Markets:
- The Australian dollar leads, and the euro lags
- West Texas Intermediate crude oil rose 37 cents to $73.04
- Close the US bond market
- US stocks are closed
- Canada Corporation TSX +0.3%
- Gold fell $3 to $1,942
It was a US and UK holiday, so it was predictably quiet, especially now that Europe is back home.
Selling the dollar was the main theme throughout the day, although it came back somewhat later. The main moves came in the Asian open as the market reacted to the debt ceiling deal and the increase in risky assets.
There is a lot of talk of this move fading and we could see some of that situation creeping up as stock and oil futures give back some of the gains.
In USD/JPY, I had thought we might see some upside given the batch of new treasury issues coming but it pulled back after gapping higher at the open before finding a floor at 104.12 in North American trading and gaining 30 pips. Watch bonds when fixed income markets reopen in the US.
The USD/CAD pair moved during the North American trade (Canadian markets were open) but the pair followed a pullback and then a rebound in oil prices. The OPEC meeting is coming and the leaks have already begun.
Overall, I wouldn’t take anything away from trading a market that is weak due to the holidays, but there will be a lot of fireworks to come as we prepare for the Nonfarm Payrolls report on Friday.