Early indications of European futures point to a flat opening, with hardly any changes. Cash flows are stagnant in anticipation of the ECB meeting, with minimal changes expected as market players position themselves. Wall Street trading in Asia and yesterday ended with strong growth with the continuing de-escalation of tensions between the US and China. Trump has delayed tariffs set for October 1 by 15, and China has responded by calling for more U.S. goods and tariff cuts. Despite the positive outcome, we expect the European markets to concentrate fully on the European Central Bank.
In the FX markets, we are also expecting a “calm before the storm”, although we still have plenty of other data in the economic calendar for today. Given the nature of the event today, we expect them to remain in the background, including the trade war.
In terms of resources, we expect cash flows to remain on hold as oil sank yesterday on news of easing Iran’s sanctions. Gold rose against the backdrop of falling bond yields, despite risk on sentiment yesterday. Today is also the OPEC meeting and we expect minimal impact on oil prices.
Crypto markets still remain so far removed from world events, lingering in a narrow range.
Trader Martin Nikolov