow over his mandate,” says Hardy.

Retailers sold.[There’s been a] continuation of selling of retail groups globally after Amazon’s offer for Whole Foods,” says Horchani.

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

In opinion

Upbeat PMI releases and Bank of Japan optimism point to a prolonged recovery for Japan, the world's third-largest economy, says James Picerno.

Fed focus
The key focus this week will be the Federal Reserve speakers, as well as the flash PMIs and what the RBNZ decides to do, writes Kay Van-Petersen.

Bracing for Brexit talks
Asian markets await the fallout from Brexit negotiations starting formally today between the UK and EU, writes the team at Saxo APAC Sales Trading.

Snap's dream country

If the heads of Snap Inc. can somehow manage to convince the world's largest markets to act as they do in Norway, the sky is the limit says Clemens Bomsdorf.

 Today's Tankan update may reveal whether Japan’s recovery – its third-longest postwar expansion – will last and become its second-longest run of growth. Photo: Shutterstock

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