So how do tensions in the Korean peninsula, Britain wanting their EU Talks to move to the next phase and Japan’s growth in the second quarter, affect our money? RAKBANK explain all

 

Currencies

 

The dollar edged higher against the yen on Monday, trading above last week’s near 4-month low over worries over geopolitical risks, the dollar came under pressure on Friday after softer-than-expected inflation data for July dampened expectations for another Fed interest rate hike this year. The dollar inched up 0.1% to 109.29 yen, edging away from Friday’s low of 108.72 yen, the greenback’s lowest level since April 19. China’s central bank raised its official Yuan midpoint for the fifth session in a row on Monday to 6.6601 per dollar, the strongest since Sept. 22, 2016, reflecting broad weakness in the U.S. currency in global markets. Sterling fell to a fresh 10-month low against the euro on Friday as investors added bearish bets against the British currency on concerns the economy may be struggling to gain momentum. The Canadian dollar was trading at C$1.2684 to the greenback, or 78.84 U.S. cents, up 0.5%. The currency, which was on track to fall 0.2% on the week, had retreated to C$1.2753 earlier in the session.

Treasuries/Rates

 

U.S. Treasury yields slipped on Friday on softer-than-expected inflation data for July. Both benchmark U.S. 10-year note and 30- year bond yields, which move inversely to prices, dropped to six-week lows after the U.S. inflation data, while yields on two-year notes, considered the most sensitive to rate hike expectations, sank to an eight-week low. U.S. 10-year yields dropped to six-week lows of 2.182% after the data, compared with 2.211% late Thursday. Ten-year yields were last at 2.188%. U.S. 30-year bond yields also fell to a six-week trough of 2.769%.

Commodities/Energy

 

 

Gold on Monday slipped from an over two-month high touched in the previous session, as the dollar edged higher against the yen. Spot gold was down 0.2% at $1,286.10 per ounce, after marking its highest since June 7 at $1,291.86 an ounce in the previous session. U.S. gold futures for December delivery fell 0.13% to $1,292.3 per ounce. Among other precious metals, silver was up 0.3% at $17.12 per ounce, after hitting its highest since June 14 at $17.24 an ounce last week. Platinum fell 0.1% to $978.95 per ounce and palladium was down 0.1% at $891.65 per ounce. Oil prices dipped on Monday as a slowdown in Chinese refining activity growth cast doubts over its crude demand outlook, while rising U.S. shale output suggested supplies would likely remain high. Brent crude futures, the international benchmark for oil prices, were at $51.94 per barrel, down 16 cents, or 0.3%, from their last close. U.S. West Texas Intermediate crude futures were at $48.74 a barrel, down 8 cents, or 0.2%.

Global Equities

 

Wall Street put a floor under global equities on Friday after a weak inflation reading brought investors back into U.S. stocks even as tensions between the United States and North Korea continued to escalate, though that tension still drove safe-haven buying of gold and the yen. The Dow Jones Industrial Average rose 14.31 points, or 0.07%, to end at 21,858.32, the S&P 500 gained 3.11 points, or 0.13%, to 2,441.32 and the Nasdaq Composite added 39.68 points, or 0.64%, to 6,256.56. The pan-European FTSEurofirst 300 index lost 1.01% and MSCI’s gauge of stocks across the globe shed 0.26% for a weekly loss of 1.6%, the largest since the week to Nov. 4. Emerging market stocks lost 1.27%. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 1.47% lower. South Korea’s KOSPI fell 1.7% on Friday to its lowest since May 24, but its losses for the week were a relatively modest 3.2%.

Regional Updates

 

Stock markets in the Middle East that are most exposed to foreign funds were the chief losers on Sunday, taking their cue from international bourses, where the mood was soured last week by growing tensions between the United States and North Korea. The worst performer in the region was Egypt’s blue-chip index, which dropped 1.4% as all but two of the 30 most valuable shares declined. The broader EGX100 fell 0.7%. Dubai’s index fell 0.9% in very thin trade, its largest single-day decline since June 21, as a little under three-quarters of listed shares fell. Emaar Properties, which is expected to report quarterly earnings in the coming days, fell 1.4%. Foreign funds were net sellers, bourse data showed. Saudi Arabia’s index edged down 0.2% as Middle East Healthcare, operator of Saudi German Hospital, slumped its 10% daily limit to 69 riyals after reporting disappointing quarterly results.

 


This document is issued by RAK BANK, while all reasonable care has been taken in preparing this document; no responsibility or liability is accepted for errors of fact or for any opinion expressed herein. Opinions, projections and estimates are subject to change without notice. This document is for information purposes only and for private circulation. It does not constitute any offer, recommendation or solicitation to any person to enter into transaction or adopt any hedging, trading or investment strategy, nor does it constitute any prediction of likely future movements in rates or prices or any representation that any such future movements will not exceed those shown in any illustration. Any investments discussed may not be suitable for all investors in any of the instruments or currencies mentioned in this document. You are advised make your own independent judgment with respect to any matter contained herein. In the UAE, RAK BANK conducts designated investment business only with Market Counterparties % Intermediate Customers and this document is directed only at such persons. Other persons should not rely on this document. Please call Santosh / Mahant / Imran / Rabia / Sunil +971-4-2913001 for FX/Deposit Rates.
Share