In a market wrap as we enter the Asian shift, analysts at TD Securities explained that the markets remain in a risk-off holding pattern with North American equities posting another sizeable loss (SPX: -1.9%, TSX: -1.2%) following the overnight rout.
“Treasuries gained on a mix of sentiment and data after a miss on US CPI, which saw the long-end rally by nearly 3bps to flatten the curve while Canadian rates outperformed across the front-end and belly.”
“The risk-off tone did little to help the USD, which saw a broad-based decline against G10 FX. SEK (+1.8%) led the advance on stronger-than-expected CPI while the antipodes (NZD: +1.2%, AUD: +0.9%) also outperformed. CAD (+0.2%) underperformed on the crosses amid a sharp drop in crude oil prices (WTI: -3.3%).”
“RBA’s semi-annual Financial Stability Review is released. Housing finance for Aug is expected to pick up a little (+0.3%, “mkt -1%), and continuing the post-macroprudential environment where owner-occupiers are picking up the slack from departing investors.”