Summary:

• Spanish stocks  thrive on as the Catalan’s government suspended a declaration of independence
• EURUSD eases somewhat its rebound started this week
• Investors await the minutes of the last FOMC meetings

Markets were calm this morning. The biggest moves could be spotted at the Spanish stocks which rebounded on the back of suspending immediate declaration of Catalan independence from Madrid. Moreover, the eurodollar managed to keep above 1.18 handle, though the pair pared part of its gains from this week. Investors also await the release of minutes from the last FOMC meeting looking for clues on possibility of further rate hikes in the US.

Although Catalan leader Carles Puigdemont decided to sign a declaration of independence from Spain he also chose to suspend the results of a referendum for several weeks to allow talks with the government in Madrid. Moreover, a document signed yesterday seems to have little legal credibility. As a result, the euro jumped higher as risks of independence subsided for the time being. Spanish Ibex (SPA35 on xStation5) also surged and it’s currently the strongest index in Europe gaining over 1.5%.

The opening of the cash markets across other European economies was quite listless. Gains are not impressive with the Italian FTSE MIB (ITA40) rising 0.24% (partially it’s a by-effect of the stellar performance seen in Spain). On top of that, the DE30 is inching up 0.07%, the CAC40 (FRA40) is moving down 0.08%, the EuroStoxx50 (EU50) is trading higher 0.18% whilst the British FTSE100 (UK100) is trading flat.

As far as currencies are concerned we note that EURUSD has lost some of its bullish momentum which could be attributed to profit taking and adjusting positions ahead of the release of FOMC minutes. However, the pair holds still above the 1.18 handle. The greenback also weakened against JPY and AUD, the moves didn’t exceed more than 0,2% though. 

Russian is one of the most interesting countries to watch in terms of virtual currencies. On the one side, there were expectations that the former soviet country could regulate the cryptocurrency industry, on the other one there are still many unknowns when and if some legal regulations are implemented. The topic has even drawn Putin’s attention of late who expressed his opinions at a meeting held on Tuesday. The meeting was accompanied by some prominent politicians such as the central bank governor, her deputy and the finance minister. While Putin acknowledged the risks associated with cryptocurrencies, he stressed the importance to not “build up unnecessary barriers” for new technologies. In the meantime, Litecoin is hovering above a key trend line

Wednesday’s data-wise calendar is rather calm, although the release of the FOMC minutes in the evening will be one of the most important events this week. Besides this publication, the OPEC monthly report on oil market is out today. Crude could also react to API data on the US oil inventories – the report will be released on Wednesday due to Columbus Day on Monday. One should look at central bankers speeches as well.