Market Roundup
- U.S. judge gives Trump ex-aide Manafort leniency: under 4 years in prison
- Japan sees global growth risks persisting on trade war, China slowdown
- 'Pervasive uncertainty' pushes top central banks to patient stance
- UK PM May to EU: Agree to backstop changes or risk disorderly Brexit
- Amid rising trade tensions with U.S., India wants to extend Iran oil sanctions waiver - sources
- U.S. muni bond funds post $797.5 mln in inflows-Lipper
- Foreign CB US debt holdings +$23.638 bln to $3.465 tln Mar 6 week
- Treasuries +$23.668 bln to $3.070 tln, agencies -288 mln to $323.007 bln
- China Feb Trade Balance USD 4.12 bln, 26.38 bln f’cast, 39.16 bln
- China Feb Exports YY, -20.7%, -4.8% f’cast, 9.1% prev
- China Feb Imports YY, -5.2%, -1.4% f’cast, -1.5% prev
- Japan Q4 GDP Rev QQ Annualised, 1.9%, 1.8% f’cast, 1.4% prev
- Japan Q4 GDP Revised QQ, 0.5%, 0.4% f’cast, 0.3% prev
- Japan Jan All Household Spending YY, 2.0%, -0.4% f’cast, 0.1% prev
- Japan Jan Current Account NSA JPY, 600.4 bln, 179.3 bln f’cast, 452.8 bln
Economic Data Ahead
- (0200 ET/0700 GMT) Germany Jan Industrial Orders MM, 0.5% f’cast, -1.6% prev
- (0245 ET/0745 GMT) France Jan Industrial Output MM, 0.1% f’cast, 0.8% prev
- (0245 ET/0745 GMT) France Jan Trade Balance, EUR, SA, -4.65 bln prev
Key Events Ahead
- (0300 ET/0800 GMT) ECB policymaker Ewald Nowotny speaks at a conference in Prague
- (0800 ET/1300 GMT) Deputy Governor of Irish Central Bank Donnery speaks in Dublin
- (1130 ET/1630 GMT) ECB board member Yves Mersch speaks at a conference in Luxembourg
FX Beat
DXY: The dollar index eased after rising to fresh 2019 highs in the previous session as investors awaited the release of U.S. February payrolls data that could provide further clues on the strength of the U.S. labour market. The greenback against a basket of currencies traded 0.1 percent down at 97.49, having touched a high of 97.71 on Thursday, its highest since December. FxWirePro's Hourly Dollar Strength Index stood at 86.10 (Slightly Bullish) by 0400 GMT.
EUR/USD: The euro consolidated near a 21-month low after the European Central Bank cut its growth forecasts, delayed a possible interest rate increase until 2020 and offered banks a new round of cheap loans to help revive the euro zone economy. The European currency traded 0.05 percent up at 1.1195, having touched a low of 1.1176 the day before, its lowest since June 2017. FxWirePro's Hourly Euro Strength Index stood at -125.80 (Highly Bearish) by 0400 GMT. Investors’ attention will remain on a series of data from the Eurozone economies, ahead of the U.S. building permits, housing starts, nonfarm payroll and unemployment data. Immediate resistance is located at 1.1234 (23.6% retracement of 1.1176 and 1.1496), a break above targets 1.1269 (38.2% retracement). On the downside, support is seen at 1.1150, a break below could drag it till 1.1110.
USD/JPY: The dollar slumped to a 1-week low after data showed China's February dollar-denominated exports fell steeper-than-expected 20.7 percent from a year earlier, far worse than investor expectations, while imports dropped 5.2 percent. The major was trading 0.3 percent down at 111.25, having hit a low of 111.22 earlier, its lowest since February 28. FxWirePro's Hourly Yen Strength Index stood at 161.74 (Highly Bullish) by 0400 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of U.S. building permits, housing starts, nonfarm payroll and unemployment data. Immediate resistance is located at 112.20, a break above targets 112.60 (Dec. 20 High). On the downside, support is seen at 110.93 (Dec. 21 Low), a break below could take it lower at 110.66 (Feb.28 Low).
GBP/USD: Sterling steadied after falling to near a 2-week low in the previous session on news that the Brexit negotiations had hit an impasse. Moreover, an amendment passed by Britain's House of Lords on Wednesday calling for the government to negotiate a customs union with the European Union further added to the uncertainty over PM May's Brexit plans. The major traded 0.1 percent up at 1.3090, having hit a low of 1.3068 on Thursday; it’s lowest since Feb.25. FxWirePro's Hourly Sterling Strength Index stood at 21.63 (Neutral) 0400 GMT. Investors’ attention will remain on UK consumer inflation expectations, and developments surrounding Brexit deal, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.3162 (5-DMA), a break above could take it near 1.3254 (March 4 High). On the downside, support is seen at 1.3050 (Feb. 25 Low), a break below targets 1.3011 (Feb. 20 Low). Against the euro, the pound was trading 0.05 percent down at 85.56 pence, having hit a low of 86.45 on Tuesday, it’s lowest since Feb 26.
AUD/USD: The Australian dollar plunged to a fresh 2-month low, as fresh data showed Chinese exports and imports slumped in February. The major has lost about 0.9 percent so far this week, having slumped 0.7 percent and 0.1 percent in the previous two weeks. The Aussie trades 0.1 percent down at 0.7005, having hit a low of 0.7003 earlier; it’s lowest since Jan. 4. FxWirePro's Hourly Aussie Strength Index stood at -105.93 (Highly Bearish) by 0400 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.6993 (Jan.4 Low), a break below targets 0.6965. On the upside, resistance is located at 0.7059 (5-DMA), a break above could take it near 0.7150 (Feb. 22 High).
NZD/USD: The New Zealand dollar rebounded from a 3-week low touched in the prior session, but was down 0.6 percent and on track for its third straight weekly loss. The Kiwi trades 0.1 percent up at 0.6761, having touched a low of 0.6744 the day before, its lowest level Feb. 13. FxWirePro's Hourly Kiwi Strength Index was at 14.79 (Neutral) by 0400 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6792 (March 7 High), a break above could take it near 0.6853 (Feb. 22 High). On the downside, support is seen at 0.6719 (Feb. 12 Low), a break below could drag it below 0.6706 (Feb. 22 Low).
Equities Recap
Asian shares tumbled to a 2-week trough after unexpectedly weak export data from China heightened market fears about a global economic slowdown.
MSCI's broadest index of Asia-Pacific shares outside Japan plunged 1.1 percent.
Tokyo's Nikkei declined 2.01 percent to 21,025.56 points, Australia's S&P/ASX 200 index slumped 0.9 percent to 6,203.80 points and South Korea's KOSPI eased 1.2 percent to 2,140.00 points.
Shanghai composite index fell 3.3 percent to 3,002.60 points, while CSI300 index traded 3.1 percent down at 3,689.75 points.
Hong Kong’s Hang Seng traded 1.8 percent lower at 28,284.54 points. Taiwan shares shed 0.7 percent to 10,241.75 points.
Commodities Recap
Crude oil prices declined amid growing investor concerns over the global economy, after the European Central Bank warned investors of continuous weakness in the euro zone economy. International benchmark Brent crude was trading 0.2 percent down at $65.83 per barrel by 0426 GMT, having hit a high of $66.97 on Thursday, its highest since March 1. U.S. West Texas Intermediate was trading 0.3 percent lower at $56.24 a barrel, after rising as high as $57.85 last week, its highest since the November 16.
Gold prices steadied as risk appetite faded after the European Central Bank cut its growth forecasts and launched an emergency round of policy stimulus. Spot gold was trading 0.2 percet up at $1,287.31 per ounce as of 0432 GMT, having touched a low of $1,280.57 on Thursday, its lowest since January 25. U.S. gold futures were also flat at $1,286 an ounce.
Treasuries Recap
The yield on the benchmark 10-year JGB note, which moves inversely to its price, slumped 3 basis points to -0.029 percent, the yield on the long-term 30-year plunged nearly 4 basis points to 0.590 percent and the yield on short-term 2-year suffered 14-1/2 basis points to -0.144 percent.
The yield on Australia’s benchmark 10-year note, which moves inversely to its price, plunged nearly 5-1/2 basis points to 2.030 percent, the yield on the long-term 30-year bond slumped nearly 4-1/2 basis points to trade at 2.605 percent and the yield on short-term 2-year traded tad lower at 1.674 percent.
The Canadian government bond prices were higher across the yield curve. The two-year rose 10 Canadian cents to yield 1.628 percent and the 10-year climbed 52 Canadian cents to yield 1.766 percent. The two-year yield touched its lowest intraday since December 2017 at 1.620 percent.
