Morning Update – 03/08/16 – by Arjun Lakhanpal

Morning all.. Wall St had a nervy session as oil started to fall again into the close and the S&P closed down 0.64%. Asia has again been too with the Nikkei down 1.55% as oil fell further and USDJPY remained stuck near 101.00. The lack of bounce suggesting good supply still on the rallies. Australia’s ASX 200 was off 1.23 percent, with the heavily-weighted financials sub-index selling off 1.99 percent in late afternoon trade. Japan’s keenly awaited fiscal stimulus proved to be a damp squib, disappointing yen bears who were hopeful for more forceful government spending to revitalize Abenomics.. Apart from USDJPY the USD was stronger across the board overnight versus G10 FX with NZD and JPY the particular currencies underperforming overnight, down ~40bps and ~25bps versus the USD, compared to LDN close yesterday. NZ average hourly earnings released slightly lower than expected, pushing NZDUSD to dip below 0.7200. Crude is unchanged but below $40.00 now and some see another look lower coming on this break. Major Australian banks sold off more than 1.9 percent each, as traders reacted to the Reserve Bank of Australia’s decision on Tuesday to cut its cash rate by another 25 basis points to a record low 1.50 percent. GBP has been quiet overnight as traders now start to focus on the BoE meeting tomorrow. British shop prices declined at the slowest rate since August last year, according to an industry survey published on Wednesday, adding to tentative signs that price pressures may be building since June’s Brexit vote. The British Retail Consortium said shop prices were 1.6 percent lower in July than a year ago, shallower than June’s decline of 2.0 percent. This morning we get Services PMI data for Sweden and across Europe including the UK. We also get EU Retail sales.. Good luck.