Markets in Asia on risk aversion mood again, after calm North America markets with US away for Memorial Day. Concerns over spike in Spanish bonds to 6.50%, and fresh challenge from Greece anti-austerity Syriza party, continue to weigh on sentiment as various government make contingency plans over Greece exit from euro.

US indices ended a touch lower on Friday. The capital goods, transportation and insurance sectors were under pressure. The S&P 500 (1317.82) remains below its 20d moving average (1347.5 - downward slope) and 50d moving average (1374.8 - downward slope). Wall Street was closed Monday for Memorial Day.

EUR/USD - After a solid bid seen in Asian trading, offers from a broad base of sovereign reserve managers starting at 1.2620 stopped any thought of a low volume rally, in the end falling equities sent EUR/USD lower into early close.

USD/JPY - Exporters have made sure the market is aware of their offers as 80.00 comes into play and officials have made it clear there is little room on the downside.

EUR/GBP, GBP/USD - Sovereign reserve managers sold GBP/USD along with EUR/USD in early trading, but given the minimal volume on to start the week, there has been nothing in the way of price discovery, Tuesday will be different.


Posted by Mike Moloney | Account Executive