Investing.com - Here are the top five things you need to know in financial markets on Friday, September 8:
1. Dollar at near 3-year low, beaten down by Hurricane effect on Fed
The dollar hit a 32-month low on Friday as concerns over the economic impact of Hurricanes Harvey and Irma along with ongoing tension over North Korea weigh on the currency.
Traders are concerned that the impact from Hurricane Harvey is causing data distortions and these data skews may cause the Federal Reserve to sit on their hands for the rest of 2017.
In addition, Hurricane Irma will undoubtedly add to the turmoil. The historic storm, one the strongest in the last 100 years, claimed at least 14 lives as it hurtled through the Caribbean islands, while hundreds line up for water and fuel in Florida, ahead of landfall this weekend.
The greenback also remained under pressure from the euro as traders poured into the currency on Thursday after the European Central Bank confirmed that it would most likely announce details of its tapering plans in October.
With no major economic reports due stateside on Friday, the U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, dropped 0.33% at 91.19 by 6:00AM ET (10:00GMT).
2. Fedspeak fails to convince markets
Market participants seemed to shrug off hawkish remarks from several Federal Reserve officials after the market close on Thursday.
New York Fed president William Dudley called on the U.S. central bank to continue gradually raising interest rates, as low inflation should rebound.
Meanwhile, Kansas City Fed president Esther George didn’t back down from her hawkish stand, saying that it was time for rate hikes to continue and confirmed that the U.S. central bank had begun to discuss “very explicitly” how to begin the unwinding of the balance sheet.
Also speaking late Thursday, Cleveland Fed chief Loretta Mester reaffirmed her belief that further removal of accommodation via gradual increases in the fed funds rate will be needed.
Markets continued to show their skepticism, putting odds of just 32% on the possibility that the Fed will hike rates in December, according to Investing.com’s Fed Rate Monitor Tool.
Philadelphia Fed Patrick Harker will make remarks at the "New Perspectives on Consumer Behavior in Credit and Payments Markets" Conference at 8:45AM ET (12:45GMT) Friday.
3. Global stocks mostly lower
U.S. futures pointed to a lower open on Friday as investors showed some caution over expectations that North Korea may be planning another missile test on Saturday, raising geopolitical tensions. At 6:01AM ET (10:01GMT), the blue-chip Dow futures lost 67 points, or 0.30%, S&P 500 futures fell 6 points, or 0.26% while the Nasdaq 100 futures traded down 12 points, or 0.12%.
Elsewhere, European bourses showed mixed trade as a stronger euro put the brakes on equities in the region. At 6:01AM ET (10:01GMT), the European benchmark Euro Stoxx 50 dropped less than a point, Germany’s DAX inched up 0.01%, while London's FTSE 100 fell 0.23%.
Earlier, Asian shares also closed mostly lower as a weak reading on Chinese exports dampened sentiment.
4. Oil prices show mixed trade with eyes on Irma
Oil prices showed mixed trade on Friday as U.S. crude production was hit harder by Hurricane Harvey than expected, with the even bigger storm Irma heading for Florida and threatening to cause more disruption to the petroleum industry.
U.S. crude oil futures fell 0.51% to $48.84 at 6:03AM ET (10:03GMT), while Brent oil traded up 0.39% to $54.70.
Investors also looked ahead to the latest gauge on U.S. shale production.
Baker Hughes will release its most recent weekly rig count data later on Friday.
5. Chinese exports miss expectations
China's trade balance data came in at a surplus of $41.99 billion, narrower than the $48.6 billion expected for August.
The world’s second largest saw a solid rise of 5.5% in exports that nevertheless missed expectations for a 6.0% rise.
Imports did provide some good news about the country’s demand as they jumped 13.3%, better than the 10% gain forecast.