U.S stock futures rallied, Asian equities bounced and the dollar bounced against the yen, with broader risk appetite improving after a speech by Chinese President Xi Jinping promising to cut import tariffs eased concerns about a trade conflict between the world’s two largest economies. Trade conflict worries ebbed after Xi was seen to have refrained from upping the ante between Washington and Beijing in his first public reaction to the tariff standoff.
Geopolitical risks are weighing amid concerns that U.S.-Russia relations could worsen over the Syria issue’s. President Trump on Monday promised quick, forceful action in response to a suspected chemical weapons attack in Syria, appearing to suggest a potential military response. Trump has castigated Russia for backing Syrian President Bashar al-Assad.
In currency markets USDJPY was 0.3% up at 107.30 from previously fall in the two previous sessions as rhetoric from Chinese and U.S. policymakers had kept markets wary. The euro was steady at 1.2317 after rising about 0.35 percent the previous day, when it touched a six-day high of 1.2331. IT was lifted after European Central Bank President Mario Draghi said on Monday that the slide in stock markets this year has not materially impacted euro zone financial conditions, suggesting policymakers remain calm about the recent market volatility.
In Commodities, Oil markets rose for a second day, with Brent rising above 69 per barrel on hopes a trade dispute between the United States and China, the world’s two biggest crude consumers, may be resolved without greater damage to the global economy. Beyond the trade dispute, oil markets are also concerned about the potential of renewed U.S. sanctions against some significant oil producers.
Forex market economic is starting today with a focus on minor economic data related to the economies of UK and Canada and US. The key economic event for today is US PPI (Producer Price Index) and US P Core PPI. Low volatility and price actions is expected for GBP and US currency pairs.