Outlook for Overseas Markets: Quiet Trading Anticipated, Focus on U.S. Officials’ Remarks
Situation in Asian Markets
The Tokyo and Asian markets are showing relatively calm movements. The Chinese rate cut met expectations, and the market reaction has been limited. Shanghai stocks briefly rose but have since narrowed their gains, while Hong Kong stocks are under pressure from adjustment selling.
In the commodities market, gold prices are reaching new highs, while oil is in a heavy consolidation state. In the forex market, the USD/JPY is trading in the lower to mid-149 yen range, the EUR/USD is moving from the mid to upper 1.08 range, and the EUR/JPY is slightly weaker, ranging from the mid to lower 162 yen levels. Overall, the levels are being maintained from last week.
Expectations for Overseas Markets
Looking ahead to the overseas markets, relatively quiet trading is expected to continue. A notable economic indicator to be released is the U.S. Leading Economic Index for September. The market expectation is a month-on-month decrease of -0.3%, indicating further weakness from the previous -0.2%.
On the other hand, as data indicating the resilience of the U.S. economy continues to emerge, the view that a 25 basis point rate cut pace will be maintained throughout the year is gaining ground. If stronger indicators are released, the possibility of pausing rate cuts may come into play. However, the leading economic index is unlikely to have a significant impact on the market.
Outlook for Speaking Events
A number of remarks from financial authorities are scheduled in the near future. In Europe, there will be a press conference by Simkus, the Governor of the Bank of Lithuania, along with speeches from officials including ECB President Lagarde. In the U.S., remarks are scheduled from Dallas Fed President Logan, Minneapolis Fed President Kashkari, and Kansas City Fed President Schmidt. However, with the current rate cut expectations stabilizing, a major market reaction is unlikely.
Weekly Outlook
At the start of the week, there is strong demand for the U.S. dollar. Notably, gold (XAU/USD) and cryptocurrencies are showing significant movements, with strong buying against the dollar despite the dollar’s strength. This week, the currency to watch is the Canadian dollar (CAD), where it will be essential to assess strategies alongside the U.S. dollar, gold, and cryptocurrencies.
