Forex - GBP/USD gains on advancing U.K. construction report

The pound strengthened against the dollar on Monday after data revealed a pick-up in U.K. construction activity, while the dollar edged lower as markets prepped for the release of the October jobs report later this week.

In U.S. trading on Monday, GBP/USD was trading at 1.5954, up 0.17%, up from a session low of 1.5903 and off from a high of 1.5978.

Cable was likely to find support at 1.5894, the low from Oct. 16, and resistance at 1.6208, last Monday's high.

The pound advanced after data showed that the U.K. construction purchasing managers’ index rose to 59.4 last month, the highest level since September 2007, from 58.9 in September. 

Analysts were expecting an unchanged reading.

Meanwhile in the U.S., date released earlier revealed that U.S. factory orders rose 1.7% in October from September, in line with expectations.

The dollar traded lower, however, as investors weighed possible market reactions to the release of the October U.S. jobs report due out on Friday.

The dollar also moved lower as investors sold the unit for profits in wake of better-than-expected recent manufacturing data.

The Institute of Supply Management released data last week showing that the U.S. PMI rose to 56.4 in October from 56.2 in September, defying expectations for a decline to 55.0.
The numbers sent the greenback strengthening to levels ripe for profit taking on Monday.

The pound, meanwhile, was up against the euro and up against the yen, with EUR/GBP down 0.04% at 0.8468 and GBP/JPY up 0.15% at 157.43.

On Tuesday, the U.K. is to release private sector data on retail sales, an important economic indicator.

In the U.S., the Institute of Supply Management is to release a report on service-sector activity.

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Dollar off highs vs. euro, ECB in focus

The dollar eased back from six-week highs against the euro on Monday after upbeat euro zone manufacturing data, but expectations for a rate cut by the European Central Bank kept the shared currency under pressure.

During European afternoon trade, the euro recovered from six-week lows against the dollar, with EUR/USD easing up 0.10% to 1.3505, after falling as low as 1.3442 earlier.

The euro found support after a report showed that the euro zone manufacturing purchasing managers index’ ticked up to 51.3 in October from a final reading of 51.1 in September, unchanged from a preliminary estimate.

The single currency looked likely to remain under pressure in the run-up the ECB’s monthly meeting on Thursday after data last week showing that euro zone inflation fell to a four year low in October sparked concerns that the bank may cut rates in order to safeguard the fragile economic recovery.

The dollar was almost unchanged near one-and-a-half month highs against the yen, with USD/JPY dipping 0.07% to trade at 98.62. 

Demand for the dollar continued to be underpinned after unexpectedly strong U.S. manufacturing data on Friday added to expectations that the Federal Reserve could start to taper its stimulus program as soon as next month.

Elsewhere, the dollar was close to session lows against the pound, with GBP/USD rising 0.23% to 1.5962. 

Sterling moved higher after data showed that activity in the U.K. construction sector expanded at the fastest rate in six years in October.

The U.K. construction purchasing managers’ index rose to 59.4, the highest level since September 2007, from 58.9 in September. Economists had expected an unchanged reading.

The dollar was almost flat against the Swiss franc, with USD/CHF inching up 0.02% to 0.9122.

The greenback was lower against its Australian and New Zealand counterparts, with AUD/USD advancing 0.75% to 0.9503 and NZD/USD climbing 0.59% to 0.8307. 

Australia’s dollar was higher after data released on Monday showed that retail sales in Australia rose 0.8% in September, beating expectations for a 0.4% increase.

The greenback slid lower against the Canadian dollar, with USD/CAD losing 0.18% to trade at 1.0403.

The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.13% to 80.70.

The U.S. was to release data on factory orders later in the trading day.

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Forex - GBP/USD holds gains after U.K. construction PMI

The pound held gains against the dollar on Monday after data showed that activity in the U.K. construction sector expanded at the fastest rate in six years in October.

GBP/USD hit 1.5978 during European afternoon trade, the session high; the pair subsequently consolidated at 1.5968, gaining 0.27%.

Cable was likely to find support at 1.5902, the session low and a two-week low and resistance at 1.6045, Friday’s high.

Sterling recovered from two-week lows against the dollar after data showed that the U.K. construction purchasing managers’ index rose to 59.4 last month, the highest level since September 2007, from 58.9 in September. 

Economists had expected an unchanged reading.

The report said the housing sector remained the strongest performing area of the sector, while the commercial sector registered the fastest rate of growth since April 2012. Employment levels rose at the steepest rate in six years.

Demand for the dollar continued to be underpinned after unexpectedly strong U.S. manufacturing data on Friday added to expectations that the Federal Reserve could start to taper its stimulus program as soon as next month.

Federal Reserve Bank of Dallas president Richard Fisher said Monday that the recent fiscal standoff in Washington counteracted the role of the Fed’s easy money policies in the economic recovery. The comments came during a speech in Sydney.

Sterling was slightly higher against the euro, with EUR/GBP slipping 0.17% to 0.8456. 

In the euro zone, data released on Monday showed that euro zone manufacturing activity edged higher in October.

The euro zone manufacturing PMI ticked up to 51.3 in October from a final reading of 51.1 in September, unchanged from a preliminary estimate.

The euro looked likely to remain under pressure in the run-up the European Central Bank’s monthly meeting on Thursday after data last week showing that euro zone inflation fell to a four year low in October sparked concerns that the bank may cut rates in order to safeguard the fragile economic recovery.

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Forex - EUR/USD comes off 6-week lows, upside limited

The euro pulled away from six-week lows against the dollar on Monday after encouraging euro zone manufacturing data, but the shared currency failed to build on gains amid growing expectations for a rate cut from the European Central Bank.

EUR/USD recovered from 1.3442, the lowest since September 18, to hit 1.3510 during European afternoon trade, rising 0.14%.

The pair was likely to find support at 1.3441, the session low and resistance at 1.3570, the high of October 15.

The euro found support after data on Monday showed that euro zone manufacturing activity edged higher in October.

The euro zone manufacturing purchasing managers’ index ticked up to 51.3 in October from a final reading of 51.1 in September, unchanged from a preliminary estimate.

Germany’s manufacturing PMI rose to 51.7 last month from 51.1 in September as new orders and production levels rose.

The euro looked likely to remain under pressure in the run-up the ECB’s monthly meeting on Thursday after data last week showing that euro zone inflation fell to a four year low in October sparked concerns that the bank may cut rates in order to safeguard the fragile economic recovery.

Demand for the dollar continued to be underpinned after unexpectedly strong U.S. manufacturing data on Friday added to expectations that the Federal Reserve could start to taper its stimulus program as soon as next month.

Federal Reserve Bank of Dallas president Richard Fisher said Monday that the recent fiscal standoff in Washington counteracted the role of the Fed’s easy money policies in the economic recovery. The comments came during a speech in Sydney.

The euro was slightly higher against the yen, with EUR/JPY easing up 0.11% to 133.31. 

Elsewhere, the euro slipped lower against the pound, with EUR/GBP sliding 0.17% to 0.8456.

Sterling rose to session highs against the dollar and the euro on Monday after data showed that activity in the U.K. construction sector expanded at the fastest rate in six years in October.

The U.K. construction PMI rose to 59.4, the highest level since September 2007, from 58.9 in September. Economists had expected an unchanged reading.

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Dollar steady vs. yen, euro edges higher

The dollar was steady close to six week highs against the yen on Monday, while growing expectations that the European Central Bank may cut rates kept pressure on the euro.

During European morning trade, the euro eased back from six-week lows against the dollar, with EUR/USD edging up 0.13% to 1.3509, after falling as low as 1.3442 earlier.

The single currency posted the largest weekly decline in a year against the dollar last week after data showing that euro zone inflation fell to a four year low in October sparked concerns that the ECB may tighten policy in order to safeguard the recovery.

The euro found support after revised data on Monday showed that the euro zone manufacturing purchasing managers’ index edged up 51.3 in October from a final reading of 51.1 in September. 

Germany’s manufacturing PMI rose to 51.7 last month from 51.1 in September as new orders and production levels rose.

The dollar was almost unchanged near one-and-a-half month highs against the yen, with USD/JPY dipping 0.02% to trade at 98.67. 

Demand for the dollar continued to be underpinned after unexpectedly strong U.S. manufacturing data on Friday added to expectations that the Federal Reserve could start to taper its stimulus program as soon as next month.

Federal Reserve Bank of Dallas president Richard Fisher said Monday that the recent fiscal standoff in Washington counteracted the role of the Fed’s easy money policies in the economic recovery. The comments came during a speech in Sydney.

Elsewhere, the dollar moved lower against the pound, with GBP/USD rising 0.22% to 1.5961. 

Sterling rose to session highs after data showed that activity in the U.K. construction sector expanded at the fastest rate in six years in October.

The U.K. construction PMI rose to 59.4, the highest level since September 2007, from 58.9 in September. Economists had expected an unchanged reading.

The dollar was almost flat against the Swiss franc, with USD/CHF inching down 0.05% to 0.9116.

The greenback was lower against its Australian and New Zealand counterparts, with AUD/USD rising 0.63% to 0.9495 and NZD/USD climbing 0.44% to 0.8295. 

Australia’s dollar was higher after data released on Monday showed that retail sales in Australia rose 0.8% in September, beating expectations for a 0.4% increase.

The greenback slid lower against the Canadian dollar, with USD/CAD losing 0.11% to trade at 1.0411.

The U.S. dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.14% to 80.69.

The U.S. was to release data on factory orders later in the trading day.

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Forex - GBP/USD hits session highs after U.K. construction PMI

The pound recovered from two week lows against the dollar on Monday after data showed that activity in the U.K. construction sector expanded at the fastest rate in six years in October.

GBP/USD hit 1.5966 during European morning trade, the session high; the pair subsequently consolidated at 1.5960, gaining 0.21%.

Cable was likely to find support at 1.5902, the session low and a two-week low and resistance at 1.6045, Friday’s high.

The U.K. construction purchasing managers’ index rose to 59.4, the highest level since September 2007, from 58.9 in September. Economists had expected an unchanged reading.

The report said the housing sector remained the strongest performing area of the sector, while the commercial sector registered the fastest rate of growth since April 2012. Employment levels rose at the steepest rate in six years.

Demand for the dollar continued to be underpinned after unexpectedly strong U.S. manufacturing data on Friday added to expectations that the Federal Reserve could start to taper its stimulus program as soon as next month.

Federal Reserve Bank of Dallas president Richard Fisher said Monday that the recent fiscal standoff in Washington counteracted the role of the Fed’s easy money policies in the economic recovery. The comments came during a speech in Sydney.

Sterling was slightly higher against the euro, with EUR/GBP slipping 0.11% to 0.8462. 

The single currency found support after revised data showed that the euro zone's manufacturing PMI edged up 51.3 in October from a final reading of 51.1 in September. 

Germany’s manufacturing PMI rose to 51.7 last month from 51.1 in September as new orders and production levels rose.

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HSBC Q3 pre-tax profit rises 10% to USD5.06 billion

U.K. banking giant HSBC Holdings reported third quarter profit before tax of USD5.06 billion on Monday, a 10% increase from the same period a year earlier.

The lender also said it was cooperating with regulatory authorities who are investigating potential manipulation of foreign exchange trading.

HSBC shares rose 0.8% in London after the earnings announcement.

Meanwhile, European stock markets remained higher. London’s FTSE 100 gained 0.5%, the EURO STOXX 50 rose 0.3%, France’s CAC 40 added 0.3%, while Germany's DAX inched up 0.3%.

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European stocks higher amid ECB stimulus talk; Dax up 0.29%

European stocks were higher on Monday, supported by growing speculation the European Central Bank may add more stimulus measures, while expectations for the Federal Reserve to soon begin tapering its bond purchases persisted. 

During European morning trade, the EURO STOXX 50 rose 0.32%, France’s CAC 40 gained 0.31%, while Germany’s DAX 30 added 0.29%. 

European equities remained supported after data on Thursday showing that euro zone inflation fell to a four year low in October sparked expectations for further rate cuts by the ECB. 

Eurostat said consumer price inflation in the currency bloc rose 0.7% in October, the slowest pace since November 2009, after rising 1.1% in September. 

Meanwhile, unexpectedly strong U.S. manufacturing data on Friday added to expectations that the Federal Reserve could start to taper its stimulus program as soon as next month.

Federal Reserve Bank of Dallas President Richard Fisher said Monday that the recent fiscal standoff in Washington counteracted the role of the Fed’s easy money policies in the economic recovery. The comments came during a speech in Sydney. 

Financial stocks were mixed, as French lenders BNP Paribas and Societe Generale gained 0.85% and 0.20%, while Germany's Deutsche Bank declined 0.63%. 

Among peripheral lenders, Spanish banks BBVA and Banco Santander both dipped 0.03%, while Italy's Intesa Sanpaolo and Unicredit climbed 0.44% and 0.68% respectively. 

Elsewhere, Dufry AG rallied 1.38% after the operator of duty-free shops reported increased revenue. 

PostNL NV surged 5.90% after the Dutch postal operator raised its income guidance. 

In London, FTSE 100 rose 0.47%, supported by gains in financial stocks. 
HSBC Holdings saw shares advance 0.43% after saying third-quarter pretax profit rose 30% as the lender cut costs. 

Meanwhile, Lloyds Banking gained 0.83% and Barclays jumped 0.91%, while the Royal Bank of Scotland underperformed, plummeted 2.09%. 

Mining stocks added to gains, as Fresnillo rallied 1.33% and Vedanta Resources advanced 1.39%, while rivals Rio Tinto and Antofagasta surged 1.56% and 1.97% respectively. 

On the downside, Ryanair Holdings dove 11.57% after cutting its profit forecast, due to rising competition and a weaker economy in Europe. 

In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.14% rise, S&P 500 futures signaled a 0.18% gain, while the Nasdaq 100 futures indicated a 0.24% increase. 

Also Monday, Markit research group said Spain's manufacturing purchasing managers' index rose to 50.9 in October, from a reading of 50.7 the previous month, in line with expectations. 

Later in the day, the U.S. was to release data on factory orders.

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Gold futures hold steady near 2-week low

Gold futures were little changed near a two-week low on Monday, as ongoing uncertainty over the direction of U.S. monetary policy kept investors in a cautious mood.

Gold prices have largely tracked shifting expectations as to whether the Fed would start tapering its USD85-billion-a-month asset-purchase program by the end of the year.

On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at USD1,314.30 a troy ounce during European morning trade, up 0.1%. 

Prices held in a tight range between USD1,311.00 a troy ounce, the daily low and a session high of USD1,315.80 a troy ounce. The December contract ended 0.79% lower on Friday to settle at USD1,313.20 a troy ounce.

Gold futures were likely to find support at USD1,273.80 a troy ounce, the low from October 17 and resistance at USD1,327.30, the high from November 1.

Federal Reserve Bank of Dallas President Richard Fisher said earlier that the Fed should scale back its stimulus measures as soon as possible.

Speaking at a conference in Sydney on Monday, Fisher said a "fiscally irresponsible" U.S. government counteracted the effects of accommodative Fed policy. 

He also added that he did not expect the central bank's USD85-billion-a-month bond-buying program to increase or go on indefinitely.

“At the earliest possible moment we need to focus on transitioning back to having an interest-rate-driven monetary policy,” Fisher said.

Market players now looked ahead to the release of key U.S. economic data later in the week to help assess the timing for a reduction in the Fed’s bond-purchasing program.

The U.S. is set to release preliminary data on third quarter economic growth on Thursday, while October’s highly-anticipated nonfarm payrolls report is scheduled for Friday.

The central bank sounded more optimistic than anticipated in its assessment of the economy following its policy-setting meeting last week, sparking speculation the Fed could start tapering stimulus at its December meeting.

Gold traders have closely been looking out for U.S. data reports recently to gauge if they will strengthen or weaken the case for the Fed to reduce its bond purchases.

Elsewhere on the Comex, silver for December delivery shed 0.65% to trade at USD21.70 a troy ounce, while copper for December delivery declined 0.65% to trade at USD3.277 a pound.

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