London morning: Nasdaq 100 up 1.17% in New York, Nikkei 225 down 1.30%

US stocks ended Monday higher, with the Nasdaq 100 up 1.17% at 29529.34 and the S&P 500 up 0.41% at 7690.73. Tokyo moved the other way on Tuesday, as the Nikkei 225 fell 1.30%.

What happened

The S&P 500 closed at 7690.73 on October 19, a gain of 31.29 points, or 0.41%. The previous close was 7659.44. The reading is stamped 16:00 New York time.

The Nasdaq 100 rose by a wider margin. It finished at 29529.34, up 341.79 points, or 1.17%, from a previous close of 29187.55. The percentage gain in the Nasdaq 100 was almost three times the gain in the S&P 500.

Both US indices therefore start the London morning from higher closing levels than on the session before. European trading has not yet begun at the time of writing, which is 08:00 in London.

Asia and currencies

In Tokyo, the Nikkei 225 stood at 64075.42 at 15:25 local time on Tuesday. That is 841.28 points, or 1.30%, below the previous close of 64916.7. The reading comes shortly before the end of the Tokyo day, so it describes where the index stands at that moment.

The Japanese benchmark and the two US benchmarks therefore moved in different directions. US equities rose in the previous session, while Japanese equities were lower on Tuesday during Asian hours.

In currency markets, EUR/USD stands at 1.1228 at 07:00 UTC. The previous close was 1.1217, so the pair is up 0.0011, or 0.10%. The time stamp is the same moment as 08:00 in London.

Background: the levels and the previous values

A short review of the levels helps place the moves. The S&P 500 moved from 7659.44 to 7690.73 between the two latest closes. The Nasdaq 100 moved from 29187.55 to 29529.34 over the same period. The Nikkei 225 stands at 64075.42 after a previous close of 64916.7. EUR/USD stands at 1.1228 after a previous close of 1.1217.

Each of these changes is measured against the previous close, not against a longer period. A single session does not define a trend, and this report does not draw one. It records the starting point for the day.

The same approach applies to the US housing data due later. The calendar gives a previous value for each release, which allows the next reading to be placed in context once it is published. For Building Permits the previous value is 1.4 M. For Housing Starts it is 1.27 M.

The two releases are for September and are both classed as high impact.

Why it matters

The overnight moves set the backdrop for European trading, which opens later this morning. The Italian Stock Exchange session runs from 09:00 to 17:30 Rome time. Market participants in Europe start the day with US equities higher and Tokyo lower, a mixed picture across regions.

The Nasdaq 100 rose by 1.17%, while the S&P 500 rose by 0.41%. The two indices differ in composition, so the gap records that segments of the US market did not move by the same amount on Monday. The Nikkei 225 decline of 1.30% adds a third data point from a different region.

The euro-dollar rate matters for companies and investors with cross-border exposure, because it sets the conversion between the two currencies. A change of 0.10% is small, and it leaves the pair close to its previous close of 1.1217.

Housing data matters because construction activity is one input into the wider picture of the US economy. Permits and starts are published monthly, and each release adds one more observation to a series that analysts track.

What to watch next

The main scheduled events come from the United States at 12:30 UTC. Two housing indicators for September are due in the same release slot.

The estimate for Building Permits is 1.4 M, against a previous reading of 1.4 M. The estimate for Housing Starts is 1.31 M, against a previous reading of 1.27 M. Neither figure has been published yet.

Both releases give a view of the US housing sector. Permits count approvals for new construction, while starts count projects that have begun. Once the data are out, the actual numbers can be set against the 1.4 M and 1.31 M estimates and against the earlier readings of 1.4 M and 1.27 M.

For markets, the release is a scheduled data point that may be reflected in quotes for US indices and in EUR/USD. The levels in this report are the starting point for that comparison: 7690.73 for the S&P 500, 29529.34 for the Nasdaq 100, 64075.42 for the Nikkei 225 and 1.1228 for EUR/USD.

Later in the day, the Italian session will show how European equity markets trade after the overnight moves in New York and Tokyo. That session closes at 17:30 Rome time. US trading then continues after the housing release, and the next New York reference points will be the closing levels of the S&P 500 and the Nasdaq 100 at 16:00 New York time.