After an event driven week including a heavily packed economic release calendar with key monthly manufacturing data being released across continents, coupled with a US FOMC meeting and ECB meeting thrown into the mix, Asian markets have essentially finished where they started. The Australian market showed slim gains of 0.28%, while Japan rounded out the week with a small loss of 0.13%. Hong Kong and Singapore have led the overall region higher with gains close to 2%. The start of the week saw markets run higher with much anticipation for a co ordinated release of further stimulus or quantitative easing measures from the US Fed and the ECB. By Wednesday it was clear that the Fed was still in wait and see mode, which saw regional markets trim the gains seen on Monday and Tuesday. Traders were again left disappointed following Thursday's inaction from the ECB where president Mario Draghi failed to bring out the so called bazooka, with no clear action plan or release of co ordinated stimulus measures. Despite the lack of action, markets have not sold off as much as some traders expected with optimism now that we will see QE3 in September when the Fed meets for the Jackson hole meeting, which has been the venue where the Fed has announced previous QE measures.
Gold remained steady above the $1600 handle during the start of the week, however with no further stimulus announced, gold was sold off as there was no short term need to protect against a weakening dollar in the event of the central banks turning on the money printing presses for now.
In FX, we have seen a grind higher in the USD rounding into the end of week, with the Euro
losing close to a cent, while the resilient AUD and SGD look like ending the week on par.
Traders attention now turns to the US where we will see one of the more important economic data releases of the month, the US non farm payrolls which will detail the employment situation in the states, or more importantly, the unemployment situation.