Recap of the US session: sentiment reversed overnight - Westpac

Analysts at Westpac offered a recap of the US session.

Key Quotes:

"Global market sentiment: Sentiment reversed overnight, the S&P500 down 0.5%. The ECB was less dovish than expected, US corporate earnings were mixed, and there was news of a terror plot in Brazil.

Interest rates: US 10yr treasury yields initially rose from 1.57% to 1.63% but fell in NY to 1.56%. 2yr yields fell from 0.73% to 0.69%. Market pricing of the Fed funds rate eased, implying a 25% chance of a rate hike in September, a 55% chance by December, and 100% by Oct 2017.

Currencies:  The US dollar index reversed lower. EUR fluctuated between 1.0980 and 1.1060 post-ECB but is little net changed. USD/JPY fell from yesterday afternoon’s high of 107.50 to 105.42 by early London and then consolidated. AUD consolidated recent declines between 0.7476 and 0.7513. After falling to 0.6952 yesterday post-RBNZ, NZD spent the night recovering to 0.7005. AUD/NZD pushed slightly higher, from 1.0720 to 1.0755."