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Asia Roundup: Aussie eases as consumer confidence deteriorates, greenback declines on Fed rate cut expectations, Asian shares plunge - Wednesday, June 12th, 2019

Market Roundup

  • Trump presses China to reverse stance on structural reform if it wants trade deal
     
  • Tens of thousands paralyse Hong Kong's financial hub over extradition bill
     
  • Trump flaunts 'secret' migration deal already revealed by Mexico
     
  • "Delay means defeat" - Johnson commits to October Brexit deadline
     
  • China c.bank to inject 35 bln yuan via OMO, resuming 28-day tenor - traders
     
  • China May CPI YY, 2.7%, 2.7% f'cast, 2.5% prev
     
  • China May PPI YY, 0.6%, 0.6% f'cast, 0.9% prev
     
  • Japan Apr Machinery Orders YY, 2.5%, -5.3% f'cast, -0.7% prev
     
  • Australia Jun Westpac-MI Consumer Sentiment, -0.6%, 0.6% prev
     

Economic Data Ahead

  • (1901 ET/2301 GMT) Great Britain May RICS Housing Survey, -21 f'cast, -23 prev

Key Events Ahead

  • (0400 ET/0800 GMT) ECB's Member and Lithuanian Central Bank Governor Vitas Vasiliauskas addresses press conference to introduce newest Lithuanian financial stability report in Vilnius
     
  • (0415 ET/0815 GMT) ECB's Mario Draghi gives welcome address at 8th ECB conference on central, eastern and south-eastern European (CESEE) countries in Frankfurt
     
  • (0500 ET/0900 GMT) ECB's Luis de Guindos chairs Session 1 on "Responses to trade shocks" at 8th ECB conference on CESEE countries in Frankfurt
     
  • (0815 ET/1215 GMT) ECB's Benoit Coeure chairs Session 2 on "Responses to monetary and financial shocks" at 8th ECB conference on CESEE countries in Frankfurt
     
  • (1100 ET/1500 GMT) Closing remarks by ECB Board member Benoit Coeure at Bond Market Contact Group (BMCG) meeting organised by ECB in Frankfurt
     

FX Beat

DXY: The dollar index declined as expectations for a U.S. central bank rate cut this year rose after a number of Fed officials, including Chairman Jerome Powell, hinted they were open to easing monetary policy.  The greenback against a basket of currencies traded 0.1 percent down at 96.64, having touched a low of 96.46 on Friday, its lowest since Mar. 25. FxWirePro's Hourly Dollar Strength Index stood at 2.48 (Neutral) by 0600 GMT.

EUR/USD: The euro rose, hovering closer to a three-month peak scaled last week, ahead of European Central Bank (ECB) President Draghi's speech. Last week, the ECB stated that it would delay the rate hike until middle of next year and offered to pay banks if they pass on the cash borrowed from the central bank to households and firms. The European currency traded 0.1 percent up at 1.1338, having touched a high of 1.1347 on Friday, its highest since Mar. 22. FxWirePro's Hourly Euro Strength Index stood at 84.45 (Bullish) by 0600 GMT. Investors’ attention will remain on series of data from the Eurozone economies and ECB officials' speeches, ahead of the U.S. consumer price index and monthly budget statement. Immediate resistance is located at 1.1359 (Mar. 18 High), a break above targets 1.1402 (Feb. 16 High). On the downside, support is seen at 1.1263 (Mar. 26 Low), a break below could drag it below 1.1201 (May 14 Low).

USD/JPY: The dollar declined, retreating from a 1-week peak hit in the previous session, as increasing expectations the U.S. Federal Reserve could cut interest rates sometime in the next few months dented the bid tone around the major. The pair was trading 0.2 percent down at 108.32, having hit a high of 108.80 on Tuesday, its highest since May 31. FxWirePro's Hourly Yen Strength Index stood at -70.58 (Bearish) by 0600 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. consumer price index and monthly budget statement. Immediate resistance is located at 108.87 (50.0% retracement of 109.92 and 107.81), a break above targets 109.47 (78.6% retracement). On the downside, support is seen at 107.88 (June 3 Low), a break below could take it lower at 107.51 (Jan. 4 Low).

GBP/USD: Sterling edged up, extending previous session gains, after data released yesterday showed UK wage growth in the three months to April rose to 3.1 percent, surpassing forecast of 3 percent, while the jobless rate held at its lowest since 1975. The major traded 0.1 percent up at 1.2727, having hit a high of 1.2763 on Friday; it’s highest since May 21. FxWirePro's Hourly Sterling Strength Index stood at 98.17 (Neutral) 0600 GMT. Investors’ attention will remain on the U.S. fundamental drivers, ahead of the UK RIC's housing price balance. Immediate resistance is located at 1.2763 (June 7 High), a break above could take it near 1.2798 (May 17 High). On the downside, support is seen at 1.2647 (May 24 Low), a break below targets 1.2580 (May 30 Low). Against the euro, the pound was trading 0.1 percent down at 89.09 pence, having hit a low of 89.32 on Tuesday, it’s lowest since Jan. 15.

AUD/USD: The Australian dollar plunged to a 9-day low after domestic data showed consumer confidence eased 0.6 percent in June amid concerns about the economic outlook. The Aussie trades 0.2 percent down at 0.6949, having hit a high of 0.7022 on Friday, it’s highest since May 8. FxWirePro's Hourly Aussie Strength Index stood at -92.89 (Slightly Bearish) by 0600 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.6914 (May 15 Low), a break below targets 0.6881 (May 24 Low). On the upside, resistance is located at 0.7029 (May 2 High), a break above could take it near 0.7061 (May 1 High).

NZD/USD: The New Zealand dollar slumped for the third straight session, as data on electronic retail card spending surprised by showing a 0.5 percent decline in May, led by softness in durable goods. The Kiwi trades 0.1 percent lower at 0.6577, having touched a high of 0.6681 on Friday, its highest level April 30. FxWirePro's Hourly Kiwi Strength Index was at -87.40 (Slightly Bearish) by 0600 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6619 (June 4 High), a break above could take it near 0.6681 (June 7 High). On the downside, support is seen at 0.6550 (May 15 Low), a break below could drag it below 0.6513 (May 17 Low).

Equities Recap

Asian shares tumbled after two days of gains, as the White House took a tough line on trade talks with China.

MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.5 percent.

Tokyo's Nikkei declined 0.4 percent to 21,129.72 points, Australia's S&P/ASX 200 index plunged 0.05 percent to 6,543.70 points and South Korea's KOSPI slumped 0.3 percent to 2,106.22 points.

Shanghai composite index fell 0.5 percent to 2,911.16 points, while CSI 300 index traded 0.7 percent down at 3,693.08 points.

Hong Kong’s Hang Seng traded 1.9 percent lower at 27,252.90 points. Taiwan shares added 0.1 percent to 10,615.66 points

Commodities Recap

Crude oil prices declined by more than 1 percent, weighed down by a weaker oil demand outlook and a rise in U.S. crude inventories despite growing expectations of ongoing OPEC-led supply cuts. International benchmark Brent crude was trading 1.4 percent lower at $61.19 per barrel by 0543 GMT, having hit a high of $63.81 on Monday, its highest since May 31. U.S. West Texas Intermediate was trading 1.4 percent down at $52.29 a barrel, after rising as high as $54.80 on Monday, its highest since the May 31.

Gold prices rose after falling to a 1-week low in the previous session, as worries over U.S.-China trade war flared up, denting risk appetite. Spot gold was trading 0.6 percent to $1,333.53 by 0546 GMT, having touched a low of $1,319.79 on Monday, its lowest since June 3. U.S. gold futures were up 0.4 percent at $1,336.10 an ounce.

Treasuries Recap

The Japanese government bonds were little changed. with the September 10-year JGB futures rising 0.02 point to 153.44, while the 10-year cash JGB yield was flat at minus 0.115 percent In the super-long zone, the 40-year and the 30-year JGB yields fell one basis point each to 0.375 percent and 0.340 percent, respectively, to hit the lowest levels since August 2016. The 20-year yield stood flat at 0.245 percent, while the five-year yield fell half a basis point to minus 0.225 percent.

The Australian government bond futures inched higher, with the three-year bond contract up half a tick at 98.945. The 10-year contract firmed 1 tick to 98.5450.

The Canadian government bond prices edged lower across a flatter yield curve, with the two-year down 3.5 Canadian cents to yield 1.479 percent and the 10-year falling 6 Canadian cents to yield 1.528 percent. The 10-year yield touched its highest intraday since May 31 at 1.543 percent.

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June 27 08:00 UTC Released

DEHE State CPI YY

Actual

1.5 %

Forecast

Previous

1.4 %

June 27 08:00 UTC Released

DEHE State CPI MM

Actual

0.1 %

Forecast

Previous

0.4 %

January 31 00:00 UTC 737774737774m

ARAnnual Primary Balance*

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Forecast

2016 bln ARS

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Bln AR bln ARS

January 31 00:00 UTC 737774737774m

ARAnnual Primary Balance*

Actual

Forecast

2016 bln ARS

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Bln AR bln ARS

January 22 19:00 UTC 749594749594m

ARTrade Balance

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Forecast

Previous

-1541 %

January 31 00:00 UTC 737774737774m

ARAnnual Primary Balance*

Actual

Forecast

2016 bln ARS

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Bln AR bln ARS

January 22 19:00 UTC 749594749594m

ARTrade Balance

Actual

Forecast

Previous

-1541 %

January 31 00:00 UTC 737774737774m

ARAnnual Primary Balance*

Actual

Forecast

2016 bln ARS

Previous

Bln AR bln ARS

January 31 00:00 UTC 737774737774m

ARAnnual Primary Balance*

Actual

Forecast

2016 bln ARS

Previous

Bln AR bln ARS

January 31 00:00 UTC 737774737774m

ARAnnual Primary Balance*

Actual

Forecast

2016 bln ARS

Previous

Bln AR bln ARS

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