Market Brief FX Subdued Ahead of ECB Tomorrow US Indices Rally Across the Board

Market Brief: FX Subdued Ahead of ECB Tomorrow, US Indices Rally Across the Board

FX: The aussie was the strongest major currency and the loonie was the weakest as PM Trudeau called for an election on October 21, introducing an element of political uncertainty into the currency. For more on today’s moves and the outlook for major currencies moving forward, today’s articles on GBP/USD and USD/CHF.
US data: August PMI came in at +1.8% y/y, above expectations of a +1.7% reading. Continued solid inflation readings have caused traders to cut back the odds of a 50bps “double” rate cut from the Fed next week, though a 25bps cut looks like a done deal at this point.
Separately, President Trump met with his advisors to discuss a possible capital gains tax cut.
Tomorrow’s ECB decision will be the week’s marquee event – see our full preview here!
Commodities: Oil fell around -2.5% on the day while gold edged higher after four straight days of selling.

US indices traded higher across the board, with the tech-heavy Nasdaq leading the way.
Utilities (XLU) and Materials (XLB) were the strongest major sector on the day, while REITs (XLRE) brought up the rear.
Stocks on the move:
- A couple of retailers rallied on no company-specific news: J.C. Penney Company (JCP) tacked on 25% today, while embattled Overstock.com (OSTK) gained 7%.
- All was not well for retailers though as GameStop (GME) lost -10% after reporting worse-than-expected earnings.
- RH (RH) rallied 5% on better-than-expected earnings figures.

From time to time, StoneX Financial Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.

City Index is a trading name of StoneX Financial Pty Ltd.

The material provided herein is general in nature and does not take into account your objectives, financial situation or needs.

While every care has been taken in preparing this material, we do not provide any representation or warranty (express or implied) with respect to its completeness or accuracy. This is not an invitation or an offer to invest nor is it a recommendation to buy or sell investments.

StoneX recommends you to seek independent financial and legal advice before making any financial investment decision. Trading CFDs and FX on margin carries a higher level of risk, and may not be suitable for all investors. The possibility exists that you could lose more than your initial investment further CFD investors do not own or have any rights to the underlying assets.

It is important you consider our Financial Services Guide and Product Disclosure Statement (PDS) available at www.cityindex.com/en-au/terms-and-policies/, before deciding to acquire or hold our products. As a part of our market risk management, we may take the opposite side of your trade. Our Target Market Determination (TMD) is also available at www.cityindex.com/en-au/terms-and-policies/.

StoneX Financial Pty Ltd, Suite 28.01, 264 George Street, Sydney, NSW 2000 (ACN 141 774 727, AFSL 345646) is the CFD issuer and our products are traded off exchange.