Market Update – August 27 – All Eyes on Jackson Hole

Market News Today 

  • USD (USDIndex 92.98) rallied on hawkish taper talk from Kaplan, Bullard and George to 93.13 before cooling.
  • Yields held on to gains & flattened (10yr 1.342%), while
  • Equities fell on stronger USD & ISIS-K attack at Kabul Airport (85 dead inc. 13 US soldiers, Biden promises response). (USA500 -0.58% @ 4470, FUTS at 4480 now). Dell, Peloton & HP all reported weaker earnings.
  • US GDP Q2 2nd reading 6.6% vs 6.7%, Weekly Claims 353k vs 345k
  • Overnight – Asian stock markets were mixed – US COVID hospitalizations tops 100k 8-mth high. AUD retail sales worse than expected (-2.7% vs -2.6% & -1.8% previously), German import prices rising (2.2% vs 1.2% & 1.6%)
  • USOil spikes back over $68.00, to $68.20 now, from $66.65 lows yesterday.
  • Gold rallied from $1780 yesterday to over $1800 ($1803 now.)


European Open – The September 10-year Bund future is down -0.8 ticks, US futures steady to higher, as US cash yields climbed down from yesterday’s highs.

Markets are positioning for Fed Chair Powell to map out a taper schedule today, although it seems at this point a taper tantrum can be avoided. Investors are likely to be cautious ahead of the speech and DAX and FTSE 100 are currently down -0.16% and up 0.07% respectively.

In FX markets EURUSD lifted to 1.1762 as the dollar erased earlier gains. Cable is little changed at 1.3700. There is nothing really on the European calendar to distract from the focus on Powell.

Today US PCE/Core PCE, Personal Income, Uni of Michigan (Final), Fed Chair Powell, Bostic, Harker, Mester, Bullard.


Biggest Mover @ (06:30 GMT) USOIL (+1.57%) Spikes back over $68.00, to $68.20 now, from $66.65 lows yesterday. Broke 21 EMA earlier, at $67.40 next resistance $68.25. Faster MA’s aligned higher, MACD signal line & histogram still above 0 line & rising. RSI 60.70 and rising.  MFI 89 & in OB zone. H1 ATR 0.35, Daily ATR 2.10.

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Stuart Cowell

Head Market Analyst

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