Today's edition of the Saxo Morning Call features the SaxoStrats team discussing the continuing weakness of the US dollar as commodity prices recover ground and in the wake of key US equity indices hitting all-time highs Thursday.
Article / 24 October 2017 at 7:00 GMT

Morning Markets: Xi crowned in China while markets worry about Adern

Senior Editor / Saxo Bank




  • EU: Markit Manufacturing PMI (0800 GMT)
  • EU: Markit Services PMI (0800 GMT)
  • US: Markit Manufacturing PMI (1345 GMT)

President Xi Jinping has cemented his status as China's most important leader since Mao Zedong after comrades at the Chinese Congress agreed to write his name into the party's constitution. The move bolsters Xi's standing and influence within China but also underlines his determination to play a greater role on the world stage and will likely help his ambition to "make China great again".

Elsewhere, it was a rocky session for the New Zealand dollar after details of the incoming government and its policy priorities emerged. Prime minister-designate Jacinda Adern said Winston Peters of the anti-immigrant New Zealand First party would be deputy prime minister and foreign minister and that their administration planned a thorough reform of the central bank act. The kiwi slumped some 2% to hit an overnight low of $0.6933, but later reclaimed some of the lost ground.

Today's economic calendar in Europe will give us updates on French business sentiment as well as Eurozone PMIs.

Market signals

Asian session

  • Asian markets were up in late trade shrugging off falls in Wall St overnight
  • The ASX200 closed largely unchanged
  • The Nikkei extended its 16-day winning streak to a 21-year peak
  • China's 19th Party Congress drew to an official close today
  • Chinese President Xi Jinping’s name was enshrined in the Communist Party charter
  • China's new leadership lineup is expected to be unveiled on Wednesday
  • Japanese manufacturing activity expanded in October but at a slower pace
  • Japan's flash index for new orders also fell to 52.4 from 53.4 in September

Forex ahead

  • USDJPY remains elevated above 113 for the first time since July
  • The Australian dollar traded early at 0.7805 against the USD
  • The NZD slid after the incoming government announced details of its policy priorities

From the Floor

Flightless kiwi. “We see more NZD weakness to come on the government’s economically unfriendly policy mix,” says Hardy

Tech retracement. “The FAAMG stocks are leading tech-sector declines into Thursday’s earnings” says Garnry

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

In opinion

Sluggish start
The ASX200 is slow off the mark after a weaker Wall St overnight, writes the team at Saxo Capital Markets (Australia).

Asia holds
The failure of US equities markets to rise overnight had little effect on Asian markets, which did not follow suit, says Saxo APAC trading

Mao and Xi

 The Once and Future King. Photo: 360b/Shutterstock

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