USD/JPY Supported Sub 142.00, Better ISM Stabilizes Risk At The Margins

USD/JPY tracks near 144.15/20 in early Tuesday trade. Lows in the pair were marked late in Asia Pac trade on Monday at 141.70. This level was not breached for the remainder of the Monday session despite multiple tests back below 142.00 as equities remained under pressure.

• A stronger-than-expected set of US ISM data helped stabilize risk and as such USD/JPY had a solid recovery across the latter half of the Monday US session, rising briefly back to 144.89.
• Given the sharp moves, initial resistance is not seen until 146.66, Monday's intraday high. Beyond yesterday's low, key support remains at 140.25, the Dec 28 ‘23 low.
• US equity markets saw the SPX fall 3.0%, Nasdaq down 3.43%, although both indices finished up from earlier session lows.
• US yields were firmer at the front, the 2yr climbed 4bp to 3.92%, with the ISM data helping stabilize sentiment in this space. The 10yr ended at 3.79%, little changed.
• Focus today will be on the local equity backdrop, given yesterday's -12% declines amid the global rout. On the data front, we have June labour (both real and nominal) cash earnings figures. Household spending is also out.