Morning Update – 25/09/2017 – by Arjun Lakhanpal

Morning all…Wall St closed mixed with the Dow marginally lower and the S&P just in the green in a quiet finish to the week. In Asia we saw the Nikkei up by a solid o.53% as the JPY weakened on talk that PM Abe will speak today suggesting a new spending programme and possibly calling for a snap election. Talking of elections, election results over the weekend were in focus in the currency markets overnight. The EUR struggled against the USD and GBP after the results of the German election. Despite Angela Merkel winning a fourth term as chancellor as predicted, the 32.8% of the votes Merkel obtained were much lower-than-expected. The SDP party came second with 20.4% of votes. Merkel will now need to form a coalition. NZDUSD, the biggest mover overnight, tumbled almost a full percent after NZ election results failed to deliver a clear mandate to any party. The national party took the lead by 46.6% but did not win enough seats to secure a majority in parliament. The national party will be the first party needing to form a coalition in the New Zealand government, the negotiation process of this is likely to be a few weeks before the government is formed. In the news, Moody’s cut the U.K’s credit rating to Aa2 citing sluggish growth in the U.K and Theresa Mays loss of political power in light of Brexit. GBP however, recovered as the dollar fell. Very little data of note this morning but the main event in Europe will be the German IFO data..Ahead today, there are rumours that PM Abe will announce a snap election at 9am GMT. In focus this week with be Euro-area CPI, where the market excepts a 0.1% increase to 1.6% yoy from 1.5% yoy last month.  Looks like being a quiet one.. Good luck.