Support
Market rebound and Yen weakens
Analysts suggest that the market's panic reaction to weaker U.S. data was exaggerated, and the likelihood of a recession remains low
with the USD/JPY pair gaining over 2% to rise above 147.5
Yields on 10-year U.S. bonds have risen above 3.91%
US consumer credit data for July, to be released today
Global Market Sentiment
Yesterday's positive market sentiment continued to influence global markets. The VIX index has decreased by 5%, staying near the 23 mark, indicating a decline in market volatility.
Japan Markets and Yen
Japan: Futures are up more than 6%, marking a strong recovery following a historic series of declines not seen since 1987. Concurrently, the yen has weakened, with the USD/JPY pair gaining over 2% to rise above 147.5. Bank of Japan's Uchida stated that the central bank will not raise rates in an unstable market, adding that while a US soft landing is probable, it is not guaranteed. The potential benefits of a weaker yen are supporting export-oriented Japanese stocks.
US Bonds
Yields on 10-year U.S. bonds have risen above 3.91%. Analysts suggest that the market's panic reaction to weaker U.S. data was exaggerated, and the likelihood of a recession remains low.
Oil
Oil prices have increased as the latest API data showed a lower-than-expected inventory change of 180,000 barrels versus a forecast of 850,000 barrels and a previous drop of 4.49 million barrels.
Today's Macro Calendar
Key events include:
- The change in US gas and oil inventories (EIA data at 3:30 PM GMT).
- The Bank of Canada's minutes from its last meeting (6:30 PM GMT).
- US consumer credit data for July (8 PM GMT).
The German industrial production report for July showed slightly stronger than expected results:
- German industrial production came in at -4.1% YoY vs -4.2% expected and -6.67% previously.
