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The USD took its steepest dive of the year in August, losing over 2% against other major currencies as markets anticipated the US Federal Reserve might cut interest rates amid signs of a slowing economy, Reuters reports. The greenback nevertheless rose to a two-week high yesterday, as markets braced for a series of key economic reports, including Friday’s U.S. Jobs report, which pundits think will help set the tone for the US Federal Reserve’s next three interest rate meetings.
The USD’s fall eased pressures on most global markets, particularly in Japan, offering breathing space for (emerging) markets to cut rates and become more sensitive to domestic growth issues, Reuters suggests.
Currencies in Latin America gained no ground on the greenback in August thanks to economic troubles and shaky commodity prices.
The weaker USD positioned the EUR and GBP as the top-performing major currencies this year, with the GBP above USD 1.30, up over 25% since its record lows, and the EUR above USD 1.10. Sweden’s SEK was the best-performing major currency, rallying 4% in August.
THE MARKETS THIS MORNING-
Asian markets fell sharply in early trading this morning, mirroring yesterday’s tech-led selloff on Wall Street. Japan’s Nikkei and Taiwan’s Taiex were each down more than 3%, while Australia’s ASX 200 was off 1.7%. Benchmark indexes in China have so-far been least impacted: The Shanghai Composite is down 0.6% and the Hang Seng is off 1.5%.
Futures suggest we can expect more of the same in Europe as well as on Wall Street and Bay Street when trading opens there later today.
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TASI |
12,180 |
+0.1% (YTD: +1.8%) |
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MSCI Tadawul 30 |
1,517 |
+0.1% (YTD: -2.2%) |
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NomuC |
26,045 |
-0.6% (YTD: +6.2%) |
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USD : SAR (SAMA) |
USD 3.75 Sell |
USD 3.75 Buy |
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Interest rates |
6.5% repo |
5.5% reverse repo |
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EGX30 |
31,018 |
+0.9% (YTD: +24.6%) |
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ADX |
9,379 |
+0.2% (YTD: -2.1%) |
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DFM |
4,370 |
+0.3% (YTD: +7.6%) |
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S&P 500 |
5,529 |
-2.1% (YTD: +15.9%) |
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FTSE 100 |
8,198 |
-0.8% (YTD: +7.3%) |
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Euro Stoxx 50 |
4,913 |
-1.2% (YTD: +8.7%) |
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Brent crude |
73.75 |
4.9% |
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Natural gas (Nymex) |
2.2 |
0.0% |
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Gold |
2,493 |
0.01% |
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BTC |
USD 58,149.10 |
-1.5% (YTD: +37.4%) |
THE CLOSING BELL: TADAWUL-
The TASI rose 0.1% yesterday on turnover of SAR 7.3 bn. The index is up 1.8% YTD.
In the green: Sfico (+9.9%), Al Baha (+8.3%) and Savola Group (+6.7%).
In the red: East Pipes (-5%), Zamil Industrial (-4.7%) and Red Sea International (-3.1%).
THE CLOSING BELL: NOMU-
The NomuC fell 0.6% yesterday on turnover of SAR 36.9 mn. The index is up 6.2% YTD.
In the green: Knowledge Tower (+8.6%), View United (+6.8%) and Naas Petrol (+6.4%).
In the red: Al Razi (-9.2%), Quara (-7.6%) and Leaf Global (-5.1%)
CORPORATE ACTIONS-
Tadawul-listed City Cement’s BoD has approved the establishment of a SAR 500k wholly-owned mining services subsidiary in Riyadh, it said in a disclosure to Tadawul. The move is pending approvals and licenses. No further details were disclosed.
