ForexLive European FX news wrap: Yen gains continue, equities in retreat mode

Headlines:

• USD/JPY drops below 155.00 mark for the first time in seven weeks
• USD/JPY Technical Analysis – The sellers remain in control
• Eurozone July flash services PMI 51.9 vs 53.0 expected
• France July flash services PMI 50.7 vs 49.8 expected
• Germany July flash services PMI 52.0 vs. 53.1 expected
• Germany August GfK consumer sentiment -18.4 vs -21.0 expected
• UK July flash services PMI 52.4 vs 52.5 expected
• BOJ rate hike next week reportedly to be a “close call”
• Germany reportedly to hold general elections on 28 September next year

Markets:

• JPY leads, NZD lags on the day
• European equities lower; S&P 500 futures down 0.7%
• US 10-year yields down 0.6 bps to 4.233%
• Gold up 0.3% to $2,417.21
• WTI crude up 1.1% to $76.81
• Bitcoin up 0.9% to $66,414

The Japanese yen continues its good form on the week, as USD/JPY tumbles below the 155.00 mark for the first time in seven weeks. The pair fell to a low of 154.40 in the handover from Asia to Europe, before recovering back to 154.90 during the session. But as we look to US trading now, the pair is down at the lows for the day around 154.10 currently.

That comes despite the dollar largely keeping steadier against the rest of the major currencies bloc.

The other lead gainer today is the Swiss franc, benefiting from a more defensive risk sentiment in markets as well as more sluggish euro area PMI data. USD/CHF was hanging around 0.8910 to start the session before falling to around 0.8860 currently.

Besides that, the dollar is largely steadier with EUR/USD down 0.1% to 1.0845 and GBP/USD flat at 1.2910 on the day.

The antipodeans continue to stay as laggards with AUD/USD down 0.2% to 0.6600 and NZD/USD down 0.3% to 0.5935. That said, both are off their respective lows from earlier in the day.

In the equities space, the selloff in stocks is intensifying ahead of the Wall Street open. European indices are weighed down with French stocks lagging again. Meanwhile, US futures are dragged down after underwhelming earnings from Tesla and Alphabet to some degree. S&P 500 futures are down 0.7% with Nasdaq futures down 1.1% currently.

Coming up later, the Bank of Canada will be announcing their latest policy decision. So, that will be one to watch for the loonie. As for broader markets, the US PMI data for July will be in focus.

This article was written by Justin Low at www.forexlive.com.