Market Roundup
- Japan Apr exports +7.5% y/y vs forecast +7.8%, last +12.0%
- Japan Apr imports +15.1% y/y vs forecast +14.8%, last +15.8%
- Japan Apr trade surplus (Yen) 481.7 bln vs forecast 520.7 bln, last 614.7 bln
- UK Conservatives' lead halved to 9 pct ahead of election -Survation poll
- The poll put the Conservatives on 43 pct with Labour at 34 pct
- Britain's EU 'no deal' threat is genuine, says Brexit minister Davis
- China imposes duties on "out-of-quota" sugar imports, 45% for 1st year
- On top of existing 50% duty in this fiscal, reduced to 40% in 2nd yr, 35% in 3rd
- China's favoured trade deal in focus at Asian meeting
- US and Pacific Rim countries at odds in heated trade meeting
- New Trump trade rep Lighthizer spars over protectionism in Asia
- PREVIEW-New Zealand to unveil budget surplus as government woos voters
- S&P cuts ratings of 23 Australian small lenders on property risk
- N .Korea says missile tests warhead guidance, ready for deployment
- Germany's upswing to lose some momentum after strong Q1 - FinMin
Economic Data Ahead
- No major economic releases scheduled for the day.
Key Events Ahead
- N/A Eurogroup Finance Ministers' meeting in Brussels
- N/A Norges Bank's Olsen speaks at a seminar held by the local trade and industry association
- (0300 ET/0700 GMT) Meeting of the executive board of the Riksbank
- (1200 ET/1600 GMT) Bundesbank's Jens Weidmann holds a lecture on "Safe? Ten years financial market crisis"
FX Beat
DXY: The dollar rebounded across the board following a mild recovery in the U.S. Treasury yields. The greenback against a basket of currencies traded 0.2 percent up at 97.29, having hit a low of 97.08 on Friday, it’s lowest since Nov. 9. FxWirePro's Hourly Dollar Strength Index stood at -123.14 (Highly Bearish) by 0500 GMT.
EUR/USD: The euro slightly edged down after rising to a 6-month high in the previous session as the greenback rebounded from multi-week lows. The European currency traded 0.1 percent down 1.1193, having touched a high of 1.1211 on Friday, its highest since Nov. 9. FxWirePro's Hourly Euro Strength Index stood at 83.88 (Slightly Bullish) by 0500 GMT. Investors’ attention will remain on U.S. Chicago Fed National Activity Index, as Eurozone's economic calendar remains absolutely data empty. Immediate resistance is located at 1.1211 (Previous Session Low), a break above targets 1.1250. On the downside, support is seen at 1.1132 (78.6% retracement of 1.0839 and 1.1211), a break below could drag it near 1.1069 (61.8% retrace)/1.1000.
USD/JPY: The dollar attempted a solid recovery as investors digested last week’s U.S. political uncertainty over Trump investigation. Investors’ attention now turns towards the Budget plan due to be released tomorrow by the Trump administration. The major traded 0.2 percent up at 111.54, having touched a low of 110.23 on Thursday, its lowest since Apr 25. FxWirePro's Hourly Yen Strength Index stood at 19.87 (Neutral) by 0500 GMT. Investors’ will continue to track sentiment around the U.S. Treasuries, ahead of U.S. Chicago Fed National Activity Index. Immediate resistance is located at 111.81 (38.2% retracement of 114.36 and 110.54), a break above targets 112.29 (50.0% retrace). On the downside, support is seen at 110.50, a break below could take it near 110.23 (May 18 Low).
GBP/USD: Sterling opened with a bearish gap after the UK Prime Minister May and Brexit minister Davis took a tough stand on the Brexit negotiations. Sterling trades 0.2 percent down at 1.3003, having hit a high of 1.3047 on Thursday, its strongest since Sept. 29. FxWirePro's Hourly Sterling Strength Index stood at -8.61 (Neutral) by 0500 GMT. Investors’ attention will remain on U.S fundamental drivers, amid a lack of data from the UK docket. Immediate resistance is located at 1.3047 (May 18 High), a break above could take it over 1.3050. On the downside, support is seen at 1.2951 (5-DMA), a break below targets 1.2900. Against the euro, the pound traded 0.1 percent down at 86.07 pence, having hit a fresh 1-1/2 month low of 86.22 earlier.
AUD/USD: The Australian dollar opened with a bearish gap as the greenback rebounded from 6-month lows. However, the downside was limited as a rally in oil and copper prices supported the bid tone around the major. The Aussie trades 0.2 percent down at 0.7440, having hit a high of 0.7469 on Friday, it’s strongest since May. 3. FxWirePro's Hourly Aussie Strength Index stood at -36.50 (Neutral) by 0500 GMT. Investors will continue to track sentiments around the commodity bloc, ahead of the U.S economic releases and RBA Assistant Gov. Debelle's speech. Immediate support is seen at 0.7415 (61.8% retracement of 0.7328 and 0.7469), a break below targets 0.7398 (50.0% retrace). On the upside, resistance is located at 0.7469 (Previous Session High), a break above could take it near 0.7500.
NZD/USD: The New Zealand dollar advanced, extending gains from the previous session as investors awaited the release of the Fed minutes on Wednesday and New Zealand election year budget release on Thursday. The Kiwi trades 0.2 percent up at 0.6937, hovering towards a high of 0.6949 touched last week, its strongest since May 10. FxWirePro's Hourly Kiwi Strength Index was at -98.70 (Slightly Bearish) by 0500 GMT. Investors’ will continue to track broad based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6949 (May 18 High), a break above could take it near 0.6983 (Apr 4 High). On the downside, support is seen at 0.6899 (61.8% retracements of 0.6817 and 0.6949), a break below could drag it till 0.6868 (38.2% retrace).
Equities Recap
Asian stocks rose, following overnight gains on the Wall Street, while the dollar rebounded following a recovery in the U.S. Treasury yields across the curve.
MSCI's broadest index of Asia-Pacific shares outside Japan rallied 0.9 percent.
Tokyo's Nikkei rose 0.4 percent to 19,680.36 points, Australia's S&P/ASX 200 index gained 0.8 percent to 5,776.30 points and South Korea's KOSPI added 0.4 percent to 2,299.07 points.
Shanghai composite index edged down 0.2 percent to 3,083.11 points, while CSI300 index was trading 0.07 percent up at 3,406.08 points.
Hong Kong’s Hang Seng was trading 0.9 percent lower at 25,412.26 points. Taiwan shares added 0.25 percent to 9,972.11 points.
Commodities Recap
Crude oil prices rose to a fresh 1-month high, boosted by reports that an OPEC-led supply cut may not only be extended until the end of March 2018 but might also be deepened to tighten the market and balance prices. International benchmark Brent crude was trading 0.6 percent up at $54.11 per barrel by 0342 GMT, having hit a high of $54.14 earlier, its strongest since Apr. 19. U.S. West Texas Intermediate gained 0.6 percent to $51.16 a barrel, after rising as high as $51.23, its highest since Apr. 19.
Gold prices declined, reversing some of its previous session gains amid ongoing political worries surrounding U.S. President Donald Trump that are expected to weigh on the dollar. Spot gold trading 0.2 percent lower at $1,253.29 per ounce by 0345 GMT, having slumped from on a near 3-week high on Thursday. U.S. gold futures were up 0.2 percent at $1,255.50 an ounce.
Treasuries Recap
The 10-year U.S treasury yield stood at 2.255 percent higher by 0.011 bps, while 5-year yield was 0.015 bps up at 1.8019 percent.
The Australian bonds traded range-bound at the start of the trading week as investors remain aloof from major trading activity amid signs of possible muted session as market lacks release of any influential data. The yield on the benchmark 10-year Treasury note rose 1/2 basis point to 2.50 percent, the yield on 15-year note hovered around 2.91 percent and the yield on short-term 1-year crawled nearly 1/2 basis point higher at 1.63 percent.
The New Zealand government bonds eased, sending yields 1 basis point higher at the long end of the curve.
