Afternoon Market Update – 28/10/16 – by Jaz Singh

We’ve had data from the Eurozone this morning with all but one of the sentiment indicators coming in better than predicted. Reaction off this news was muted with sterling taking the lead in FX markets. This followed a ruling in Northern Ireland that rejected challenges against the Brexit route; hence one of the major barriers to implementing article 50 in March has been removed. Following this cable has broken out of its range to the downside, looking to target the 1.21 handle. Elsewhere we see USD/JPY remaining above 105.00 following a break of this level yesterday afternoon. The Chinese yuan continued its heavy losses, currently 1.5 per cent down for the month. The dollar index is little unchanged, with the probability of a rate hike in December increasing to 73 percent in the futures market. Oil looks to be heading for its first weekly losses since the preliminary OPEC agreement was announced last month. European equities have rebounded from their early losses this morning following poor earnings data from British Airways parent IAG SA and RBS. We now look to US GDP data as the main risk event this afternoon.