Market Roundup
- United Kingdom Feb CBI trends - orders decrease to 10 (forecast 10) vs previous 14
- Germany Feb ZEW current conditions decrease to 92.3 (forecast 93.9) vs previous 95.2
- Germany Feb ZEW economic sentiment decrease to 17.8 (forecast 16) vs previous 20.4
- Germany Jan producer prices mm increase to 0.5 % (forecast 0.3 %) vs previous 0.2 %
- Turkey Feb consumer confidence decrease to 72.25 vs previous 72.3
- Germany Jan producer prices yy decrease to 2.1 % (forecast 1.9 %) vs previous 2.3 %
- Switzerland Jan trade decrease to 1324 mln ch vs previous 3374 mln ch (revised from 2632 mln ch)
Economic Data Ahead
- (0830 ET/1330 GMT) Statistics Canada will release its wholesale trade figures for the month of December. The indicator is likely to have increased by 0.4 percent, after unexpectedly rising 0.7 percent in November.
- (1000 ET/1500 GMT) The European Commission releases Eurozone's preliminary Consumer Confidence reading for the month of February. The index posted a final reading of 1.3 in the prior month.
- (1830 ET/2330 GMT) The Faculty of Economics and Commerce Melbourne Institute will release Australia's Westpac consumer confidence for the month of January. The index edged up 0.3 percent in December.
Key Events Ahead
- No Significant Event Scheduled
FX Beat
DXY: The dollar index surged on expectations for higher Fed interest rates and stronger U.S. economic growth. The greenback against a basket of currencies traded 0.5 percent up at 89.64, having touched a high of 89.67, its highest since Feb. 14. FxWirePro's Hourly Dollar Strength Index stood at 126.59 (Highly Bullish) by 1000 GMT.
EUR/USD: The euro slumped to a 6-day low after data showed the sentiment among German investors deteriorated by less than expected in February. The Mannheim-based ZEW research institute's survey showed its economic sentiment fell to 17.8 from 20.4 in January. The European currency traded 0.5 percent down at 1.2342, having touched a high of 1.2555 on Friday, its highest since Dec 2014. FxWirePro's Hourly Euro Strength Index stood at -149.02 (Highly Bearish) by 1000 GMT. Immediate resistance is located at 1.2450, a break above targets 1.2500. On the downside, support is seen at 1.2313, a break below could drag it lower 1.2245 (Feb 7 Low).
USD/JPY: The dollar rallied, extending gains for the third consecutive session, as investors waited for minutes of the latest Federal Reserve meeting for clues on the outlook for U.S. interest rates. The major was trading 0.5 percent up at 107.16, having hit a low of 105.55 on Friday, its lowest since Nov. 2016. FxWirePro's Hourly Yen Strength Index stood at -26.38 (Neutral) by 1000 GMT. Investors’ will continue to track broad-based market sentiment, amid lack of significant data from the US docket. Immediate resistance is located at 107.45 (61.8% retracement of 110.48 and 105.74), a break above targets 108.02 (50.0% retracement). On the downside, support is seen at 106.09 (Previous Session Low), a break below could take it lower 105.40.
GBP/USD: Sterling extended decline despite a media report citing that the European Parliament was preparing to call for giving Britain privileged single market access. The major traded 0.1 percent down at 1.3985, having hit a high of 1.4144 on Friday, it’s highest since Feb 5. FxWirePro's Hourly Sterling Strength Index stood at 145.74 (Highly Bullish) by 1000 GMT. Immediate resistance is located at 1.4050, a break above could take it near 1.42144 (Feb 16 High). On the downside, support is seen at 1.3941 (10-DMA), a break below targets 1.3900. Against the euro, the pound was trading 0.4 percent up at 88.20 pence, having hit a high of 88.11 pence earlier, it’s highest since Feb. 9.
USD/CHF: The Swiss franc slumped, retreating from a 2-1/2 year low touched on Friday, as the greenback rebounded on the view that the U.S. currency was due a correction after a sell-off in recent weeks. The major trades 0.6 percent up at 0.9345, having touched a low of 0.9187 on Friday, it’s lowest since Jun 2015. FxWirePro's Hourly Swiss Franc Strength Index stood at -93.30 (Slightly Bearish) by 1000 GMT. On the higher side, near-term resistance is around 0.9374 and any break above will take the pair to next level till 0.9470 (Feb 8 High). The near-term support is around 0.9262 (Previous Session Low) and any close below that level will drag it till 0.9200.
Equities Recap
European shares slumped, while the greenback rose against a basket of currencies on expectations for higher Fed interest rates.
The pan-European STOXX 600 index declined 0.5 percent to 377.70 points, while the FTSEurofirst 300 index eased 0.2 percent to 1,478.58 points.
Britain's FTSE 100 trades 005 percent lower at 7,213.49 points, while mid-cap FTSE 250 rose 0.5 percent to 19,747.49 points.
Germany's DAX fell 0.3 percent at 12,354.35 points; France's CAC 40 trades 0.05 percent down at 5,253.63 points.
Commodities Recap
Crude oil prices declined, reversing most of its previous session gains, as a recovering dollar curbed demand. International benchmark Brent crude was trading 0.9 percent down at $64.93 per barrel by 1025 GMT, having hit a high of $65.86 the day before, its highest since Feb. 8. U.S. West Texas Intermediate was trading 1.05 percent down at $61.80 a barrel, after rising as high as $62.62 earlier, its strongest since Feb. 8.
Gold prices declined for a third straight session as the greenback rebounded from over three-year lows hit last week. Spot gold was 0.7 percent down at $1,337.45 an ounce at 1029 GMT, having declined to its lowest level since Feb. 14 at $1,336.53 earlier. U.S. gold futures were down 1.2 percent at $1,340.4 per ounce, posting its biggest one-day percentage fall since Nov. 2017.
Treasuries Recap
The UK gilts continued to decline during European session as investors wait to watch the country’s employment report for the month of January, due on February 21 by 09:30GMT. The yield on the benchmark 10-year gilts, rose 1-1/2 basis points to 1.61 percent, the super-long 30-year bond yields surged 1 basis point to 2.00 percent and the yield on the short-term 2-year traded nearly 1-1/2 basis points higher at 0.68 percent.
The German bunds fell Tuesday after the country’s ZEW economic sentiment index for the month of February beat market expectations; however, the downside was limited as investors await the manufacturing PMI for similar period, scheduled to be released on February 22 by 08:30GMT. The German 10-year bond yields, which move inversely to its price, rose 1/2 basis point to 0.73 percent, the yield on 30-year note also surged 1 basis point to 1.40 percent and the yield on short-term 2-year too traded 1 basis point higher at -0.49 percent.
The New Zealand government bonds closed mixed as investors wait to watch the country’s GlobalDairyTrade (GDT) price auction, scheduled to be held later today and the retail sales for the fourth quarter of 2017, due on February 22 by 21:45GMT. At the time of closing, the yield on the benchmark 10-year Treasury note, which moves inversely to its price, surged 1-1/2 basis points to 3.01 percent, the yield on 20-year also climbed 1-1/2 basis points to 3.52 percent while the yield on short-term 2-year closed 1 basis point lower at 1.89 percent.
The Japanese government bonds traded sideways as investors await the Bank of Japan’s policymaker Funo’s speech, scheduled to be held on February 21 by 01:10GMT, besides, the country’s national consumer price inflation (CPI), due on the following data by 23:30GMT for added direction in the debt market. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, hovered around 0.06 percent, the yield on the long-term 30-year note remained flat at 0.79 percent and the yield on short-term 2-year also steadied at -0.15 percent.
The Australian bonds slumped on after policymakers showed optimism over economic growth outlook in February minutes, mapping out a steady course for rates at its first meeting of 2018 this month. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, rose 1-1/2 basis points to 2.889 percent, the yield on the long-term 30-year note surged 1 basis point to 3.515 percent and the yield on short-term 2-year up 2 basis points to 2.052 percent.
