Market Roundup
- EUR/USD -0.1%, USD/JPY +0.2%, GBP/USD +0.2%, DXY +0.05%
- DAX -0.3%, FTSE -0.2%, Brent +0.8%, Copper -0.8%
- Strong U.S 10s yield reversal Friday from 2.2690 but stalls at 2.3950 today
- EUR/USD holds near 1-month 1.0570 low as French election nerves grow
- DXY extends Friday gains to new 101.34 top, highest since Mar 15
- EZ Apr SENTIX Index 23.9 vs previous 20.7. 21.0 forecast
- SNB domestic deposits rise to 476.198bln w/e Apr 7 vs the previous 475.149bln
- EU should consider billion-euro investment boost for Greece - Austrian finmin
- Greek PM says debt relief is a condition for more austerity
- Fillon, Melenchon seek last-gasp boost in French presidential election
- Czech central bank governor sees rate hikes turn of 2017/2018 -Hospodarske Noviny
- Czech crown at 26.52 vs euro, strongest since FX cap exit
Economic Data Ahead
- (0815 ET/1215 GMT) Canadian Mortgage and Housing Corp will report housing starts for the month of March. The indicator stood at a seasonally adjusted annualized rate of 216,000 in the previous month.
- (1000 ET/1400 GMT) The Fed releases its labor market conditions index (LMCI) for the month of March. The indicator posted a rise of 1.3 in the previous month.
- (1745 ET/2145 GMT) The Statistics New Zealand will release Electronic Card Retail Sales figures for the month of March. The indicator posted a gain of 2.6 percent in the previous month.
Key Events Ahead
- (1245 ET/1645 GMT) FedTrade 30-yr Ginnie Mae securities (max $850 mn)
- (1600/2000) Federal Reserve Chair Janet Yellen will participate in a discussion with Gerald R. Ford School Dean, Susan Collins, at the "Gerald R. Ford School of Public Policy: Policy Talk Series," in Ann Arbor, Michigan.
- (1800 ET/2200 GMT) Fed Chair Yellen speaks at the University of Michigan and takes questions from students and Twitter.
FX Beat
DXY: The dollar gained across the board as investors await a speech by Federal Reserve Chair Janet Yellen for further insights on the strength of the economy and interest rate outlook. The dollar against a basket of currencies traded 0.1 percent up at 101.22, having hit a high of 100.34 earlier, its highest since Mar. 15. FxWirePro's Hourly Dollar Strength Index stood at 77.74 (Slightly Bullish) by 1000 GMT.
EUR/USD: The euro fell to a 1-month low as concerns over the upcoming French presidential elections weighed heavily on the major. The pair failed to benefit from better-than-expected Eurozone Sentix Investor Confidence data, which showed the continents investor confidence rose to 23.9 in April from a previous reading of 20.7 and estimates of 21.0. The European currency traded 0.1 percent down at 1.0577, having touched a low of 1.0570 earlier, its lowest since Mar. 9. FxWirePro's Hourly Euro Strength Index stood at -149.86 (Highly Bearish) by 1000 GMT. On the lower side, any close below trend line support will drag the pair down till 1.05250/1.04950. The near term resistance is around 1.06400 (support turned into resistance) and any break above will take it till 1.0686 (21- day EMA)/1.07600.
USD/JPY: The dollar rallied to a 1-week high versus its Japanese counterpart as investors awaited Federal Reserve Chair Janet Yellen's speech for further clues on the central bank's rate hike plans. However, geopolitical tensions in the Middle East and the Korean peninsula triggered a fresh bout of risk aversion, boosting the Yen's safe-haven appeal. The major traded 0.1 percent up at 111.20, having touched a high of 111.58 earlier in the day, its highest since Apr. 3. FxWirePro's Hourly Yen Strength Index stood at 77.42 (Slightly Bullish) by 1000 GMT. On the higher side, any break above 111.72 (21- day EMA) and will take the pair till 112.49 (55- day EMA)/113.44. The near term support is around 110 and any break below will drag it till 108.65.
GBP/USD: Sterling rebounded from a three-week low despite signs that UK households are becoming more cautious about their spending. The major trades 0.2 percent up at 1.2393, pulling away from a low of 1.2365 touched on Friday, its lowest since Mar. 21. FxWirePro's Hourly Sterling Strength Index stood at -37.40 (Neutral) by 1000 GMT. The pair broken support of 1.23750 and this confirms minor weakness, a decline till 1.23200 (Mar 17 low)/1.2260 (61.8% retracement of 1.19860 and 1.27060)/1.2200. On the higher side, minor bullishness can be seen only above 1.24800 and any break above targets 1.2520/1.2580/1.2616. The short term bearish invalidation is only above 1.2706. Against the euro, the pound traded 0.2 percent up at 85.35 pence, having hit a low of 85.79 the session before.
USD/CHF: The Swiss franc declined to a 4-week low as the greenback strengthened ahead of the speech by Fed Chief Janet Yellen on the economic outlook. The major traded 0.1 percent up at 1.0099, having hit a high of 1.0104 earlier in the session, its strongest since Mar. 15. FxWirePro's Hourly Swiss Franc Strength Index stood at -79.33 (Neutral) by 1000 GMT. The pair faces major near term resistance around 1.0120 and any break above targets 1.0170. Any break above 1.0170 confirms minor trend reversal, a jump till 1.03450. On the lower side, near term support is around 1.00350 (23.6% retracement of 0.98136 and 1.01045) and any violation below will take it till 1.0014 (21- day EMA)/0.9960/0.9933 (200- day MA).
AUD/USD: The Australian dollar slumped to a near 3-month low after the data released earlier showed Australia’s home financing declined in February for the first time in five months. The Aussie trades 0.1 percent down at 0.7493, having hit a low of 0.7475 earlier in the session, it’s lowest since Jan. 17. FxWirePro's Hourly Aussie Strength Index stood at -71.75 (Bearish) by 1000 GMT. On the lower side, the next immediate support stands at 0.74910 (Mar 9 low) and any break below will drag the pair down till 0.7450. The major resistance is around 0.7555 (200- day MA) and a break above will take it till 0.7605 (21- day EMA) /07680 /0.7745.
Equities Recap
European shares edged down in early trade as geopolitical tensions in the Middle East and the Korean peninsula triggered a fresh bout of risk aversion, while the greenback rallied ahead of Federal Reserve Chair Janet Yellen's speech.
The pan-European STOXX 600 index declined 0.1 percent to 380.88 points, while the FTSEurofirst 300 index fell 0.20 percent to 1,499.87 points.
Britain's FTSE 100 trades 0.04 percent down at 7,346.75 points, while mid-cap FTSE 250 rose 0.22 percent to 19,773.64 points.
Germany's DAX edged down 0.22 percent at 12,198.58 points; France's CAC 40 trades 0.57 percent lower at 5,106.12 points.
Tokyo's Nikkei gained 0.71 percent to 18,797.88 points, Australia's S&P/ASX 200 index rose 0.82 percent to 5,910.50 points. South Korea's KOSPI declined 0.86 percent to 2,133.32 points.
Shanghai composite index fell 0.5 percent to 3,269.39 points, while CSI300 index eased 0.4 percent to 3,505.14 points. Hong Kong’s Hang Seng shed 0.02 percent to 24,262.18 points.
Commodities Recap
Crude oil rose, extending gains for the third straight session, strengthened by another shutdown at Libya's largest oilfield and heightened tension over Syria. International benchmark Brent crude was trading 0.9 percent up at $55.66 per barrel by 0929 GMT, having hit a high of $56.05 on Friday, its strongest since Mar. 7. U.S. West Texas Intermediate crude rose 0.6 percent to $52.58 a barrel, after rising as high as $52.59 the prior session, its highest since Mar. 7.
Gold prices eased after touching a 5-month peak in the previous session, however, growing geopolitical tensions limited the downside. Spot gold traded 0.1 percent lower at $1,253.68 per ounce by 0937 GMT, having hit a high of $1,270.55 on Friday, its highest since Nov. 10. U.S. gold futures had dropped 0.2 percent to $1,255.40.
Treasuries Recap
The 10-year U.S treasury yield stood at 2.384 percent higher by 0.011 bps, while 5-year yield was 0.009 bps up at 1.919 percent.
The German 10-year bund yields hit lowest since February this year from mounting political uncertainty ahead of a number of crucial elections in the euro zone. The yield on the benchmark 10-year bond fell 1-1/2 basis points to 0.22 percent, the long-term 30-year bond yields dipped 1 basis point to 0.996 percent and the yield on the short-term 3-year bond traded 2-1/2 basis points lower at -0.76 percent.
The UK gilts turned rangebound on the first day of the trading week as investors remain keen to watch the country’s March consumer price inflation (CPI) and unemployment rate data, scheduled to be released on April 11 and 12 respectively. The yield on the benchmark 10-year gilts climbed 1 basis point to 1.09 percent, the super-long 30-year bond yields jumped 2 basis points to 1.71 percent while the yield on the short-term 3-year traded 1 basis point higher at 0.23 percent.
The Japanese government bonds remained mixed, as investors remain muted in subdued trading session. The benchmark 10-year bond yield traded flat at 0.05 percent, the long-term 30-year bond yields slipped 1/2 basis point to 0.84 percent while the yield on the short-term 1-year note traded 1/2 basis points higher at -0.22 percent.
The Australian government bond futures slipped, with the three-year bond contract down 3 ticks at 98.16, while the 10-year contract fell 4 ticks to 97.38. The New Zealand government bonds eased, sending yields 7 basis points higher at the long end of the curve.
