Market Roundup
- Russia's Putin predicts global 'chaos' if West hits Syria again
- Former Japan PM Koizumi says embattled Abe may quit in June – magazine
- Japan, China pledge to work on economic ties amid heightened trade tensions
- China c.bank raises 14-day reverse repo by 5 bps, matching March hike on 7-day tenor
- China Q1 central govt-owned firms' profits rise, debt levels ease
- U.S. refrains from labeling China, others as currency manipulators
- S.Korea fin min will seek 'right way' to disclose currency market intervention details
- UK March Visa consumer spending -2.1% y/y, Feb -1.0%; Q1 -1.4%, Q4 -1.3%.
- Speculators' net short U.S. dollar bets at highest since 2011 -CFTC
- Fired FBI director Comey says Trump 'morally unfit' - ABC News interview
- NZ service activity grows at fastest pace in more than a year in March - BNZ survey
Economic Data Ahead
- No major economic data releases
Key Events Ahead
- (0300 ET/0700 GMT) Riksbank executive board meeting-Stockholm
- (0410 ET/0810 GMT) Bank of Japan Deputy Governor Masayoshi Amamiya speaks at an IMF-hosted seminar on Fintech. Looking for any hints on how the central bank will embrace the new technology-Tokyo
- (1200 ET/1600 GMT) Federal Reserve Bank of Minneapolis President Neel Kashkari gives the opening remarks at the "Too Big To Fail" symposium hosted by Howard University-Washington, D.C.
- (1200 ET/1600 GMT) Federal Reserve Bank of Dallas President Robert Kaplan participates in moderated Q&A before the International Economic Forum of the Americas World Strategic Forum-Coral Gables, Florida
- (1230 ET/1630 GMT) German Finance Minister Olaf Scholz speaks at the annual meeting of the Association of German Banks-Berlin
- (1315 ET/1715 GMT) Federal Reserve Bank of Atlanta President Raphael Bostic speaks on the economy and rural market trends before the Shoals Chamber of Commerce-Florence, Alabama
FX Beat
DXY: The dollar index traded within narrow ranges amid concerns at Russia's potential reaction to new sanctions from Washington. The greenback against a basket of currencies trades flat at 89.77, having touched a low of 89.36 on Wednesday, its lowest since Mar. 28. FxWirePro's Hourly Dollar Strength Index stood at 73.86 (Slightly Bullish) by 0500 GMT.
EUR/USD: The euro consolidated, as the market gained some clarity following military strikes on Syria by the United States and its allies at the weekend. The European currency traded 0.05 percent up at 1.2334, having touched a high of 1.2396 on Tuesday, its highest since Mar. 28. FxWirePro's Hourly Euro Strength Index stood at -41.48 (Neutral) by 0400 GMT. Investors’ attention will remain on economic data from the Eurozone economies, ahead of the U.S. retail sales, business inventories and FOMC member Bostic's speech. Immediate resistance is located at 1.2377 (Apr. 10 High), a break above targets 1.2421 (Mar. 28 High). On the downside, support is seen at 1.2319 (21-DMA), a break below could drag it lower 1.2260 (Apr. 6 Low).
USD/JPY: The dollar eased after rising to a near 1-1/2 month high in the previous session, as United States, France, and Britain launched missiles targeting what the Pentagon said were chemical weapons facilities in Syria on Saturday, in retaliation for a suspected chemical attack on April 7. The major was trading 0.1 percent down at 107.24, having hit a high of 107.78 on Friday, its highest since Feb. 21. FxWirePro's Hourly Yen Strength Index stood at -51.48 Bullish) by 0400 GMT. Investors’ will continue to track broad-based market sentiment, ahead of the U.S. retail sales, business inventories and FOMC member Bostic's speech. Immediate resistance is located at 107.90 (Feb. 21 High), a break above targets 108.50. On the downside, support is seen at 106.89 (10-DMA), a break below could take it lower 106.36 (21-DMA).
GBP/USD: Sterling steadied after rallying to a near 2-1/2 month high in the prior session on firm expectations of a rate hike from the Bank of England in May. Investors seem to have ignored downbeat UK consumer spending, which fell 1.4 percent year-on-year in the first three months of 2018 - the worst quarterly performance since the fourth quarter of 2012. The British pound traded 0.1 percent up at 1.4256, having hit a high of 1.4296 on Friday, it’s highest since Jan. 25. FxWirePro's Hourly Sterling Strength Index stood at 79.33 (Slightly Bullish) by 0400 GMT. Investors’ focus will remain on the U.S. fundamental drivers and Fed official speeches, amid a lack of economic data from the UK docket. Immediate resistance is located at 1.4345 (Jan. 25 High), a break above could take it near 1.4380. On the downside, support is seen at 1.4189 (5-DMA), a break below targets 1.4121 (10-DMA). Against the euro, the pound was trading 0.2 percent up at 86.49 pence, having hit a high of 86.27 pence on Friday, it’s highest since July 2017.
AUD/USD: The Australian dollar held firm, after rising to a 1-month high in the prior session, supported by expectations that data from China due on Tuesday would show the economy grew by at least 6.7 percent in the first quarter. The Aussie trades 0.1 percent up at 0.7771, having hit a high of 0.7809 on Friday; it’s highest since Mar. 15. FxWirePro's Hourly Aussie Strength Index stood at 34.54 (Neutral) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7745 (5-DMA), a break below targets 0.7693 (Apr. 10 Low). On the upside, resistance is located at 0.7810 (Apr. 13 high), a break above could take it near 0.7838 (Mar. 8 High).
NZD/USD: The New Zealand dollar eased, having retreated from a near 2-month high hit in the previous session, as market assumed US-led Syria action over for time being. The Kiwi trades 0.05 percent up at 0.7355, having touched a high of 0.7395 on Friday, its highest level since Feb. 19. FxWirePro's Hourly Kiwi Strength Index was at -28.67 (Neutral) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.7409 (Feb. 19 High), a break above could take it near 0.7437 (Feb. 16 High). On the downside, support is seen at 0.7336 (Feb 20 Low), a break below could drag it below 0.7307 (10-DMA).
Equities Recap
Asian shares slumped, while the greenback consolidated within narrow ranges after Russian President Vladimir Putin warned on Sunday that further Western attacks on Syria would bring chaos to world affairs.
MSCI's broadest index of Asia-Pacific shares outside Japan declined 0.4 percent.
Tokyo's Nikkei rose 0.2 percent to 21,811.02 points, Australia's S&P/ASX 200 index gained 0.2 percent to 5,840.50 points and South Korea's KOSPI fell 0.05 percent to 2,454.76 points.
Shanghai composite index eased 1.9 percent to 3,100.20 points, while CSI300 index was trading 2.01 percent down at 3,793.36 points.
Hong Kong’s Hang Seng was trading 1.8 percent lower at 30,261.04 points. Taiwan shares shed 0.1 percent to 10,954.55 points.
Commodities Recap
Crude oil prices declined after rising for four straight sessions, as investors remained cautious following western air strikes in Syria over the weekend, and as American drilling for new production continued to rise. International benchmark Brent crude was trading 0.9 percent down at $71.81 per barrel by 0415 GMT, having hit a high of $73.05 on Wednesday, its highest since Nov. 2014. U.S. West Texas Intermediate was trading 0.7 percent down at $66.75 a barrel, after rising as high as $67.42 on Wednesday, its highest since Nov. 2014.
Gold prices rallied, extending previous session gains, after the U.S.-led missile strikes against Syria at the weekend triggered risk-off market sentiment. Spot gold was up 0.2 percent at $1,347.45 an ounce at 0419 GMT, having hit a high of $1,365.16 an ounce on Wednesday, its highest since Jan. 25. U.S. gold futures rose 0.2 percent to $1,350.60 an ounce.
Treasuries Recap
The 10-year U.S Treasury yield stood at 2.835 percent higher by 0.008 bps, while 5-year yield was 0.005 bps up at 2.682 percent.
The Japanese government bonds remained flat Monday as investors wait to watch the country’s trade balance data for the month of March and the national consumer price inflation (CPI) data for the similar period, scheduled to be released on April 17 and April 19 by 23:50GMT and 23:30GMT respectively. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, hovered around 0.04 percent, the yield on the long-term 30-year note nearly steadied at 0.70 percent and the yield on short-term 2-year remained flat at -0.15 percent.
The Australian bonds slumped across the board on the first trading day of the week as investors moved towards riskier assets following buoyant wine exports data, pushing the benchmark Aussie 10-year Note yield to highest since March 14. The yield on Australia’s benchmark 10-year Note, which moves inversely to its price, rose 2-1/2 basis points to 2.752 percent, the yield on the long-term 30-year Note climbed 1 basis point to 3.333 percent and the yield on short-term 2-year also surged 2 basis points to 2.100 percent.
The New Zealand government bonds closed lower as investors expect to see a rise in the country’s consumer price inflation (CPI) for the first quarter of this year, scheduled to be released on April 18 by 22:45GMT. The yield on New Zealand’s benchmark 10-year Treasury note, which moves inversely to its price, rose 1 basis point to 2.85 percent, the yield on the long-term 20-year note steadied at 3.44 percent and the yield on short-term 2-year too closed 1 basis point higher at 1.96 percent.
