Mild risk-off moves overnight - ANZ

Analysts at ANZ explained that US President Trump caused a mild risk-off move in markets overnight with his comment that he would shut down the Government if necessary, in order to secure funding for his signature project, the border wall with Mexico.

Key Quotes:

"This is seen as further imperilling Trump’s policy agenda, as well as increasing concern around the more important question of raising the debt ceiling. At his rally, Trump also threw in the comment that the US would “probably” terminate the NAFTA agreement “at some point.” In other developments, the firmer-than-expected national and euro area PMI data provided the euro with some support, whilst sagging US home sales in July underscored the weak recovery in residential construction activity.

Market flows remain thin given the holiday period, whilst participants remain wary over the potential for some market-sensitive comments at Jackson Hole this weekend.

Equities gave back some of the previous day’s gains with the DAX off 0.5%, CAC 40 off 0.3% and the S&P 500 down 0.3% at the time of writing.

Bonds firmed slightly with the yield on the US 10-year note easing 4bp to 2.17%.

Oil was stronger with WTI up 1.2% at $48.41/bbl on another decline in US inventories.

Gold is up 0.4% to USD1289.6/oz."