Market Roundup
- China Apr industrial output +6.5% y/y vs f’cast +7.1%
- China Apr retail sales +10.7% y/y vs f’cast +10.6%
- China Jan-Apr fixed-asset investment +8.9% y/y vs f’cast +9.1%
- China Jan-April property investment rises 9.3% y/y
- PBOC sets up fintech committee to study impact on monetary policy, financial stability
- China's Xi says Belt and Road needs to reject protectionism
- Japan April corporate goods price index +0.2% m/m, +2.1% y/y, -0.1/+1.8% eyed
- Asian businesses disrupted by cyber-attack, authorities brace for more
- Russia, Saudi Arabia agree to extend oil output cuts until March 2018
- New Zealand Q1 SA real retail sales q/q, +1.5% vs f’cast +0.90%
- New Zealand Q1 SA actual retail sales y/y, +4.6% vs f’cast +4.4%
Economic Data Ahead
- (0315 ET/0715 GMT) Switzerland Apr Producer/Import Price, last +0.1% m/m, +1.3% y/y
- (0400 ET/0800 GMT) Italy Apr Consumer Prices Final, last +0.3% m/m, +1.8% y/y
- (0400 ET/0800 GMT) Italy Apr CPI (EU Norm) Final, 0.8% m/m, 2.0% y/y eyed; last +0.8%, +2.0%
Key Events Ahead
- N/A Norges Bank gov Oystein Olsen attend the hearing before the standing committee on finance and economic affairs of the Storting
- N/A EU foreign affairs council meeting in Brussels
- (0650 ET/1050 GMT) ECB's Daniele Nouy, European Banking Authority's Adam Farkas, Bundesbank's Andreas Dombret speak at a banking conference
- (0845 ET/1245 GMT) ECB's Peter Praet speaks at "Annual PensioPlus Financial Seminar", in Brussels
- (1215 ET/1615 GMT) ECB's Ignazio Angeloni speaks at the "Regulatory vs Business? Banks and growth in Europe" conference
FX Beat
DXY: The dollar declined across the board in the wake of downbeat US retail sales and CPI data. The greenback against a basket of currencies traded flat at 99.21, having hit a high of 99.89 on Thursday, it’s highest since Apr. 21. FxWirePro's Hourly Dollar Strength Index stood at 4.66 (Neutral) by 0500 GMT.
EUR/USD: The euro edged up after rising to a 4-week high earlier as the greenback continued to ease following weaker-than-expected economic data from the U.S. The European currency traded up at 1.0934, having touched a high of 1.0934 earlier, its highest since May. 8. FxWirePro's Hourly Euro Strength Index stood at 47.88 (Neutral) by 0400 GMT. Investors’ attention will remain on U.S. NAHB housing market index and New York empire state manufacturing index, amid a lack of data from the Eurozone docket. Immediate resistance is located at 1.0950, a break above targets 1.1000. On the downside, support is seen at 1.0915 (10-DMA), a break below could drag it lower 1.0900.
USD/JPY: The dollar eased, extending losses for the third straight session as weaker-than-expected U.S. economic data and another missile test by North Korea over the weekend underpinned the perceived safe-haven yen. The pair traded down at 113.54, having touched a low of 113.12 earlier, its lowest since May 8. FxWirePro's Hourly Yen Strength Index stood at 27.40 (Neutral) by 0400 GMT. Investors’ will continue to track broad based market sentiment, ahead of U.S. NAHB housing market index and New York empire state manufacturing index. Immediate resistance is located at 113.74 (5-DMA), a break above targets 114.00. On the downside, support is seen at 113.00, a break below could take it near 112.40 (May 8 Low).
GBP/USD: Sterling rose above the 1.2900 handle as the greenback remains broadly subdued amid weaker treasury yields, in the wake of diminishing bets of a June Fed hike. Sterling trades 0.2 percent up at 1.2908, having hit a low of 1.2849 last week, its lowest since May 4. FxWirePro's Hourly Sterling Strength Index stood at -87.62 (Slightly Bearish) by 0400 GMT. Investors’ attention will remain on the U.S. fundamental drivers, as the UK economic calendar remains absolutely data empty. Immediate resistance is located at 1.2917 (5-DMA), a break above could take it near 1.2987 (May 10 High). On the downside, support is seen at 1.2844 (Previous Session Low), a break below targets 1.2800. Against the euro, the pound traded 0.2 up at 84.66 pence, having hit a low of 84.88 in the prior session.
AUD/USD: The Australian dollar rose after data showed Chinese retail sales rose at an annualized rate of 10.7 percent in April versus expectations of 10.6 percent. However, weaker-than-expected China's industrial production and urban investment growth limited the upside. The Aussie trades 0.2 percent up at 0.7398, having hit a high of 0.7420 on Friday, it’s strongest since May. 8. FxWirePro's Hourly Aussie Strength Index stood at 0.62 (Neutral) by 0400 GMT. Investors will continue to digest mixed Chinese data, ahead of the U.S economic releases. Immediate support is seen at 0.7370 (5-DMA), a break below targets 0.7350. On the upside, resistance is located at 0.7414 (61.8 retracements of 0.7556 and 0.7328), a break above could take it near 0.7441 (50.0% retrace).
NZD/USD: The New Zealand dollar gained following a rally in oil prices combined with solid New Zealand retail sales data and a broadly weaker US dollar, in the wake of downbeat US retail sales and CPI data. The Kiwi trades 0.2 percent up at 0.6872, having touched a low of 0.6817 on Thursday, its weakest since Jun. 03. FxWirePro's Hourly Kiwi Strength Index was at -67.69 (Bearish) by 0500 GMT. Investors’ will continue to track broad based market sentiment, ahead of the U.S. economic data. Immediate resistance is located at 0.6883 (50.0% retracement of 0.6950 and 0.6817), a break above could take it near 0.6899 (38.2% retrace). On the downside, support is seen at 0.6826 (Previous Session Low), a break below could drag it till 0.6800.
Equities Recap
Asian shares rose to a two-year high, shrugging off a missile test by North Korea, cyber-attack and weaker-than-expected U.S. data.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.1 percent.
Tokyo's Nikkei fell 0.2 percent to 19,844.24 points, Australia's S&P/ASX 200 index eased 0.2 percent to 5,824.80 points and South Korea's KOSPI jumped 0.1 percent at 2,288.31 points.
Shanghai composite index edged up 0.2 percent to 3,090.88 points, while CSI300 index was trading 0.4 percent higher at 3,400.94 points.
Hong Kong’s Hang Seng was trading 0.5 percent higher at 25,290.29 points. Taiwan shares added 0.5 percent to 10,036.82 points.
Commodities Recap
Crude oil prices advanced by over 1.5 percent after the Saudi Arabian and Russian energy ministers said in a joint statement that an OPEC-led crude production cut would be extended from the middle of this year until next year. International benchmark Brent crude was trading 1.6 percent up at $51.61 per barrel by 0427 GMT, having hit a high of $51.66 earlier, its strongest since May. 2. U.S. West Texas Intermediate rallied 1.7 percent to $48.61 a barrel, after rising as high as $48.67, its highest since May. 3.
Gold prices rose, extending gains for the third straight session as weaker-than-expected economic data from the U.S. and a missile test by North Korea over the weekend weighed down the dollar. Spot gold was up 0.2 at $1,230.79 per ounce at 0434 GMT, having hit an eight-week low of $1,214.13 an ounce last week. U.S. gold futures were up 0.2 percent at $1,229.90 an ounce.
Treasuries Recap
The 10-year U.S treasury yield stood at 2.329 percent lower by 0.004 bps, while 5-year yield was 0.006 bps down at 1.846 percent.
The Australian government bonds hopped on the first trading day of the week, tracking strength in its United States’ counterpart, after reading a set of weaker-than-expected economic data for the month of April, released late Friday. The yield on the benchmark 10-year Treasury note plunged 5 basis points to 2.59 percent, the yield on 15-year note slumped 5-1/2 basis points to 2.99 percent and the yield on short-term 2-year traded 2 basis points lower at 1.66 percent.
The New Zealand government bonds gained, sending yields 3 basis points lower at the long end of the curve.
