Market Roundup
- EUR/USD 0.04%, USD/JPY 0.39%, GBP/USD 0.02%, EUR/GBP -0.04%
- DXY -0.02%, DAX 0.08%, FTSE 0.33%, Brent 0.8%, Gold -0.54%
- UK lawmakers urge May to heed them on alternative Brexit plans
- Fed could build firepower for new Operation Twist: Harker
- Recession fears, Brexit keep German 10-year bunds below zero
- France cut its budget deficit to 12-year low in 2018
- Germany Apr Gfk Consumer Sentiment, 10.4, 10.8 f'cast, 10.8 prev, 10.7 r'vsd
- France Q4 GDP QQ Final, 0.3%, 0.3% f'cast, 0.3% prev
- France Mar Business Climate Mfg, 102, 103 f'cast, 103 prev
- UK Feb Finance Mortgage Apps, 35.299k, 40.634k prev, 39.555k r'vsd
Economic Data Ahead
- (0830 ET/1230 GMT) The U.S. Department of Commerce is expected to report that housing starts declined to a 1.215 million-unit rate in February from 1.230 million-unit in January.
- (0830 ET/1230 GMT) The U.S. building permits are likely to have decreased to a 1.300 million-unit pace in February from a 1.317 million unit pace in January.
- (0900 ET/1300 GMT) The S&P/Case-Shiller is expected to report that U.S. home price index of 20 metropolitan areas rose at an annualized rate of 4.0 percent in January, after post a gain of 4.2 percent in the previous month.
- (0900 ET/1400 GMT) The Federal Housing Finance Agency releases its housing price index for the month of January. The index gained 0.3 percent in December.
- (1000 ET/1400 GMT) The U.S. Conference Board is likely to show consumer confidence index rose to 132 for the month of March from a final reading of 131.4 in February.
- (1000 ET/1400 GMT) Federal Reserve Bank of Richmond will publish its Manufacturing Index for March. The index posted a rise of 16 in the prior month.
Key Events Ahead
- (0800 ET/1200 GMT) ECB Governing Council member Jozef Makuch holds news conference in Bratislava
- (0830 ET/1230 GMT) Federal Reserve Bank of Philadelphia to issue non-manufacturing business outlook survey for March
- (1500 ET/1900 GMT) Federal Reserve Bank of San Francisco President Mary Daly speaks before the event, "Managing Inflation in the Current Economy" hosted by the Commonwealth Club, San Francisco.
FX Beat
DXY: The dollar index firmed as U.S. 10-year Treasury yields recovered slightly from 2017 lows touched in the previous session. The greenback against a basket of currencies traded flat at 96.49, having touched a peak of 96.81 on Friday, its highest since Mar. 14. FxWirePro's Hourly Dollar Strength Index stood at -71.31 (Bearish) by 1100 GMT.
EUR/USD: The euro edged higher, extending previous day gains after economic surveys showed tentative signs of a recovery in the euro zone economy. However, the upside appears limited after another survey showing German consumer morale deteriorated unexpectedly heading into April, indicating that household spending could weaken in the second quarter of 2019. The European currency traded 0.1 percent up at 1.1319, having touched a low of 1.1273 on Friday, its lowest since Mar. 12. FxWirePro's Hourly Euro Strength Index stood at -55.17 (Bearish) by 1000 GMT. Immediate resistance is located at 1.1359 (Mar. 18 High), a break above targets 1.1408 (Mar. 1 High). On the downside, support is seen at 1.1273 (Mar. 22 Low), a break below could drag it till 1.1221 (Mar. 11 Low).
USD/JPY: The dollar surged as investor risk sentiment improved after Chinese Premier Li Keqiang reaffirmed Beijing's pledge to further open up to foreign investment as he met with global business executives. The major was trading 0.4 percent up at 110.39, having hit a low of 109.70 on Monday, its lowest since Feb. 8. FxWirePro's Hourly Yen Strength Index stood at -59.07 (Bearish) by 1000 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. building permits, housing starts, home price indices, and Richmond Fed manufacturing index. Immediate resistance is located at 110.46 (Feb. 11 High), a break above targets 111.07 (Feb. 26 High). On the downside, support is seen at 109.63 (Dec. 31 Low), a break below could take it lower at 109.55 (Feb. 6 Low).
GBP/USD: Sterling rallied to a near 1-week peak, after the British parliament's vote to take control of the Brexit process for a day raised expectations that lawmakers can end an impasse on Britain's European Union exit. However, the chances of a snap election capped upside. The major traded 0.3 percent up at 1.3231, having hit a low of 1.3003 on Thursday; it’s lowest since Mar. 11. FxWirePro's Hourly Sterling Strength Index stood at 104.17 (Highly Bullish) 1000 GMT. Immediate resistance is located at 1.3254 (Mar. 4 High), a break above could take it near 1.3311 (Mar. 19 High). On the downside, support is seen at 1.3146 (Mar. 20 Low), a break below targets 1.3068 (Mar. 7 Low). Against the euro, the pound was trading 0.1 percent up at 85.57 pence, having hit a low of 87.22 on Thursday, it’s lowest since Feb. 22.
USD/CHF: The Swiss franc eased, reversing some of its previous session gains, as the greenback rose following a rebound in the U.S. Treasury yields. The major trades 0.05 percent up at 0.9927, having touched a low of 0.9894 on Wednesday; it’s lowest since Jan. 16. FxWirePro's Hourly Swiss Franc Strength Index stood at -4.77 (Neutral) by 1000 GMT. On the higher side, near-term resistance is around 0.9986 (Jan. 22 High) and any break above will take the pair to next level till 1.0024 (Feb. 22 High). The near-term support is around 0.9895 (Jan.17 Low), and any close below that level will drag it till 0.9852 (Jan. 4 Low).
Equities Recap
European shares surged, boosted by gains in the retail sector and personal and household goods sector, while euro gained as surveys indicated economic recovery.
The pan-European STOXX 600 index surged 0.3 percent at 375.57 points, while the FTSEurofirst 300 index rallied 0.4 percent to 1,479.41 points.
Britain's FTSE 100 trades 0.3 percent up at 7,200.41 points, while mid-cap FTSE 250 gained 0.2 to 18,837.92 points.
Germany's DAX rose 0.05 percent at 11,353.05 points; France's CAC 40 trades 0.5 percent higher at 5,284.09 points.
Commodities Recap
Crude oil prices rose, supported by supply cuts led by producer cartel OPEC and U.S. sanctions against Iran and Venezuela, however, concerns about a potential recession capped gains. International benchmark Brent crude was trading 0.7 percent up at $67.72 per barrel by 1002 GMT, having hit a high of $68.67 on Thursday, its highest since Nov. 13. U.S. West Texas Intermediate was trading 0.8 percent higher at $59.51 a barrel, after rising as high as $60.37 on Thursday, its highest since the Nov. 12.
Gold prices declined, after hitting 1-month high in the previous session, as a slight recovery in share markets and U.S. Treasury yields dented the metal's safe-haven demand. Spot gold eased 0.5 percent at $1,314.65 per ounce by 1007 GMT, having touched a high of $1,324.40 on Monday, its highest since Feb 28. U.S. gold futures were down 0.4 percent at $1,317.10 an ounce.
Treasuries Recap
The U.S. Treasuries fell during afternoon session, amid a muted trading session that is scheduled to witness data of little economic significance. However, the country’s short-term 2-year auction and FOMC member Daly’s speech, due today at 17:00GMT and 19:00GMT respectively can be watched out for. The yield on the benchmark 10-year Treasury yield jumped nearly 2-1/2 basis points to 2.441 percent, the super-long 30-year bond yields also climbed 2-1/2 basis points to 2.893 percent and the yield on the short-term 2-year surged close to 3-1/2 basis points to 2.289 percent.
The German bunds traded slightly lower during European session ahead of the European Central Bank President Mario Draghi’s speech, scheduled to be held on March 27 by 08:00GMT and the country’s 10-year auction, due on the same day by 10:40GMT. The German 10-year bond yields, which move inversely to its price, rose nearly 1-1/2 basis points to -0.011 percent, the yield on 30-year note remained flat at 0.587 percent and the yield on short-term 2-year too traded 1-1/2 basis points higher at -0.555 percent.
The Japanese government bond yields jumped after investors shifted their interests toward riskier assets following a short-covering across all markets. The yield on the benchmark 10-year JGB note, which moves inversely to its price, improved to -0.062 percent, the yield on the long-term 30-year surged nearly 3 basis points to 0.534 percent and the yield on short-term 2-year jumped to -0.165 percent.
The Australian government bond yields pared losses during the Asian trading session, as investors have largely shrugged-off the fall in the United States counterpart in the overnight session amid fears of global growth. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, rose 1-1/2 basis points to 1.791 percent, the yield on the long-term 30-year bond also surged 1-1/2 basis points to 2.435 percent and the yield on short-term 2-year too traded 1-1/2 basis points higher at 1.472 percent.
