News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Mixed
Wall Street
Mixed
Gold
Bearish
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • #2020election polls continue to show Democratic nominee Joe Biden maintaining a strong lead #Trump Supreme Court nomination may throw a wrench into bipartisan stimulus talks #AUDUSD is trading at former resistance-turned-support. What happens if it breaks? https://www.dailyfx.com/forex/fundamental/article/special_report/2020/09/27/AUDUSD-Analysis-Ahead-of-Presidential-Debate-Supreme-Court-Nominee-Battle-.html
  • USD/MXN pushes higher as a long-awaited correction in the US Dollar gets underway. Get your #currencies update from @HathornSabin here: https://t.co/QMpun4KOgO https://t.co/KAYojshy0P
  • Emotions are often a key driving force behind #FOMO. If left unchecked, they can lead traders to neglect trading plans and exceed comfortable levels of risk. Read on and get your emotions in check here:https://t.co/eILWbFgHRE https://t.co/KXMefr6a3r
  • Join analyst @DavidJSong at 6:30 PM ET/10:30 PM GMT for your weekly update on key news trading events. Register here: https://t.co/gBlrRpCc55 https://t.co/5FwNLSVYje
  • *Reminder: Weekly Strategy Webinar tomorrow morning at 8:30am EDT on DailyFX! https://t.co/lxd5fZnn4H
  • EUR/USD fell sharply last week and there are few signs yet that the selling is over. However, a bounce is likely before the decline resumes. Get your #currencies update from @MartinSEssex here: https://t.co/BxglKuKVhj https://t.co/8nJQXhUTHI
  • The week ahead has many systemic issues that take control of the markets, but scheduled data is heavily skewed to the Dollar. Here is my video for the week ahead: https://www.dailyfx.com/forex/video/daily_news_report/2020/09/26/SP-500-Break-Risk-and-Dollar-Charge-Sees-Accelerants-Next-Week.html?ref-author=Kicklighter&QPID=917719&CHID=9?ref-author=Kicklighter&QPID=917719&CHID=9 https://t.co/PL3KZhn1HV
  • GBP turbulence persists as investors eye the next round of EU-UK Brexit negotiations. Cautious optimism signals a deal is near. Get your #currencies update from @PaulRobinsonFX here: https://t.co/WjU4oYpmf7 https://t.co/QJp3jpS3Ui
  • The AB=CD pattern is simple once you know how to spot it and draw the proper Fibonacci retracements. Make your trading strategy as simple as ABCD here: https://t.co/AKmlmaAZBS https://t.co/ukvZfr6BXf
  • BoE’s Tenreyro says evidence on negative rates are “encouraging” Meanwhile, STOXX Europe Banks Index resides at all time lows https://t.co/bBYcLrtXhj
CAD Sank With Crude Oil, Citigroup Earnings Underpin Growth Fears

CAD Sank With Crude Oil, Citigroup Earnings Underpin Growth Fears

2019-07-15 22:30:00
Daniel Dubrovsky, Analyst
Share:

Asia Pacific Market Open Talking Points

  • Canadian Dollar sinks with crude oil as BoC rate cut bets rise
  • Citigroup earnings foreshadow disappointing season for banks
  • NZD/USD eyeing volatility on deviation in New Zealand CPI

Not sure where crude oil prices are heading next? We recently released the third quarter Crude Oil fundamental and technical forecast!

Canadian Dollar Sinks with Crude Oil Prices on US Bank Earnings Concerns

The Canadian Dollar underperformed against its major counterparts as odds of a BoC rate cut by year-end climbed to about 45% on Monday from 33% at the end of last week. Indeed, Canadian front-end government bond yields traded to the downside over these past 24 hours. The cause of these bets seemed to stem from external factors as crude oil prices suffered their worst day in almost two weeks.

Turning our attention towards the US, the S&P 500, while gapping to the upside, spent the rest of its day trading lower as it finished little changed from Friday’s close. Examining the sectors, the index was led lower by financials. More specifically, banks declined over one percent despite Citigroup reporting an EPS beat of $1.83 versus 1.80 expected as second quarter revenue climbed 2% y/y.

However, trading revenue dropped roughly 5% as CFO Mark Mason fretted about trade wars and the Fed stance weighing on client sentiment. At one point, Citigroup shares were down about 2.32% after market open. While the stock pared losses, those of JPMorgan and Wells Fargo, ahead of their earnings report on Tuesday, sunk and stayed lower. This might reflect the markets anticipating similar frets from them ahead.

Moreover, on the chart below, US bond yields declined as markets remain concerned over the outlook from the Federal Reserve and global growth. This works to dampen demand prospects for sentiment-linked crude oil prices. Meanwhile, the commodity is a key revenue for Canada and thus can impact domestic monetary policy. All eyes for the Loonie are on this week’s Canadian CPI report.

Chart of the Day – Sentiment Dragged Down by Bank Shares

CAD Sank With Crude Oil, Citigroup Earnings Underpin Growth Fears

Chart Created in TradingView

Tuesday’s Asia Pacific Trading Session

S&P 500 futures are little changed ahead of Tuesday’s Asia Pacific trading session. This places the focus on key fundamental event risk for currencies ahead. Most notably are the New Zealand CPI report and latest minutes from the RBA rate decision earlier this month. For the former, the RBNZ’s data-dependent approach leaves NZD/USD vulnerable to volatility given a surprise deviation from expectations.

FX Trading Resources

--- Written by Daniel Dubrovsky, Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES