Global stocks tumbled on the last trading day of September, denting quarterly gains as bank stocks led losses on worries over Germany’s largest lender Deutsche Bank. Most Asian indexes receded while European benchmarks opened lower on Friday.
Deutsche Bank shares hit a new record low, shedding nearly 7% following news that about 10 hedge funds doing business with Deutsche Bank have moved part of their listed derivatives holdings to other firms this week. Those are among the biggest clients of the bank, including Izzy Englander’s $34 billion Millennium Partners, and the $14 billion Capula Investment Management.
According to data released by the Federal Statistical Office Destatis, on Friday, German retail sales, adjusted for inflation and seasonal swings, slipped by 0.4% in August from the previous month. However, sales volume adjusted for inflation were still sharply higher than in August 2015 thanks to an extra day of sale.
The U.S. economy expanded at a 1.4 percent annualized rate in the second quarter, compared with a prior estimate of 1.1 percent, Commerce Department figures showed on Thursday. The U.S gross domestic product rose by more than the 1.1% growth rate expected. GDP growth was helped by household consumption which made up for tepid business investment and lackluster demand from overseas. Consumer spending is expected to continue to drive growth in the third quarter, considering recently robust hiring and nascent wage gains.
AUDUSD has fallen out of the support at 0.76140 which coincides with the 23.6% retracement level. The pair has broken below the long-term MA50, which suggests further down moves after the short-term MA20 had been crossed over. Long lower shadows in the current and recent candles show that buyers are buying dips, but this bullish force is anticipated to weaken once the pair hits the 23.6% level again.
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Euro fell to a one-week trough against the USD. The pair lost more than 50 pips from the resistance at 1.12200, after a period of time swinging back and forth around this level. The steep decline brought the currency pair below the 38.2% retracement level at 1.11891. The break lower continues to keep the market in bearish territory, as the price action has broken below both the MA’s which are now placed above the price action.
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EURCAD resumed its downtrend after failing at the resistance zone marked by the two moving averages near the 1.47500 level. Long upper shadows of the recent candles indicate a strong bearish force that has restrained the pair from surging higher. Since RSI is below 50, sellers are foreseen to continue to drive the market lower. The near-term target is at the 23.6% support at 1.46334.
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Silver bounced back from the support at 18.960 again. After having moved past the 20-period MA, the metal is up against the next level of resistance that is the 50-period moving average at 19.265, which may be a tough zone to break through. As can be seen from the stochastics, both %K line and %D line have surpassed the average level and are heading upwards. A breakout beyond the 23.6% level is expected.
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Natural gas bounced back from the major support level at 2.935 after dropping more than 7% from the highest at 3.163 since mid-May, 2015. The steady downtrend has sent the market into the oversold zone which has led to some corrective moves. With the MA20 penetrating the MA50 from above, the commodity is expected to resume its slide and break below the current support zone.
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U.K’s FTSE 100 index created a small gap down on the open today and slid to as low as 6810.00 before rebounding to cover the gap. In spite of recent up-moves, the stochastic index keeps receding coupled with a large distance between the %K line and the %D line. Adding to the signals indicating further downside, the parabolic sar band has just changed its direction and has crossed above the price action.
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