Daily Morning Call

From the Floor: Forex seeks direction as equities bleed —#SaxoStrats

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The second quarter is off to a very weak start after equities, particularly the tech sector, threw a collective tantrum, undermining sentiment and triggering a nervous risk aversion across other assets. But the response so far in the forex market is mild, even if the market is left struggling for a catalyst.

  • Tech sector sends global equities reeling
  • Risk off: very little spill-over into FX – mild EM weakness, JPY strength
  • Forex struggling for a catalyst as USD is pulled in two directions
  • Big few days ahead for data, including PMIs and nonfarm payrolls
  • Lots of negative headlines for the likes of Tesla, Amazon, Apple and Intel 
  • Trade tensions and tech rout current drivers for key commodities 
  • Range-bound WTI oil targeting $60/barrel
  • Underlying demand for gold remains firm ahead of $1300/oz