Friday October 2, 2009 - 00:41:56 GMT
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Reuters - www.reuters.com
Forex Market News - CANADA FX DEBT-C$ ends lower as equities and U.S. data weigh
* C$ ends down at 92.21 U.S. cents
* Tumbling stock markets, economic worries weigh
* Focus on Friday's U.S. payroll numbers
* Bond prices higher with drop in stocks
(Updates to close)
By Frank Pingue and Ka Yan Ng
TORONTO, Oct 1 (Reuters) - The Canadian dollar finished
lower versus the greenback on Thursday as slumping equity
markets and weak U.S. economic data combined to wipe out gains
made earlier in the session.
The turn lower by Canada's dollar came as North American
equities tumbled, ending the session off more than 2 percent,
after U.S. data showed a weak labor market last week and
below-forecast manufacturing sector growth in September.
The weak data increased uncertainty about the nascent
economic recovery. [ID:nN01395512] and saw the greenback
strengthen on renewed safe-haven appeal.
The Canadian unit closed at C$1.0845 to the U.S. dollar, or
92.21 U.S. cents, down from Wednesday's close at C$1.0707 to
the U.S. dollar, or 93.40 U.S. cents.
The data dragged the commodity-linked Canadian unit as low
as C$1.0847 to the U.S. dollar, or 92.19 U.S. cents, after it
reached as high as C$1.0672 to the U.S. dollar, or 93.70 U.S.
"Equity markets are down and weakening through the day and
there is just notable caution today ... with the data that came
out and the data that's expected tomorrow," said David Watt,
senior currency strategist at RBC Capital Markets.
Friday's U.S. jobs report is expected to draw plenty of
attention from currency traders. The report is expected to show
the pace of job losses in September slowed from August, but the
jobless rate is seen rising. ECONUS
No key Canadian economic data comes out until Tuesday when
the Ivey Purchasing Managers Index report for September is due.
That will be followed by September housing starts on Thursday
and the more important jobs data for September on Friday.
G7 finance ministers and central bank chiefs meeting in
Istanbul on Saturday will try to figure out how to put into
practice the lofty promises endorsed by G20 leaders last week,
a senior Canadian finance official said. [ID:N01263572]
BONDS CRUISE HIGHER
Canadian bonds climbed steadily climbed across the curve on
the surprise jump in U.S. weekly jobless claims, while North
American stocks slumped and lifted the appeal of more secure
assets like government debt.
The first trading session of a new quarter may also have
market players assessing the landscape from an economic and
technical point of view.
"I think traders tend to step back and take a more
objective look at the situation. You could say some of the data
this week has disappointed. That momentum that people were
looking for in the economic recovery had a bit of a hiccup this
week," said Sheldon Dong, fixed income analyst at TD Waterhouse
"I think there is also a bit of caution in the stock
The two-year bond CA2YT=RR ended up 12 Canadian cents at
C$99.62 to yield 1.202 percent, while the 10-year bond
CA10YT=RR gained 50 Canadian cents to C$104.10 to yield 3.251
percent. The 30-year bond CA30YT=RR climbed 65 Canadian cents
to C$120.25 to yield 3.809 percent.
(Editing by Rob Wilson)
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