Market Roundup
- U.S. waters down demand China ax subsidies in push for trade deal -sources
- Trump says Fed should fire up crisis-era stimulus
- SNB's Jordan sees room for more intervention if needed
- Trade rows cloud global economy as officials fret over slowdown
- UK fears Brexit could hurt global hunt for new BoE governor
- OECD says Japan should rely on sales tax to generate extra revenue
- Poll shows support for Australia's far-right One Nation sinking before election
Economic Data Ahead
- (0600 ET/1000 GMT) EZ Mar Reserve Assets Total, 732.86 bln prev
Key Events Ahead
- (0645 ET/1045 GMT) BoE's Sarah Breeden participates in OMFIF in London
- (0830 ET/1230 GMT) Chicago Fed's Charles Evans appears on CNBC's "Squawk Box" in New York
- (1200 ET/1600 GMT) BoE's Jonathan Haskel participates at the Royal Economic Society Annual Conference in London
- (1300 ET/1700 GMT) Chicago Fed's Charles Evans speaks before the New York Association for Business Economics in New York
FX Beat
DXY: The dollar index declined after European Central Bank President Mario Draghi expressed concern about the U.S. Federal Reserve's independence, warning that a loss of its autonomy could undermine the credibility of policy. The greenback against a basket of currencies traded 0.05 percent down at 96.83, having touched a low of 96.75 on Friday, its lowest since Mar. 27. FxWirePro's Hourly Dollar Strength Index stood at -53.30 (Bearish) by 0500 GMT.
EUR/USD: The euro steadied above the 1.3100 handle, supported by encouraging data from the eurozone where industrial output in February declined by less than expected. The European currency traded 0.1 percent up at 1.1307, having touched a high of 1.1323 on Friday, its highest since Mar. 26. FxWirePro's Hourly Euro Strength Index stood at 90.99 (Slightly Bullish) by 0500 GMT. Investors’ attention will remain on the New York empire state manufacturing index, and Fed Evan's speech, amid a lack of data from the Euzozone docket. Immediate resistance is located at 1.1331 (Mar. 25 High), a break above targets 1.1361 (Mar. 19 High). On the downside, support is seen at 1.1273 (Mar. 22 Low), a break below could drag it till 1.1213 (Mar. 28 Low).
USD/JPY: The dollar slightly eased after rising to a near 6-week peak earlier in the session on signs of stabilization in the Chinese economy and on hopes U.S.-China trade talks were approaching a final lap. The major was trading 0.1 percent down at 111.92, having hit a high of 112.09, its highest since Mar. 5. FxWirePro's Hourly Yen Strength Index stood at -94.74 (Slightly Bearish) by 0500 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of New York empire state manufacturing index and Fed Evan's speech. Immediate resistance is located at 112.60 (Dec. 20 High), a break above targets 113.24 (Dec. 5 High). On the downside, support is seen at 111.20 (Apr. 3 Low), a break below could take it lower at 110.53 (Mar. 20 Low).
GBP/USD: Sterling surged, extending gains for the second straight session, as European Union leaders agreement on a six-month delay to Brexit removed the imminent threat of a no-deal exit. The major traded 0.2 percent up at 1.3088, having hit a high of 1.3132 on Friday; it’s highest since Apr. 4. FxWirePro's Hourly Sterling Strength Index stood at -4.18 (Neutral) 0500 GMT. Investors’ attention will remain on the U.S. fundamental drivers, as the UK economic calendar remains absolutely data empty. Immediate resistance is located at 1.3121 (Apr. 5 High), a break above could take it near 1.3149 (Apr. 1 High). On the downside, support is seen at 1.3022 (Apr. 8 Low), a break below targets 1.3003 (Mar. 21 Low). Against the euro, the pound was trading 0.1 percent up at 86.35 pence, having hit a low of 86.57 on Thursday, it’s lowest since Mar. 22.
AUD/USD: The Australian dollar declined after rising to a near 7-week high on Friday on news that U.S. Treasury Secretary Steven Mnuchin voiced optimism for a trade deal with China to end a tariff war. The Aussie trades 0.05 percent down at 0.7168, having hit a high of 0.7192 the day before; it’s highest since Feb. 27. FxWirePro's Hourly Aussie Strength Index stood at 78.43 (Slightly Bullish) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7142 (Feb. 26 Low), a break below targets 0.7070 (Mar. 29 Low). On the upside, resistance is located at 0.7198 (Feb. 27 High), a break above could take it near 0.7235 (Jan. 11 High).
NZD/USD: The New Zealand dollar surged to an 11-day high amid signs of improvement in the Chinese economy, adding to growing optimism that Washington and Beijing are nearing a trade deal. The Kiwi trades 0.1 percent up at 0.6769, having touched a high of 0.6782, its highest level Apr. 4. FxWirePro's Hourly Kiwi Strength Index was at 48.59 (Neutral) by 0400 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6799 (Apr. 4 High), a break above could take it near 0.6827 (Mar. 5 High). On the downside, support is seen at 0.6706 (Jan. 22 Low), a break below could drag it below 0.6668 (Jan. 4 Low).
Equities Recap
Asian shares surged near 9-month highs after U.S. Treasury Secretary Steven Mnuchin said he hoped U.S.-China trade talks were approaching a final lap.
MSCI's broadest index of Asia-Pacific shares outside Japan rallied 0.6 percent.
Tokyo's Nikkei rose 1.4 percent to 22,169.11 points, Australia's S&P/ASX 200 index gained 0.05 percent to 6,251.40 points and South Korea's KOSPI surged 0.4 percent to 2,242.88 points.
Shanghai composite index declined 0.3 percent to 3,179.08 points, while CSI 300 index traded 0.3 percent down at 3,978.22 points.
Hong Kong’s Hang Seng traded 0.05 percent lower at 29,910.61 points. Taiwan shares added 0.5 percent to 10,875.60 points
Commodities Recap
Crude oil prices declined after international benchmark Brent hit a fresh 5-month high in the previous session on concerns over global supplies. International benchmark Brent crude was trading 0.2 percent lower at $71.32 per barrel by 0520 GMT, having hit a high of $71.85 on Friday, its highest since Nov. 8. U.S. West Texas Intermediate was trading 0.4 percent down at $63.54 a barrel, after rising as high as $64.77 on Tuesday, its highest since the Nov. 1.
Gold prices plunged to an over 1-week low as stronger-than-expected data from China and a robust start to the U.S. earnings season eased concerns about global economic slowdown. Spot gold declined 0.2 percent to $1,288.28 per ounce by 0526 GMT, having touched a low of $1,286.81, its lowest since April 5. U.S. gold futures fell 0.3 percent to $1,291 an ounce.
Treasuries Recap
The Japanese government bond prices slipped, with the benchmark 10-year JGB yield rising two basis points to minus 0.035 percent. The 20-year yield also climbed two basis points, to 0.370 percent, while the 30-year yield gained 2.5 basis point to 0.540 percent.
The Australian government bond futures were also weaker, with the three-year bond contract off 4 ticks at 98.55. The 10-year contract slipped 6.5 ticks to 98.045.
The New Zealand government bonds eased, sending yields about 4 basis points higher in the long end of the curve.
