FXstreet.com (Córdoba) - On the first day of the fourth quarter equities worldwide dropped sharply boosting the Dollar and the Yen that rose across the board. Currencies tied to commodities tumbled. Economic data disappoint investors and sent U.S. treasuries to the highest level in four months. Traders now focus on the non farm payroll report.
Stocks fell sharply all over the world. In the U.S. stocks the Dow Jones fell 201 points, the biggest daily decline since July and ended at 9,510. The Nasdaq tumbled 3.06% and the S&P500 lost 2.58%. Treasuries rallied to the upside sending yields to 4-month low.
According to the Forex.com Research Desk: The pattern of worse than expected forward-looking economic data elicited a flight to safety in the NY session. The US initial jobless claims number printed a much worse than anticipated 551K for the latest week, on top of an upwardly revised 534K previously. This led some market participants to shade their NFP estimates a touch lower. We continue to look for a -205K decline tomorrow while the consensus is a bit more optimistic at -175K.
The rise in risk aversion favored the Yen and the Dollar that rose across the board. EUR/USD fell below 1.4600 and is holding near key support at 1.4515. GBP/USD dropped at a moderate pace. The pair remains in a range with support at intra-day low at 1.5920 and resistance at 1.5970. USD/CHF jumped to 1.04525, posting a fresh 2-week high and then pulled back, but the Dollar is holding above 1.0400.
USD/JPY bottomed at 89.40 during the American session. The Dollar recovered later and found resistance at 89.80. Currently the pair is regaining the downside, after breaking below 89.60. The Yen was among the best performers on Thursday rising across the board. Against European currencies is holding near key resistance/support levels. Currencies tied to commodities retreat after yesterday's rally. AUD/USD tumbled more than 130 pips falling below 0.8700.
Crude oil managed to finish the day above $70 a barrel on a volatile session. Gold fell and tested level below $1000 a/oz.