Market Roundup
• Harker gets more hawkish, sees 2 more Fed rate hikes this year.
• China warns U.S. not to open Pandora's Box, unleash trade ills on world.
• U.S. Feb Core PCE Price Index YY, 1.600%, 1.600% forecast, 1.500% previous.
• U.S. Feb PCE Price Index MM, 0.200%, 0.400% previous.
• U.S. Feb PCE Price Index YY, 1.800%, 1.700% previous.
• U.S. w/e Initial Jobless Claims, 215k, 225k forecast, 229k previous, 227k revised.
• U.S. w/e Jobless Claims 4-Wk Avg, 224.50k, 223.75k previous, 225.0k revised.
• U.S. w/e Continued Jobless Claims, 1.871 mln, 1.875 mln forecast, 1.828 mln previous, 1.836 mln revised.
• U.S. Mar Chicago PMI, 57.4, 62.0 forecast, 61.9 previous.
• U.S. Feb Dallas Fed PCE, 1.7%, 2.7% previous, 2.8% revised.
• U.S. Mar U Mich Sentiment Final, 101.4, 102.0 forecast, 102.0 previous.
• U.S. Mar Mich Conditions Final, 121.2, 122.8 previous.
• U.S. Mar Mich 1 Yr Inf Final, 2.8%, 2.9% previous.
• U.S. Feb Consumption, Adjusted MM, 0.200%, 0.200% forecast, 0.200% previous.
• CA Jan GDP MM, -0.1%, 0.1% forecast, 0.1% previous, 0.2% revised.
• CA Feb Producer Prices YY, 1.9%, 2.0% previous, 2.1% revised.
• CA Feb Raw Materials Prices YY, 5.9%, 7.7% previous, 7.8% revised.
• CA Jan Budget, Year-to-Date, C$, -8.38 bln, -8.55 bln previous.
• UK current account deficit narrows, helped by global recovery.
• German jobs bonanza keeps economy swinging into spring.
• China taking first steps to pay for oil in yuan this year –sources.
Looking Ahead - Economic Data (GMT)
• 29 Mar 23:30 JP Mar CPI Core Tokyo YY, 0.9% forecast, 0.9% previous
• 29 Mar 23:30 JP Mar CPI, Overall Tokyo, 1.4% previous
• 29 Mar 23:30 JP Feb Jobs/Applicants Ratio, 1.60 forecast, 1.59 previous
• 29 Mar 23:30 JP Feb Unemployment, 2.6% forecast, 2.4% previous
• 29 Mar 23:50 JP Feb Industrial Output Prelim MM, 5.0% forecast, -6.8% previous
• 29 Mar 23:50 JP Mar IP Forecast 1 Mth Ahead, 9.0% previous
• 29 Mar 23:50 JP Apr IP Forecast 2 Mth Ahead, -2.7% previous
• 30 Mar 05:00 JP Feb Construction Orders YY, 0.9% previous
• 30 Mar 05:00 JP Feb Housing Starts YY, -3.9% forecast, -13.2% previous
• 31 Mar 01:00 CN Mar NBS Non-Mfg PMI, 54.40 previous
• 31 Mar 01:00 CN Mar NBS Manufacturing PMI 50.5 forecast, 50.3 previous
• 1 Apr 23:50 JP Q1 Tankan Big Mf Index, 25 forecast, 25 previous
• 1 Apr 23:50 JP Q1 Tankan Big Mf Outlook DI, 22 forecast, 19 previous
• 1 Apr 23:50 JP Q1 Tankan Big Non-Mf Index, 24 forecast, 20 previous
• 1 Apr 23:50 JP Q1 Tankan All Big Capex Est, 0.6% forecast, 7.4% previous
• 2 Apr 00:30 JP Mar Nikkei Mfg PMI, 53.2 previous
• 2 Apr 01:45 JP Caixin Mfg PMI Final, 51.7 forecast, 51.6 previous
Looking Ahead - Events, Other Releases (GMT)
• No major events scheduled
Currency Summaries
EUR/USD is likely to find support at 1.2238 levels and currently trading at 1.2300 levels. The pair has made session high at 1.2336 and hit lows at 1.2281 levels. Euro was little changed against the dollar on Thursday after data showing German unemployment falling more than expected pointed to continued strength in the euro zone's largest economy, while end-of-quarter investor rebalancing limited broader currency moves. The single currency initially edged lower against the dollar in the early US session, but the currency gained some ground and was trading little changed on the day at 1.2300.The euro has been weighed down recently by comments from some European Central Bank officials suggesting the ECB is in no hurry to wind back its stimulus, given the spectre of low inflation. The dollar meanwhile fell slightly by 0.1 percent to 89.954 against a basket of major currencies. Investors took profits after a hefty rise in the previous session, with traders remaining bearish about the outlook for a currency headed for its fourth consecutive quarter of losses. Global markets were shaken this month when U.S. President Donald Trump moved to impose tariffs on Chinese goods and Beijing threatened similar measures. But fears of a full-blown trade war have eased on hopes negotiations can bring a compromise. Quarter-end and month-end flows have boosted the dollar in recent days as global asset and fund managers rebalanced portfolios. Data showing fourth-quarter U.S. economic growth slowed less than estimated also supported the greenback.
GBP/USD is supported in the range of 1.3980 levels and currently trading at 1.4032 levels. It reached session high at 1.4072 and dropped to session low at 1.4008 levels. The British pound slipped lower against the greenback on Thursday as end-of-quarter flows by investors rebalancing portfolios weighed and economic data failed to impress, though the currency remains on course for its best quarter against the dollar since 2015.Developments in Brexit negotiations viewed as broadly positive for Britain, and growing expectations that the Bank of England could soon raise interest rates have helped the pound rally this year to its highest since the June 2016 vote to leave the European Union. Sterling is up 4 percent versus the dollar this quarter, its best performance since mid-2015. Against the euro it has risen 1.4 percent since January, heading for the best quarter since 2016.On Thursday, end-of-quarter flows by investors overshadowed data showing a narrower UK current account gap and an upgrade in fourth-quarter business investment. Dollar strength and the sense among investors that the British currency may have got ahead of itself have undermined the pound rally this week, and traders say better news is needed next quarter to justify another leg higher. The pound lost 0.2 percent versus the dollar to $1.4050, bringing week-to-date losses to 0.6 percent.
USD/CAD is supported at 1.2840 levels and is trading at 1.2882 levels. It has made session high at 1.2938 and lows at 1.2860 levels. The Canadian dollar edged higher against its U.S. counterpart on Thursday as firmer stock prices offset data showing the domestic economy unexpectedly contracted at the start of the year. Canada’s gross domestic product dipped 0.1 percent in January after a revised 0.2 percent gain in December. Analysts had expected a 0.1 percent increase. Chances of a Bank of Canada interest rate hike in May slipped to 54 percent from above 60 percent before the data, the overnight index swaps market showed. Stock markets rose as investors dusted themselves down after a woeful week for the tech sector, readying for what was set to be the first quarterly drop in global equities in two years. Canada's commodity-linked currency tends be sensitive to stock market performance due to the signal it sends about the strength of the global economy. The price of oil, one of Canada's major exports, slipped as supportive comments from the Organization of the Petroleum Exporting Countries that its output curbs were likely to stay in place for the rest of the year were offset by another rise in U.S. inventories. The Canadian dollar was trading 0.1 percent higher at C$1.2907 to the greenback, or 77.48 U.S. cents. The currency's strongest level of the session was C$1.2890, while it touched its weakest since Friday at C$1.2940.
USD/JPY is supported around 106.00 levels and currently trading at 106.42 levels. It peaked to hit session high at 106.62 and made session lows at 106.22levels. The Japanese yen strengthened against the dollar on Thursday as tensions over North Korea and global trade increased demand for safe heaven Japanese yen. North Korea's leader Kim Jong Un pledged his commitment to denuclearisation and meet U.S. officials, China said on Wednesday after his meeting with President Xi Jinping, who promised China would uphold friendship with its isolated neighbor. Japanese yen, often seen as an alternative investment during times of political and financial uncertainty, gained 0.52 percent against the dollar. U.S. President Donald Trump's tariffs on Chinese goods may not be imposed until early June, administration officials said on Wednesday, with public consultations and potential tariff revisions buying time for negotiations to forestall them. Economic data on Thursday showed jobs market remained solid with first-time filings for unemployment benefits hitting a more than 45-year low last week. Consumer spending rose a second straight month, while the University of Michigan said consumer confidence ended March at its strongest in more than 14 years.
Equities Recap
Merger and acquisition activity gave European shares some relief on Thursday after a tech-led sell-off across global markets earlier in the week, but the STOXX 600 still posted its worst quarter in the last two years.
UK's benchmark FTSE 100 closed up by 0.4 percent, the pan-European FTSEurofirst 300 ended the day up by 0.61 percent, Germany's Dax ended up by 1.5 percent, France’s CAC finished the day up by 0.9 percent.
Wall Street surged on Thursday, bringing an upbeat end to a tumultuous, holiday-shortened week as technology stocks rebounded.
Dow Jones closed up by 1.29 percent, S&P 500 ended up by 1.40 percent, Nasdaq finished the day down by 1.63 percent.
Treasuries Recap
U.S. Treasury yields fell on Thursday, posting a strong finish to a weak first quarter, as investors piled into low-risk government bonds on worries about economic growth and the recent dramatic pullback in stock prices.
The yield on 10-year Treasury notes was down 3.4 basis points at 2.741 percent. It hit a seven-week low of 2.739 percent earlier Thursday.
Commodities Recap
Gold prices slipped on Thursday as the U.S. dollar held its strong gains from the previous session, but simmering tensions over Russia and a potential trade war offered underlying support.
Spot gold dipped 0.1 percent to $1,323.19 per ounce by 1:38 p.m. EDT (1738 GMT), after hitting $1,321.21 its lowest level since March 21.
U.S. gold futures for June delivery settled down $2.70, or 0.2 percent, at $1,327.30 per ounce.
Oil prices rose on Thursday as the equities markets rallied and as market participants weighed a rise in U.S. crude inventories and production against continued OPEC supply curbs.
Prices for the more actively traded June Brent crude futures were up 58 cents to settle at $69.34, while the May contract expiring on Thursday was up 74 cents at $70.27.West Texas Intermediate (WTI) crude futures gained 56 cents to settle at $64.94.
