ForexLive European FX news wrap: Dollar firms, equities pinned down on Middle East turmoil

<p>Headlines:</p><ul><li><a href="https://www.forexlive.com/news/reminder-it-is-a-us-bond-market-holiday-today-20231009/">Reminder: It is a US bond market holiday today</a></li><li><a href="https://www.forexlive.com/news/stocks-continue-to-be-pinned-lower-so-far-today-20231009/">Stocks continue to be pinned lower so far today</a></li><li><a href="https://www.forexlive.com/centralbank/ecbs-de-guindos-inflation-to-fall-in-the-coming-months-20231009/">ECB's de Guindos: Inflation to fall in the coming months</a></li><li><a href="https://www.forexlive.com/centralbank/ecbs-kazaks-the-phase-of-rapid-rate-hikes-is-already-behind-us-20231009/">ECB's Kazaks: The phase of rapid rate hikes is already behind us</a></li><li><a href="https://www.forexlive.com/news/eurozone-october-sentix-investor-confidence-219-vs-228-expected-20231009/">Eurozone October Sentix investor confidence -21.9 vs -22.8 expected</a></li><li><a href="https://www.forexlive.com/news/germany-august-industrial-production-02-vs-01-mm-expected-20231009/">Germany August industrial production -0.2% vs -0.1% m/m expected</a></li><li><a href="https://www.forexlive.com/news/snb-total-sight-deposits-we-6-october-chf-4799-bn-vs-4763-bn-prior-20231009/">SNB total sight deposits w.e. 6 October CHF 479.9 bn vs 476.3 bn prior</a></li><li><a href="https://www.forexlive.com/news/us-schumer-says-disappointed-by-chinas-lack-of-support-towards-israel-situation-20231009/">US' Schumer says disappointed by China's lack of support towards Israel situation</a></li></ul><p>Markets:</p><ul><li>JPY leads, GBP lags on the day</li><li>European equities lower; S&amp;P 500 futures down 0.7%</li><li>Gold up 1.0% to $1,849.14</li><li>WTI crude up 3.5% to $85.66</li><li>Bitcoin down 1.8% to $27,486</li></ul><p>It was a quiet session for the most part as markets are reeling from the rise in uncertainty in the Middle East, after the surprise attack by Hamas on Israel over the weekend.</p><p>That is leading to plenty of issues in the region, stemming from flight suspensions to gas production halts as tensions escalate.</p><p>Equities are pinned lower as such, with S&amp;P 500 futures down 0.7% and not really much changed since the opening gap lower – mostly just trending sideways.</p><p>In FX, the dollar and yen are the two lead gainers as we see a more typical risk-off mood in broader markets. But the franc and loonie are able to hold their own, with the latter helped out by a jump in oil prices amid the geopolitical conflict. WTI crude is up over 3% to near $86 but off the highs of $87.25 from earlier today.</p><p>EUR/USD is down 0.6% to 1.0525 near the lows with GBP/USD down 0.6% as well to 1.2165 currently. AUD/USD is down 0.4% to 0.6360 but just off the low of 0.6345 earlier in the session.</p><p>In the commodities space, gold is also another beneficiary as it climbs nearly 1% to $1,849 levels.</p><p>As much as the act of war and aggression here is leading to plenty of market uncertainty, there is a feeling that a lot of this is going to be water under the bridge in a few days' time. Even more so as the big picture focus in markets is still on macroeconomics and we do have the US CPI data coming up later this week.</p><p>So, while we are getting some risk-off flows now, it might be swiftly swept aside as human behaviour (and in this case, markets as well) tends to quickly forget and move on to the next big news that will come.</p>

This article was written by Justin Low at www.forexlive.com.