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Dollar falters, stocks tick up as markets gird for US election showdown

Financial markets started the week on a careful note, though relocations in currencies stole the spotlight on Monday ahead of a busy week headlined by the U.S. presidential race which is set to come down to the wire.

The week will also offer financiers with global monetary policy catalysts with rate decisions from the Federal Reserve, the Bank of England (BoE), the Reserve Bank of Australia (RBA),. Riksbank and Norges Bank.

China's National Individuals's Congress (NPC) standing committee. satisfies from Nov. 4 to Nov. 8, which will be closely watched for. even more information of a raft of stimulus measures that were. announced just recently.

Trading was thinned in Asia with Japan out for a holiday,. but much of the early action remained in currencies amid a broad fall. in the U.S. dollar.

Versus the yen, the greenback moved 0.75% to 151.82. , while the euro leapt 0.62% to $1.0901.

The Australian dollar increased 0.76%, while China's. yuan got 0.46% in the onshore market.

Dealerships stated the dollar's decline may be linked to a. well-respected survey that revealed Democratic candidate Kamala. Harris taking a surprise 3-point lead in Iowa, thanks mainly to. her appeal with female citizens.

Still, Harris and Republican candidate Donald Trump stay. practically incorporated opinion polls ahead of Tuesday's election and. the winner may not be known for days after voting ends.

At the start of last week, we were pricing about a 48%. chance of a red sweep ... that's fallen to around 36% this. early morning according to Polymarket. So, there's been a significant. reducing around the possibility of a Republican sweep ... the. Democrats have certainly closed the space, said Tony Sycamore, a. market analyst at IG.

As a result of that, you're seeing some of the dollar. ' Trump trade' rally start to come out of the market.

Analysts think Trump's policies on immigration, tax cuts. and tariffs would put upward pressure on inflation, bond yields. and the dollar, while Harris was seen as the connection. candidate.

Cash trading of U.S. Treasuries was closed in Asia due to. the Japan holiday, but futures rallied 10 ticks.

MSCI's broadest index of Asia-Pacific shares outside Japan. increased 0.6%, recuperating from its fall to a. five-week low on Friday.

U.S. stock futures reversed early losses to last trade. higher, with Nasdaq futures increasing 0.42%, while S&P 500. futures gained 0.27%.

EUROSTOXX 50 futures were flat. FTSE futures. eased 0.2%.

CHINA, RATES FOCUS

Besides the U.S. election, China's NPC's standing committee. conference will also be at the top of investors' radar.

Chinese stocks got off to a favorable start on Monday, with. the CSI300 blue-chip index gaining 0.87%, while the. Shanghai Composite Index advanced 0.7%.

Hong Kong's Hang Seng Index rose 0.28%.

Reuters reported that the nation is thinking about approving. the issuance of over 10 trillion yuan ($ 1.4 trillion) in additional. debt in the next few years to revive its delicate economy at the. meeting, a fiscal package which is anticipated to be further. boosted if Trump wins the election.

Amongst the variety of reserve bank conferences this week, the Fed. takes centre phase, with markets favoring a 25-basis-point. rate cut.

Based upon existing data, we see no reason for (the FOMC) to. rush through rate cuts, stated experts at ANZ.

The election and uncertainty over the future financial path. also support arguments for caution in recalibrating monetary. policy.

The BoE satisfies on Thursday and is likewise anticipated to relieve. rates by 25 bps, though its decision has been made complex by a. sharp sell-off in gilts following the Labour federal government's spending plan. last week, which also dragged the pound lower.

Sterling was last 0.56% greater at $1.2993, helped. by a weaker dollar. It had actually fallen 0.3% last week.

In products, oil costs rose more than $1 after OPEC+. said on Sunday it would postpone a planned December output walking by. one month.

Brent futures increased $1.15 per barrel, or 1.57%, to. $ 74.26. U.S. West Texas Intermediate (WTI) crude likewise. got $1.2 a barrel, or 1.73%, to $70.69.

Spot gold ticked 0.12% higher to $2,738.49 an ounce,. however was some distance far from its recent record peak.

(source: Reuters)