Asia Pacific Market Open – US GDP, S&P Italy Outlook, Brazil Election, EUR/USD, AUD/USD
- Anti-risk Japanese Yen[1] appreciated amidst broad stock market selloff, NZD[2] trimmed declines
- Euro[3] at risk as banks react to S&P Italy outlook. BRL, emerging markets eye Brazil election
- Active week but quiet Asia open may have Nikkei 225[4] default to risk aversion as AUD[5] falls
We released our 4Q forecasts for equities in the DailyFX Trading Guides page[6]
The anti-risk Japanese Yen gained versus its major counterparts Friday. Broad declines in Asia Pacific benchmark indexes amidst a lack of prominent event risk saw markets default to a risk averse mood[7]. This preceded a gap lower in the S&P 500[8] which despite a temporary climb, still finished the day lower as gains were trimmed. Looking to its record high in September, the S&P 500 stopped short of corrective territory.
US third quarter GDP data, which saw some mixed results[9], failed to spark a meaningful reaction in the US Dollar[10] which pared some of its gains as Wall Street temporarily climbed. The passing of event risk may have led to some corrective performance in stocks as we approached the weekend. This allowed the pro-risk Australian and New Zealand Dollars to trim some of their losses.
As we begin the new week, the Euro could be vulnerable when local markets have a chance to respond to Italy’s outlook being downgraded by S&P to negative form stable[11]. Budget clashes between Italy’s anti-establishment parties and
