Market Roundup
- EUR/USD -0.07%, USD/JPY 0.41%, GBP/USD -0.06%, EUR/GBP -0.02%
- DXY 0.13%, DAX -0.95%, FTSE -0.4%, Brent -0.48%, Gold -0.36%
- France Consumer Confidence Mar, 100, 100 forecast, 100 previous
- Italy Industrial Orders MM SA Jan, -4.50%, 6.50% previous
- Italy Industrial Orders YY NSA Jan, 9.60%, 6.90% previous
- Italy Industrial Sales MM SA Jan, -2.80%, 2.50% previous
- Italy Industrial Sales YY WDA Jan, 5.30%, 7.20% previous
- Great Britain CBI Distributive Trades Mar, XX, 15 forecast, 8 previous
- Reuters: 5,000 UK finance jobs may be moved by Brexit, half earlier forecast
- U.S., S. Korea to revise trade pact with currency side-deal, autos concessions
- BOJ's Kuroda says need to stick with current monetary easing framework
- Gold slips from previous day's peak as dollar recovers
- Oil eases back from 2018 highs above $70 a barrel
Economic Data Ahead
- (0830 ET/1230 GMT) The U.S. Commerce Department is expected to report that gross domestic product increased at a 2.7 percent annual rate in the fourth quarter after surging at a 2.5 percent pace in the third quarter.
- (0830 ET/1230 GMT) The U.S. Commerce Department releases the personal consumption expenditures (PCE) price index for the fourth quarter. The index is expected to rise 2.7 percent, while core PCE is likely to increase 1.9 percent after posting similar gains in the third quarter.
- (0830 ET/1230 GMT) The U.S. Census Bureau is likely to report that preliminary wholesale inventories rose 0.42 percent in February after posting a gain of 0.8 percent in January.
- (0830 ET/1230 GMT) The United States releases goods trade balance data for the month of February. The economy recorded a trade deficit of $75.3 billion in the previous month.
- (1000 ET/1400 GMT) The National Association of Realtors is likely to report that U.S. pending home sales increased 2.1 percent in February after declining 4.7 percent in January.
- (1030 ET/1430 GMT) The Energy Information Administration (EIA) reports its Crude Oil Stocks for the week ending March 23.
Key Events Ahead
- (1130 ET/1530 GMT) Federal Reserve Bank of Atlanta President Raphael Bostic is slated to participate in armchair chat before the Atlanta Society of Finance and Investment Professionals.
FX Beat
DXY: The dollar index rallied as trade war tensions eased, while investors awaited U.S. gross domestic product figures for further clues on the strength of the economy. The greenback against a basket of currencies 0.2 percent up at 89.52, having touched a low of 88.94 the day before, its lowest since Feb. 16. FxWirePro's Hourly Dollar Strength Index stood at 70.20 (Bearish) by 1000 GMT.
EUR/USD: The euro declined, extending previous session losses, after the European Central Bank policymaker Ewald Nowotny said that the central bank will probably decide this summer to reduce its bond purchases if things develop as projected, warning that the ECB must not fall behind the curve. The European currency traded 0.1 percent down at 1.2393, having touched a high of 1.2476 the day before, its highest since Feb. 16. FxWirePro's Hourly Euro Strength Index stood at 81.67 (Slightly Bullish) by 1000 GMT. Immediate resistance is located at 1.2510 (Feb. 15 High), a break above targets 1.2555 (Feb. 16 High). On the downside, support is seen at 1.2368 (5-DMA), a break below could drag it lower 1.2327 (21-DMA).
USD/JPY: The dollar rallied towards the 106.00 handle after North Korea leader Jong-Un said in China that he is ready to meet with President Trump. Investors’ attention will also remain on U.S. gross domestic product, which is likely to rise at a 2.7 percent annual rate in the fourth quarter after increasing at a 2.5 percent pace in the third quarter. The major was trading 0.5 percent up at 105.88, having hit a low of 104.62 on Monday, its lowest since Nov. 2016. FxWirePro's Hourly Yen Strength Index stood at -118.68 (Highly Bearish) by 1000 GMT. Investors’ will continue to track broad-based market sentiment, ahead of the U.S. gross domestic product price index, goods trade balance, pending home sales. Immediate resistance is located at 106.18 (23.6% retracement of 106.64 and 104.62), a break above targets 106.64 (Mar. 21 High). On the downside, support is seen at 105.20, a break below could take it lower 105.05.
GBP/USD: Sterling steadied below the 1.4200 handle, supported by a report that Britain will propose a new solution for the Irish border dispute holding up Brexit talks. The Times newspaper reported that Irish officials have been informed to expect new proposals imminently from Britain on how it plans to achieve a post-Brexit soft border. The major traded 0.1 percent down at 1.4144, having hit a high of 1.4255 on Tuesday, it’s highest since Feb. 2. FxWirePro's Hourly Sterling Strength Index stood at 15.88 (Neutral) by 1000 GMT. Immediate resistance is located at 1.4233 (Jan 31 High), a break above could take it near 1.4278. On the downside, support is seen at 1.4130 (Mar 26 Low), a break below targets 1.4061 (10-DMA). Against the euro, the pound was trading flat at 87.60 pence, having hit a high of 86.68 pence on Thursday, it’s highest since June 2016.
USD/CHF: The Swiss franc fell to a 1-week low as fading fears of a global trade war dented the bid tone around the safe-haven assets. The major trades 0.5 percent up at 0.9515, having touched a high of 0.9521 earlier in the session, it’s highest since Mar. 21. FxWirePro's Hourly Swiss Franc Strength Index stood at -118.68 (Highly Bearish) by 1000 GMT. On the higher side, near-term resistance is around 0.9534 (Mar. 9 High) and any break above will take the pair to next level till 0.9569 (Mar 20 High). The near-term support is around 0.9424 (Mar. 14 Low) and any close below that level will drag it till 0.9400.
Equities Recap
European shares plunged, weighed down by losses in technology companies, while the greenback surged as investors closely watched the U.S. gross domestic product for further insight on the strength of the economy.
The pan-European STOXX 600 index tumbled 0.7 percent to 364.91 points, while the FTSEurofirst 300 index slumped 0.6 percent to 1,428.43 points.
Britain's FTSE 100 trades 0.3 percent down at 6,976.35 points, while mid-cap FTSE 250 declined 0.9 percent to 19,214.95 points.
Germany's DAX fell 1.03 percent at 11,859.99 points; France's CAC 40 trades 1.0 percent lower at 5,064.76 points.
Commodities Recap
Crude oil prices rose after slumping from multi-week highs in the prior session on a report of increasing U.S. crude inventories that surprised traders. International benchmark Brent crude was trading 0.2 percent up at $69.68 per barrel by 1026 GMT, having hit a high of $71.00 the day before, its highest since Jan. 25. U.S. West Texas Intermediate was trading 0.1 percent down at $64.61 a barrel, after rising as high as $66.52 on Monday, its strongest since Jan 25.
Gold prices eased, hovering away from an over 5-week high touched in the previous session as concerns about a trade war between the United States and China eased. Spot gold was down 0.4 percent at $1,338.07 per ounce at 1028 GMT, after touching a high of $1,356.76 in the prior session, its highest since Feb. 16. U.S. gold futures for April delivery were down 0.1 percent to $1,341.10 per ounce.
Treasuries Recap
The U.S. Treasuries climbed even as market participants are expecting a rise in the country’s Q4 gross domestic product (GDP), scheduled to be released today by 12:30GMT. The yield on the benchmark 10-year Treasuries slumped 2-1/2 basis points to 2.76 percent, the super-long 30-year bond yields slid nearly 1-1/2 basis points to 3.01 percent and the yield on the short-term 2-year too traded 1-1/2 basis points lower at 2.26 percent.
The UK gilts jumped as investors poured into safe-haven instruments ahead of the country’s fourth-quarter 2017 gross domestic product (GDP), scheduled to be released on March 29 by 08:30GMT. The yield on the benchmark 10-year gilts, slumped 5 basis points to 1.37 percent, the super-long 30-year bond yields plunged 3-1/2 basis points to 1.71 percent and the yield on the short-term 2-year traded 4-1/2 basis points lower at 0.84 percent.
The German bunds surged despite expectations of an improvement in the country’s employment report for the month of March, scheduled to be released on March 29 by 07:55GMT and the consumer price inflation (CPI) data, due by 12:00GMT will add detailed direction to the debt market. The German 10-year bond yields, which move inversely to its price, slumped 2 basis points to 0.48 percent, the yield on 30-year note also plunged 2 basis points to 1.13 percent and the yield on short-term 2-year traded tad lower at -0.59 percent.
The Japanese government bonds remained narrowly mixed in a silent session amid lack of economically significant data. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, remained tad higher at 0.03 percent, the yield on the long-term 30-year note slid 1/2 basis point to 0.73 percent and the yield on short-term 2-year too traded flat at -0.14 percent.
The Australian government bonds gained as investors moved to safe-haven buying following heavy sell-off in the high yielding alternative assets like equities. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, fell nearly 7 basis points to 2.601 percent, the yield on the long-term 30-year note dipped 7-1/2 basis points to 3.184 percent and the yield on short-term 2-year slumped 5-1/2 basis points to 1.995 percent.
