Daily Commentary

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Daily FX Commentary: (Morning Report)

AUD/USD The price plunged to the next significant support at 1.0430, mid-Sep higher platform / 55 day EMA, as losses accelerated on a break below important 1.0500 support. As 4h indicators are breaking below the centrelines, further weakness is seen as likely scenario, with next downside target at 1.0400 zone, previous high / 50% retracement of 1.0165/1.0623 upleg. However, overextended hourly conditions, do not rule out pause in the current downtrend, with 1.0500/20 zone seen limiting the upside and only break here would improve the near-term structure. Res : 1.0450, 1.0484, 1.0500, 1.0520 Sup : 1.0420, 1.0400, 1.0368, 1.0340

USD/CAD The pair extends its near-term corrective rally off 0.9631, 14 Sep low, as break above trendline resistance at 0.9720, triggered fresh extension to 0.9758, where 4h 55 day EMA limited gains, just ahead of key near-term barrier at 0.9772, 13 Sep lower top / 50% of 0.9912/0.9361 downleg and 4h Ichimoku cloud base. Break here to confirm near-term bottom and allow for stronger retracement, with 0.9800, Fib 61.8% and previous lows of 27/30 Apr, seen next. Short-term studies remain supportive, however, bearish larger picture does not see much of recovery, a long as price holds below 0.9800/40 barriers. Res: 0.9758, 0.9772, 0.9800, 0.9833 Sup: 0.9728, 0.9711, 0.9700, 0.9692

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Daily Market Commentary: (Evening Report)

London Market Report

London close: Late rally fizzles
Market Movers

• techMARK 2,132.60 -0.33%
• FTSE 100 5,868.16 -0.43%
• FTSE 250 11,933.70 -1.22%

A late rally which briefly looked like it might see Footsie venture into positive territory for the first time all day was nipped in the bud right at the death.

Equities had a dull but fretful day, which started with concerns over China becoming involved in a trade war with the US and a military war with Japan, and ended with investors partly comforted about developments in Spain, where this morning's government debt auction went about as well as could be expected.

With Spain feeling increased pressure to request assistance, the Treasury was able to issue 12 and 18-month bills for €4.6bn, more than the top end of the €3.5 - €4.5bn target.

18-month bills were issued for €1.02bn (maturity: February 21, 2014) at a yield of 3.072%, lower than the previous 3.335%. 12-month bills were issued for €3.56bn (maturity: September 20, 2013) at a yield of 2.835%, lower than the previous 3.07%.

In the UK, inflation data was in line with forecasts. The Consumer Prices Index (CPI) measure of inflation dropped to 2.5% in August, down from 2.6% in July, helped by falls in the price of clothing and footwear, furniture and household equipment, and domestic gas. The consensus estimate had been for a rise of 2.5%.

Europe Market Report 

Europe close: Spain completes debt sale but stocks slide
- Spain sees successful debt sale
- Car sales weak across EU
- Exhausted Akzo Nobel Chief Executive on sick leave

FTSE 100: -0.43%
Dax 30: -0.76%
Stoxx 600: -0.44%
Cac 40: -1.15%
Ibex 35: -0.74%
FTSE MIB: -2.39%

European markets retreated on Tuesday despite a successful sale of Spanish debt and suggestions the debt-strapped country is prepared to make a formal request for assistance from the European Central Bank.

Spain sold €4.6bn in 12 and 18 month debt at lower interest rates than a similar auction in August, with the one-year notes yielding 2.835% and the 18 month variety going at 3.072%.

The Spanish government has yet to ask its Eurozone peers and the European Central Bank for formal assistance despite multiple banking failures and refinancing difficulties amongst its regional governments.

Deputy Prime Minister, Saenz de Santamaria, indicated in a TV interview that, if the conditions imposed by the ECB were not too onerous, the country may be best served by a rescue.

Meanwhile, the difficulties faced by car manufacturers was thrown into sharp relief by figures from the European Automobile Manufacturers' Association, or ACEA. The trade body said new car registrations fell to 722,483 in August, 8.5% lower than the same month last year.

US Market Report

US open: Investors worried by looming fiscal cliff -NAHB index ahead of forecasts, at 2006 highs -Positive comments out of Goldman Sachs on house-builders -Fed´S Evans backs QE3 completely -Fed´s Fisher argued against QE last week -More Fed speakers scheduled to speak tonight Dow Jones Industrial: -0.06% Nasdaq Comp.: -0.20% S&P 500: -0.24% The major US equity averages are registering slight falls. That as investors wonder aloud whether the recent market run-up was justified or not. Significantly in that regard, in a speech before the opening bell Chicago Fed President Charles Evans has indicated that he fully supports QE3, while adding that the central bank has other options at its disposal should it feel the need [to act again].