Risk on the mend so far today

Risk trades are faring better on the day, building from the optimistic late bounce in US equities yesterday. Of note, the Nasdaq was down over 2% at one point but salvaged a 0.1% gain by the time the closing bell rang. More details on the wild swings here.

That said, it still doesn’t take away what has been a rather dreadful week for stocks and risk in general. The S&P 500 still looks set to close below its 100-week moving average even if it managed to stave off a 20% drop from the highs – at least for now.

S&P 500 futures are up 0.9% currently with Nasdaq futures up 1.3% on the day. But just a reminder, it is still early and we could see some more wild swings before the week comes to an end.

The flow into bonds is also relaxing with Treasury yields marked higher today. 2-year yields are up 6.4 bps to 2.586% and 10-year yields up 6.9 bps to 2.885% at the moment. In turn, that is helping to relieve some of the downside pressure on yen pairs from yesterday.

USD/JPY is now up 0.5% to near 129.00, though the dollar itself is seen losing some light ground across the board elsewhere.

EUR/USD is up 0.1% to 1.0390 with sellers looking to push below 1.0400, nearing a test of the December 2016 to January 2017 lows around 1.0340-52. Meanwhile, AUD/USD is also up 0.4% to 0.6880 but it isn’t anything technically significant after having dropped for six straight days from its 100-day moving average around 0.7266 last week.