Five Things You Need to Know to Start Your Day

Written by
Lorcan Roche Kelly
Written by

Lorcan Roche Kelly

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Dollar rises on U.S. strength, all eyes on Catalonia's next move, and Saudi Arabia turns to Russia. Here are some of the things people in markets are talking about today.

MAGA

The dollar rose for a second day as positive U.S. economic data supported the case for Federal Reserve tightening before the end of the year. With the White House promising a decision on the next Fed leader in the coming weeks – a rough timeline at best – the stage seems set for further greenback gains. The Australian dollar slipped against the U.S. currency after the former's central bank held rates unchanged, while the euro continues to be held back by the Catalan crisis.

What next?

Spain is facing the biggest threat to its constitutional order since the end of the Franco era in the 1970s following the disruptive secession vote over the weekend. Spanish stocks and bonds are little changed this morning, with investors awaiting the next move from the region's leadership as a day of protest begins. Catalan President Carles Puigdemont yesterday dodged questions on when he would inform the local parliament that voters had opted to secede, a move which would trigger a process leading to a unilateral declaration of independence within 48 hours.

Russian-Saudi rapprochement

OPEC's biggest oil producer is looking at unprecedented deals to acquire oil and gas assets in Russia, according to officials with knowledge of the talks, a move that would deepen ties between Saudi Arabia and the world's other leading energy exporter ahead of the Saudi king's visit to Moscow later this week. This latest development underscores renewed Russian interest in the region, with President Vladimir Putin fast turning into Mr. Middle East as U.S. influence in the region wanes.

Markets gain

Positive economic data pushed U.S. stocks to another record close yesterday, and global stock markets are mostly joining the rally. Overnight, the MSCI Asia Pacific Index gained 0.5 percent, while Japan's Topix index added 0.7 percent as the yen slipped against the dollar. In Europe, the Stoxx 600 Index was broadly unchanged at 5:50 a.m. Eastern Time as Spanish concerns weighed on the regional gauge. S&P 500 futures were 0.1 percent higher, the 10-year Treasury yield was at 2.361 percent and gold edged lower.

Data watch

In the U.K., construction PMI showed a surprise contraction, coming in at 48.1 for September, according to IHS Markit. In the U.S. today, auto sales data for September will be released while President Donald Trump visits Puerto Rico.