Market Roundup
- Oil declines on plunging fuel demand hit by the pandemic
- Gold hovers near 7-year peak
- PBOC cuts rates on its medium-term funding
- Australia consumer sentiment collapses to a 30-year low on recession fears
Economic Data Ahead
- (0400 ET/0800 GMT) Italy Consumer Price Index (YoY) (Mar)
- (0400 ET/0800 GMT) Italy Consumer Price Index (EU Norm) (MoM) (Mar)
- (0400 ET/0800 GMT) Italy Consumer Price Index (MoM) (Mar)
- (0400 ET/0800 GMT) Italy Consumer Price Index (EU Norm) (YoY) (Mar)
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index rebounded from a 2-week low as investors awaited the release of retail sales and industrial production, which is likely to provide more evidence of the economic costs of lockdowns. On Tuesday, the Fed began a massive new lending programme and the cumulative impact of measures it has taken so far has unleashed a flood of dollars. The greenback against a basket of currencies traded 0.2 percent up at 99.09, having touched a low of 99.82 earlier, its lowest since Mar. 31.
EUR/USD: The euro eased from a 2-week peak, as the greenback rebounded from recent lows after Trump stated that he is close to completing a plan to end the coronavirus shutdown and would speak with governors of all 50 states to authorize them to open their economies in a timely manner. The European currency traded 0.1 percent down at 1.0965, having touched a high of 1.0990 earlier, its highest since April 1. Investors’ attention will remain on a series of economic data from the Eurozone economies, ahead of the U.S. retail sales, industrial production, capacity utilization, NAHB housing market index and business inventories. Immediate resistance is located at 1.0995, a break above targets 1.1040. On the downside, support is seen at 1.0941, a break below could drag it below 1.0920 (5-DMA).
USD/JPY: The dollar declined to a near 1-week low as warnings of a deep recession dampened investor optimism that the slowing spread of the coronavirus could allow businesses to re-open. On Tuesday, the International Monetary Fund predicted that the global economy may shrink by 3 percent in 2020 due to the virus outbreak, in the worst downturn since the Great Depression of the 1930s. The major was trading 0.1 percent down at 107.10, having hit a low of 106.92 earlier, its lowest since Apr. 1. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. retail sales, industrial production, capacity utilization, NAHB housing market index and business inventories. Immediate resistance is located at 107.49, a break above targets 107.77. On the downside, support is seen at 106.75, a break below could take it near at 106.44.
GBP/USD: Sterling edged lower after rising to a 1-month peak in the prior session on signs that lockdown measures may be slowing the spread of the novel coronavirus. The major traded 0.3 percent down at 1.2577, having hit a high of 1.2647 on Tuesday, it’s highest since March 12. Investors’ attention will remain on the geopolitical developments ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2686, a break above could take it near 1.2710. On the downside, support is seen at 1.2524, a break below targets 1.2484 (5-DMA). Against the euro, the pound was trading 0.2 percent down at 87.14 pence, having hit a high of 86.81 on Tuesday, it’s highest since Mar. 10.
AUD/USD: The Australian dollar plunged from a 1-month high following data showing Australian consumer sentiment collapsed in April to a 30-year low. The Melbourne Institute and Westpac Bank index of consumer sentiment plunged 17.7 percent, it's biggest monthly decline since records began 47 years ago. The Aussie trades 1.3 percent down at 0.6357, having hit a high of 0.6444 on Tuesday, it’s highest since Mar. 12. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.6483, a break above could take it near 0.6504. On the downside, support is seen at 0.6347 (5-DMA), a break below targets 0.6325.
Equities Recap
Asian shares slumped after the International Monetary Fund predicted the global economy this year would suffer its steepest downturn since the Great Depression of the 1930s.
MSCI's broadest index of Asia-Pacific shares outside Japan dropped 0.3 percent.
Tokyo's Nikkei fell 0.5 percent to 19,550.09 points, Australia's S&P/ASX 200 index eased 0.4 percent to 5,466.70 points.
Shanghai composite index declined 0.6 percent to 2,811.17 points, while CSI 300 index traded 0.7 percent down at 3,797.36 points
Hong Kong’s Hang Seng traded 0.7 percent lower at 24,260.50 points. Taiwan shares added 1.1 percent to 10,447.21 points.
Commodities Recap
Crude oil prices declined on fears that a record global output cut by producers would not offset plunging fuel demand hit by the coronavirus pandemic. International benchmark Brent crude was trading 1.05 percent lower at $29.74 per barrel by 0528 GMT, having hit a high of $36.37 on Thursday, its highest since March 11. U.S. West Texas Intermediate was trading 0.9 percent down at $20.47 a barrel, after falling as low as $20.00 on Tuesday, its lowest since Apr. 1.
Gold prices consolidated near a more-than 7-year high hit in the previous session, as investor fears of global economic fallout from the coronavirus pandemic heightened, supporting the metal’s safe-haven appeal. Spot gold was trading flat at $1,726.58 per ounce by 0536 GMT, having touched a high of $1,747.72 on Tuesday, its highest since Nov. 2012. U.S. gold futures fell 0.9 percent to $1,752.20 an ounce.
Treasuries Recap
The Japanese government bond prices dipped, with teh benchmark 10-year JGB futures falling 0.20 point to 152.02. In the cash bond market, the 10-year JGB yield rose 1 basis point to 0.020 percent. The 20-year JGB yield rose 0.5 basis point to 0.345 percent, hitting its highest level in about 10 months while the 30-year JGB yield rose 1 basis point to 0.465 percent, a high last seen in late January. The two-year JGB yield was flat at minus 0.170 percent, while the five-year yield rose 1 basis point to minus 0.100 percent.
