The outlook for Sterling remains Gloomy

The currency’s “near-term direction will continue to be driven by the post-election fallout, but the prospects look increasingly gloomy as the possibility of another Tory leadership vacuum enters the picture at precisely the wrong time for the UK,” said Stephen Innes, senior trader at Oanda.

On equity markets, technology firms struggled to recover from the previous day’s sell-off that was sparked by a rout in the sector on Wall Street Friday. Sony and Sharp were well down in Tokyo while Tencent was marginally up in Hong Kong after Monday’s tumble. Samsung was also lower in Seoul.

The losses came after the Nasdaq suffered another slump, extending Friday’s losses, as Apple and Amazon took a beating, with analysts wondering whether the selling is down to profit-taking or the start of a broad retreat after all US indices hit records last week.

Broader markets fared slightly better after Monday’s steep losses. Tokyo ended the morning session at a loss while Shanghai was down 0.1 per cent. Wellington and Manila also eased slightly. But Hong Kong added 0.1 per cent, Sydney gained 0.6 per cent and Seoul gained 0.5 per cent.

Traders are now awaiting the end of the Federal Reserve’s latest policy meeting. While another interest rate hike is widely expected, the bank’s post-meeting statement will be scanned for some forward guidance and clues about future movements.

Also, US Attorney General Jeff Sessions is due to testify Tuesday to the Senate Intelligence Committee as it probes Russian meddling in last year’s election and Moscow’s links to under-fire President Donald Trump.

Attention has focused on Sessions as reports swirl that he may have had more meetings with Russian officials during the campaign last year than the two he has informed authorities of.

The Straits Times via AFP

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Stephen Innes

Stephen Innes

Head of Trading APAC at OANDA
Stephen has over 25 years of experience in the financial markets and currently based in Singapore as the Head of Trading Asia Pacific with OANDA. Stephen's market views focus on the movement of G-10 and ASEAN Currencies. His views appear in Bloomberg, CNBC.Reuters, New York Times WSJ and the Economist. His media appearances include Bloomberg TV & Radio, BBC International, Sky TV, Channel News Asia, ASTRO AWANI and BFM Malaysia. Stephen has an extensive trading experience in Spot and Forward FX, Currency and Interest Rate Futures, Money Market Derivatives and Precious Metals. Before joining OANDA, he worked with organisations like Nat West, Chemical Bank, Garvin Guy Butler, and Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes