Market Roundup
- EUR/USD -0.05%, USD/JPY +0.05%, GBP/USD -0.25%, DXY +0.1%
- DAX +0.1%, CAC -0.3%, Brent +0.2%, Gold -0.05%, Copper -0.6%
- Dollar recovers after dip in Asian time
- Sterling down ahead of Brexit vote in parliament
- EZ Q4 revised GDP 0.4% q/q, 1.7% y/y vs previous 0.4%/1.7%. 0.4%/1.7% forecast
- Great Britain Feb BRC Retail sales -0.4% y/y vs previous -0.6% +0.2% forecast
- Great Britain Feb Halifax house prices +0.1% m/m vs previous -1.1% revised +0.3% forecast
- Germany Jan Industrial orders -7.4% m/m vs previous 5.2%. -2.5% forecast
- Swiss forex reserves at 668.18bln end of Feb vs 643.939bln end of Jan
- China FX reserves rebound above $3 trillion in Feb, first rise in 8 months
- China FX regulator: cross-border outflows will ease, FX reserve levels to stabilize
- BoJ Masai: Big yen swings cause for concern
Economic Data Ahead
- (0830 ET/1330 GMT) The United States releases trade balance figures for the month of January. The economy's trade deficit is expected to have widened to $48.5 billion from 44.3 billion in December.
- (0830 ET/1330 GMT) The Statistics Canada is likely to report that international trade deficit narrowed to C$0.70 billion in January from C$0.92 billion in December.
- (1000 ET/1500 GMT) The Investor's Business Daily (IBD)/ TechnoMetrica Institute of Policy and Politics (TIPP) will release U.S. Economic Optimism index for the month of March. The indicator is expected to advance to 57.1 after rising to 56.4 in the previous month.
- (1000 ET/1500 GMT) The Richard Ivey School of Business releases Canada's seasonally adjusted Ivey Purchasing Managers Index for the month of February. The index posted a reading of 57.2 in the prior month.
- (1500 ET/2000 GMT) The U.S. Federal Reserve is likely to report that consumer credit rose to $17.10 billion in January from $14.16 billion the month before.
- (1630 ET/2130 GMT) API reports its weekly crude oil stock.
- (1645 ET/2145 GMT) Statistics New Zealand will release its manufacturing sales for the fourth quarter. The indicator rose 2.1 percent in the previous quarter.
- (1850 ET/2350 GMT) Japan's Cabinet Office will release gross domestic product for the first quarter. The economy grew at an annualized pace of 1.0 percent in the previous quarter.
- (1850 ET/2350 GMT) Japan's Ministry of Finance is likely to report that Current Account (N.S.A) surplus narrowed to 239.0 billion yen in January from 1,112.2 billion yen in December.
- (1850 ET/2350 GMT) Japan's Customs Office will release Trade Balance (BOP Basis) figures for the month of January. The economy posted a trade surplus of 806.8 billion yen in the earlier month.
Key Events Ahead
- (1430 ET/1930 GMT) FedTrade operation 30-yr Ginnie Mae (max $1.325 bn)
FX Beat
DXY: The dollar recovered versus its major peers following a rise in the U.S. Treasury yields across the curve. The greenback against a basket of currencies traded 0.05 percent up at 101.74, having hit a low of 101.22 the prior day, it’s lowest since Feb. 28. FxWirePro's Hourly Dollar Strength Index stood at -17.05 (Neutral) by 1100 GMT.
EUR/USD: The euro declined, extending previous session losses, as the dollar attempted a minor recovery across the board on the back of rising U.S. Treasury yields. Markets ignored Eurozone Q4 GDP revision figures, which came in line with expectations and previous as investors continued to track sentiment around the greenback. The European currency traded 0.05 percent down at 1.0576, having hit a high of 1.0639 on Monday, it’s highest since Feb. 17. FxWirePro's Hourly Euro Strength Index stood at 128.15 (Highly Bullish) by 1100 GMT. The further jump will happen only above 1.06600 level and any break above will take the pair till 1.07200/1.07450 level. On the lower side, major support is around 1.04900 short term low formed at Feb 22 and any break below targets 1.04500/1.03400.
USD/JPY: The dollar edged up after a solid comeback in the treasury yields across the curve in wake of the probability of a March Fed rate hike rising to nearly 90 percent. However, heightened geopolitical risks, following concerns over North Korea and France political uncertainty boosted the Japanese Yen's safe-haven appeal, eventually confining the major in a narrow range. The major traded flat at 113.93, having hit a low of 113.55 hit on Monday, its lowest since Mar. 1. FxWirePro's Hourly Yen Strength Index stood at 36.47 (Neutral) by 1100 GMT. The minor resistance is around 114.95 (Feb 15th high) and any break above will take the pair till 115.94. On the lower side, minor support is around 113.45 (21- day EMA) and any break below 112 will drag it till 111.65/111.
GBP/USD: Sterling tumbled to a 7-week low below the 1.2200 handle, ahead of the second vote in Britain's upper house of parliament on legislation giving Prime Minister Theresa May the right to start official Brexit talks. The selling pressure intensified are UK Halifax house prices came in at 0.1 percent in February, missing estimates of 0.3 percent rise. Sterling trades 0.3 percent down at 1.2193, having hit a low of 1.2182 earlier, its weakest since Jan. 17. FxWirePro's Hourly Sterling Strength Index stood at -121.55 (Highly Bearish) by 1100 GMT. On the lower side, break below 1.2200 confirms minor weakness, a decline till 1.2080 is likely. The minor intraday bullishness can happen only above 1.2300 (Mar 3rd high) and any break above will take it till 1.2350 (Support turned into resistance)/ 1.2413 (200- H MA).
USD/CHF: The Swiss franc declined, extending losses from the previous session as the greenback attempted a minor recovery following a rise in the U.S. Treasury yields. The major trades 0.22 percent higher at 1.0141, having hit a high of 1.0154 earlier in the session, its strongest since Jan. 11. FxWirePro's Hourly Swiss Franc Strength Index stood at 6.32 (Neutral) by 1100 GMT. The pair is facing strong trend line support around 1.0680 (trend line joining 0.98696 and 0.99636) and any break below targets 1.0000/0.99636 (Feb 16th low). On the higher side, 1.0160 (61.8% retracement of 1.03436 and 0.98696) will be acting as major resistance and any break above will take it till 1.0200/1.02480 (Jan 11th high).
AUD/USD: The Australian dollar trimmed gains after rising to a three day high following Reserve Bank of Australia's March policy meeting which ended with rates unchanged at 1.5 percent as widely expected and showed no hint of considering another easing. The Aussie trades up 0.2 percent at 0.7594, having touched an early high of 0.7632, it’s highest since Mar. 2. FxWirePro's Hourly Aussie Strength Index stood at 30.55 (Neutral) by 1100 GMT. On the lower side, the major support stands at 0.7539 (100- day EMA) and any break below will drag the pair down till 0.7520 (200- day MA)/0.74450 (Jan 13th low). The major resistance is around 0.7636 (21- day EMA) and a break above will take it till 0.7680/0.7740.
Equities Recap
European shares extended losses in early deals, weighed down by financials shares, while the dollar gained across the board following a rebound in the U.S. Treasury yields.
The pan-European STOXX 600 index decreased 0.1 percent to 373.02 points, while the FTSEurofirst 300 index eased 0.1 percent to 1,471.70 points.
Britain's FTSE 100 trades 0.1 percent higher at 7,357.72 points, while mid-cap FTSE 250 added 0.18 percent to 18,915.14 points.
Germany's DAX edged up 0.15 percent at 11,976.00 points; France's CAC 40 trades 0.25 percent lower at 4,959.76 points.
Tokyo's Nikkei eased 0.18 percent to 19,344.15 points, Australia's S&P/ASX 200 index rose 0.24 percent to 5,760.20 points and South Korea's KOSPI gained 0.61 percent to 2,094.05 points.
Shanghai composite index advanced 0.3 percent to 3,242.41 points, while CSI300 index climbed 0.2 percent to 3,453.96 points. Hong Kong’s Hang Seng added 0.4 percent to 23,681.07 points.
Commodities Recap
Crude oil prices rose, extending gains for the third consecutive session, despite rising concern over rising U.S. shale output. International benchmark Brent crude was trading 0.2 percent up at $56.08 per barrel by 1050 GMT, having hit a low of $55.01 on Thursday, its lowest since Feb. 8. U.S. West Texas Intermediate crude trades 0.2 percent up at $53.31 a barrel, after tumbling to a trough of $52.52 last week, its weakest since Feb. 9.
Gold prices declined, hitting a near 3-week low earlier in the session as growing expectations of a U.S. interest rate hike this month supported the greenback. Spot gold fell 0.1 percent at $1,223.96 per ounce at 1053 GMT, having hit an early low of $1,222.22, the lowest since Feb. 15. U.S. gold futures were flat at $1,225.50.
Treasuries Recap
The U.S. Treasuries plunged ahead of the 10-year auction scheduled to be held on Wednesday and the labour market report that follows it. The yield on the benchmark 10-year Treasury jumped 1-1/2 basis points to 2.50 percent, the super-long 30-year bond yield also rose 1-1/2 basis points to 3.11 percent and the yield on short-term 2-year note traded 1 basis point higher at 1.31 percent.
The UK gilts remained flat in mild trading session and after Britons overwhelmingly oppose Theresa May’s plan to quit the EU with no deal in place if Parliament dares to reject the terms she agrees with Brussels, an exclusive poll by The Independent has revealed. The yield on the benchmark 10-year gilts, rose 1/2 basis point to 1.21 percent, the super-long 30-year bond yields hovered around 1.82 percent and the yield on the short-term 2-year remained flat at 0.11 percent.
The German government bunds gained ahead of the 5-year auctions scheduled to be held on March 8. The yield on the benchmark 10-year bond, slumped 1 basis point to 0.33 percent, the long-term 15-year bond yields fell nearly 1 basis point to 0.56 percent and the yield on short-term 2-year bond plunged nearly 2 basis points to -0.84 percent.
The Japanese government bonds remain muted as investors refrain from any major trading activity ahead of the fourth-quarter gross domestic product (GDP), due to be released today. The benchmark 10-year bond yield, which moves inversely to its price, rose 1/2 basis point to 0.08 percent, while the long-term 30-year bond yields fell nearly 1 basis point to 0.84 percent while the yield on the short-term 2-year note traded 1/2 basis point lower at -0.28 percent.
The New Zealand government bonds traded flat as investors remain sidelined ahead of the GlobalDairyTrade (GDT) price auction, scheduled to be held later today for further direction in the bond market. The yield on the benchmark 10-year bond, hovered around 3.33 percent at the time of closing, the yield on 7-year note also trade flat at 2.89 percent and the yield on short-term 2-year note also traded 1/2 basis point lower at 2.20 percent.
The Australian bonds plunged after the Reserve Bank of Australia (RBA) remained on hold at today’s monetary policy meeting, hinting at no further policy easing in the near-term. The yield on the benchmark 10-year Treasury note, rose 1 basis point to 2.82 percent, the yield on 15-year note also nearly 1-1/2 basis points to 3.23 percent while the yield on short-term 2-year traded nearly 1/2 basis point lower at 1.84 percent.
