Jan 6, 2015. The JPY is the strongest. The AUD is the weakest.
For the 3rd day in the new trading year, the JPY has been the leader of the pack as NA traders enter for the day. The Pavlovian reaction has been off of equity fears. This time No. Korea's H-bomb test has traders worried. So the "safe haven" trade into the JPY has been what has been happening. The S&P is projected to be down 35 points at the opening. The European major indices are in the red with the Dax -1.68, the Cac down -1.86%. The Euro Stoxx index down -1.67% and the UK FTSE down 1.76%.
Other concerns come out of China as the PBOC continued to weaken the yuan and that too has stock markets skittish on fears things are worse than expected and the central bank knows it. The USDCNH took off last night. The year started with the pair testing the 100 hour MA at 6.5665. The current price is up to 6.71483. Goldman sees more limited downside (for what it is worth). We will see.
The weakest currencies are the NZD and the AUD as trader exit risk.
The greenback is higher but mixed with gains against the commodity/risk currencies (CAD, AUD and NZD - oil is down to $34.73 now after closing just under $36 in trading yesterday).
The ADP is coming up with the expectations of 198K vs 217K. That will be released at 8:15 AM ET. Also at 8:30 AM ET trade data for the US and Canada will be released AND vice chairman of the Fed Stanley Fischer will be interviewed on CNBC. Expect questions about the feds reaction to global concerns. Expect an answer along the lines that the Fed is looking more to the future and not so tied to current market reactions. That has been more of the party line heard from Fed officials so far this year.
