Edition:
United Kingdom

Julien Ponthus

FOREX-Dollar under pressure as vaccine hopes get tested

18 Nov 2020

LONDON, Nov 18 The dollar remained under pressure on Wednesday and briefly dropped to its lowest in over a week as tighter economic restrictions across the United States and Europe tested market optimism over vaccine trials.

FOREX-Pressure grows on the dollar as vaccine hopes get tested

18 Nov 2020

LONDON, Nov 18 Pressure increased on Wednesday against the dollar which hit its lowest level in over a week as tighter economic restrictions across the United States and Europe tested market optimism over vaccine trials.

Strongest rally since 2008 fuels hopes of European bank stocks' revival

10 Nov 2020

LONDON/MILAN European bank stocks had their strongest two days since the 2008 financial crisis on Tuesday, as promising vaccine developments prompted their recovery.

Beaten down bank, airline stocks soar on hopes of game-changing vaccine

09 Nov 2020

LONDON Shares of banks, oil and travel companies soared on Monday after Pfizer said its experimental COVID-19 vaccine was more than 90% effective, prompting investors to shift bets to beaten-down cyclical names from stay-at-home winners.

Beaten down bank, airline stocks soar on hopes of game-changing vaccine

09 Nov 2020

LONDON Shares of banks, oil and travel companies soared on Monday after Pfizer said its experimental COVID-19 vaccine was more than 90% effective, prompting investors to shift bets to beaten-down cyclical names from stay-at-home winners.

FOREX-Dollar dips to price Biden win on U.S. election day

03 Nov 2020

* Dollar loses ground, euro rises * Investors brace for volatility after polls close * Analyst warns of election risks * U.S. election results to filter in through Wednesday Asia trade * Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E By Julien Ponthus LONDON, Nov 3 Foreign exchange markets moved on Tuesday towards pricing a victory for U.S. Democratic candidate Joe Biden against President Donald Trump despite warnings that possible post-election disputes could unleash weeks of dollar volatility. The dollar was down 0.44% against a basket of currencies at 93.618 after hitting a month high on Monday. Analysts believe a Biden win would weaken the dollar as the former vice president is expected to spend big on stimulus and to take a freer approach to trade, boosting other currencies at the dollar's expense. They cautioned, however, that uncertainty was very high about the election outcome and that taking positions might prove premature. "I'm more nervous than European markets are today," said Berenberg chief economist Holger Schmieding, warning some investors may be jumping the gun on the issue, particularly if no clear winner emerges swiftly from the polls. The euro extended gains and rose 0.58% against the dollar, crossing the $1.17 bar, while sterling also rose slightly to just below $1.30. Meanwhile, European stock markets were making strong gains while euro zone government yields rose and oil prices extended their rally, exposing how investors were gradually switching from a cautious mood and getting ready to bet on a clear victory for the Democratic candidate. "The markets tempted fate on Tuesday morning, forgetting the lessons of 2016 as they pre-emptively celebrated a Joe Biden victory," warned Connor Campbell, an analyst at Spreadex. Republican Trump, who is trailing Biden in national opinion polls, has criticised mail-in ballots and suggested he would deploy lawyers if states are still counting votes after election day on Tuesday. Overnight gauges of volatility for major currency pairs jumped to multi-month highs ahead of the outcome of the election. Euro/dollar implied volatility surged over 19%, its highest level since the depths of the market mayhem in March, compared with less than 7% on Monday. Other indicators like dollar/yen volatility also jumped. Investors had taken a more cautious approach as the election neared. Rather than outright bets on a particular outcome, many traders had flocked to the safety of dollars so that they were well positioned to take advantage of volatility when results arrive. "Those who haven't hedged yet, but who would feel the pain in case of strong moves, should hedge themselves as soon as possible, as it is getting increasingly expensive," Commerzbank strategist Antje Praefcke wrote to her clients in a morning note prior to the dollar losing ground. "There is only one thing we can do: fasten seatbelts, put the helmets on and await what happens in EUR-USD over the coming days," she said, adding that: "Even riots in the U.S. cannot be excluded, which may cause the market to sell the dollar." It is not unusual in the United States for states to take several days or even weeks to count their votes, and a record surge in mail ballots due to the COVID-19 pandemic could draw out the process further this year. "Under no scenario will Donald Trump be declared a victor on election night," Biden campaign manager Jennifer O'Malley Dillon told reporters. Among other currencies making gains against the dollar, the Aussie rose 0.15% after an initial dip which followed the Reserve Bank of Australia lowering its policy interest rate by 15 basis points to 0.1% and announcing a bond-buying programme. The safe-harbour yen was also slightly higher, up 0.03% at 104.69 per dollar. ======================================================== Currency bid prices at 12:42PM (1242 GMT) Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro/Dollar $1.1702 $1.1638 +0.55% +4.38% +1.1718 +1.1625 Dollar/Yen 104.6900 104.6900 +0.03% -3.59% +104.7800 +104.7200 Euro/Yen 122.50 121.93 +0.47% +0.45% +122.7500 +121.8300 Dollar/Swiss 0.9149 0.9194 -0.48% -5.45% +0.9191 +0.9144 Sterling/Dollar 1.2993 1.2993 +0.02% -2.01% +1.3004 +1.2974 Dollar/Canadian 1.3158 1.3159 +0.01% +1.30% +1.3162 +1.3154 Aussie/Dollar 0.7129 0.7124 +0.08% +1.61% +0.7139 +0.7122 NZ 0.6671 0.6668 +0.09% -0.82% +0.6677 +0.6667 Dollar/Dollar All spots Tokyo spots Europe spots Volatilities Tokyo Forex market info from BOJ (Reporting by Julien Ponthus and Tom Westbrook; Editing by Emelia Sithole-Matarise, Pravin Char and Susan Fenton)

FOREX-Dollar tilts towards Biden win heading into U.S. election

03 Nov 2020

* Dollar loses ground, euro rises * Investors brace for volatility after polls close * Analyst warn of election risks * U.S. election results to filter in through Wednesday Asia trade * Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E By Julien Ponthus LONDON, Nov 3 Foreign exchange markets in Europe tilted on Tuesday towards pricing a victory for U.S. Democratic candidate Joe Biden against President Donald Trump despite warnings that possible post-election disputes could unleash weeks of dollar volatility. The dollar was down 0.4% against a basket of currencies at 93.656 after hitting a month-high on Monday. Analysts believe a Biden win would weaken the dollar as the former vice-president is expected to spend big on stimulus and to take a freer approach to trade, boosting other currencies at the dollar's expense. They cautioned, however, that uncertainty was very high about the election outcome and that taking positions might prove premature. The euro extended gains and rose 0.49% against the dollar to $1.1645 while sterling also went up 0.56% to just below $1.30. Meanwhile, European stock markets were also making strong gains while euro zone government yields rose, another sign investors were gradually switching from a cautious mood and getting ready to bet on a clear victory for the Democratic candidate. "I'm more nervous than European markets are today," said Berenberg chief economist Holger Schmieding, warning some investors may be jumping the gun on the issue, particularly if no clear winner emerged swiftly from the polls. Republican Trump, who is trailing Biden in national opinion polls, has criticised mail-in ballots and suggested he would deploy lawyers if states are still counting votes after Election Day on Tuesday. Overnight gauges of volatility for major currency pairs jumped to multi-month highs ahead of the outcome of the election. Euro/dollar implied volatility surged to 19%, its highest level since the depths of the market mayhem in March, compared with less than 7% on Monday. Other indicators like dollar/yen volatility also surged. Investors had taken a more cautious approach as the election neared. Rather than outright bets on a particular outcome, many traders have flocked to the safety of dollars so that they are well positioned to take advantage of volatility when results arrive. "Those who haven't hedged yet, but who would feel the pain in case of strong moves, should hedge themselves as soon as possible, as it is getting increasingly expensive", Commerzbank strategist Antje Praefcke wrote to her clients in a note. "There is only one thing we can do: fasten seatbelts, put the helmets on and wait what happens in EUR-USD over the coming days," she said, adding that: "Even riots in the U.S. cannot be excluded, which may cause the market to sell the dollar." It is not unusual in the United States for states to take several days or even weeks to count their votes, and a record surge in mail ballots as a result of the COVID-19 pandemic could draw out the process further this year. "Under no scenario will Donald Trump be declared a victor on election night," Biden campaign manager Jennifer O'Malley Dillon told reporters. Among other currencies making gains against the dollar, the Aussie jumped 0.87% higher after an initial dip which followed the Reserve Bank of Australia lowering its policy interest rate by 15 basis points to 0.1% and announcing a bond-buying programme. The safe-harbour yen was also slightly higher, up 0.10% at 104.67 per dollar. ======================================================== Currency bid prices at 10:29AM (1029 GMT) Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro/Dollar $1.1696 $1.1638 +0.50% +4.33% +1.1698 +1.1625 Dollar/Yen 104.6700 104.8100 -0.10% -3.61% +104.8100 +104.4850 Euro/Yen 122.41 121.93 +0.39% +0.38% +122.4700 +121.8300 Dollar/Swiss 0.9159 0.9194 -0.38% -5.34% +0.9191 +0.9155 Sterling/Dollar 1.2989 1.2917 +0.57% -2.05% +1.2995 +1.2911 Dollar/Canadian 1.3147 1.3229 -0.56% +1.17% +1.3234 +1.3138 Aussie/Dollar 0.7119 0.7057 +0.89% +1.48% +0.7132 +0.7028 NZ 0.6673 0.6634 +0.59% -0.82% +0.6683 +0.6622 Dollar/Dollar All spots Tokyo spots Europe spots Volatilities Tokyo Forex market info from BOJ (Reporting by Julien Ponthus and Tom Westbrook; Editing by Emelia Sithole-Matarise and Pravin Char)

FOREX-Caution prevails for dollar heading into U.S. election

03 Nov 2020

* Dollar broadly steady as election risk mutes market moves * Investors brace for volatility after polls close * U.S. election results to filter in through Wednesday Asia trade * Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E By Julien Ponthus LONDON, Nov 3 Caution prevailed on foreign exchange markets on Tuesday in the hours ahead of polls opening in the United States as investors braced for possible post-election disputes that could trigger a burst of volatility for the dollar. Markets are singularly focused on the election result, but rather than outright bets on a particular outcome many traders have flocked to the safety of dollars so that they are well positioned to take advantage of volatility when results arrive. "Those who haven’t hedged yet but who would feel the pain in case of strong moves should hedge themselves as soon as possible, as it is getting increasingly expensive", Commerzbank strategist Antje Praefcke wrote to her clients in a note. "There is only one thing we can do: fasten seatbelts, put the helmets on and wait what happens in EUR-USD over the coming days", she said, adding that "even riots in the U.S. cannot be excluded, which may cause the market to sell the dollar." In early morning European trading, the dollar was down 0.2% against a basket of currencies at 93.831 after hitting a month-high on Monday. The euro rose 0.26% against the dollar to $1.1670 and sterling ticked up to just below $1.30. The safe-harbour yen was also slightly higher, up 0.14% at 104.72 yen per dollar. Analysts said a Biden win could weaken the dollar as he is expected to spend big on stimulus and to take a freer approach to trade - boosting other currencies at the dollar's expense. But with battleground states too close to call and with the prospect of either a Trump victory or an inconclusive result likely to support the dollar, selling was limited. "It's a bit reckless to position ourselves for one outcome of the election... We've positioned ourselves to trade the post (election) volatility", said Stuart Oakley, a London-based executive at Nomura. Beneath the steady spot prices, volatility gauges are soaring in an indication that things could get bumpy as election results arrive through the Asian session on Wednesday. One-week implied volatility for the euro and yen were both above 11%, the highest since the beginning of April. President Donald Trump, who is trailing Democratic rival Joe Biden in national opinion polls, has made attacks on mail-in ballots and suggested he would deploy lawyers if states are still counting votes after Election Day on Tuesday. It is not unusual in the United States for states to take several days or even weeks to count their votes, and a record surge in mail ballots as a result of the coronavirus pandemic could draw out the process further this year. "Under no scenario will Donald Trump be declared a victor on election night," Biden campaign manager Jennifer O'Malley Dillon told reporters. The Aussie ticked 0.1% higher after an initial dip after the Reserve Bank of Australia lowered its policy interest rate by 15 basis points to 0.1% and announced a bond-buying programme, as widely expected. ======================================================== Currency bid prices at 8:01AM (801 GMT) Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro/Dollar $1.1668 $1.1638 +0.27% +4.09% +1.1673 +1.1625 Dollar/Yen 104.5700 104.8100 -0.22% -3.73% +104.8100 +104.4850 Euro/Yen 122.00 121.93 +0.06% +0.04% +122.1300 +121.8300 Dollar/Swiss 0.9179 0.9194 -0.16% -5.14% +0.9191 +0.9177 Sterling/Dollar 1.2938 1.2917 +0.19% -2.42% +1.2946 +1.2911 Dollar/Canadian 1.3217 1.3229 +0.01% +1.75% +1.3234 +1.3208 Aussie/Dollar 0.7066 0.7057 +0.17% +0.76% +0.7071 +0.7028 NZ 0.6646 0.6634 +0.23% -1.17% +0.6654 +0.6622 Dollar/Dollar All spots Tokyo spots Europe spots Volatilities Tokyo Forex market info from BOJ (Reporting by Julien Ponthus and Tom Westbrook; Editing by Christopher Cushing and Emelia Sithole-Matarise)

FOREX-Dollar set for weekly loss amid U.S. stimulus, election uncertainty

23 Oct 2020

LONDON, Oct 23 The dollar lost a little ground against most currencies on Friday after a measured U.S. presidential debate and headed for weekly losses as investors waited for a breakthrough in stimulus talks in Washington and post-Brexit trade negotiations.

FOREX-Dollar stable after U.S. election debate, set for weekly losses

23 Oct 2020

LONDON, Oct 23 The dollar was stable against most currencies on Friday after a measured U.S. presidential debate, but it was headed for weekly losses as investors waited for a breakthrough in stimulus talks in Washington and post-Brexit trade negotiations.

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