Market Roundup
- British lawmakers vote to seize control of Brexit for a day
- Fed should consider holding more short-term bonds -Rosengren
- Global strain stirs BOJ debate of more easing in March
- Democrats push for Mueller report to Congress by next week, Republicans resist
- China will open further to foreign investment - premier assures global executives
- Australia's central bank confident on jobs data, eyes tax take
- New Zealand Feb Annual Trade Balance (NZD), -6.62 bln, -6.36 bln prev, -6.45 bln rvsd
Economic Data Ahead
- (0300 ET/0700 GMT) Germany Apr Gfk Consumer Sentiment, 10.8 f'cast, 10.8 prev
- (0345 ET/0745 GMT) France Q4 GDP QQ Final, 0.3% f'cast, 0.3% prev
- (0345 ET/0745 GMT) France Mar Business Climate Mfg, 103 f'cast, 103 prev
Key Events Ahead
- (0345 ET/0745 GMT) Federal Reserve Bank of Philadelphia President Patrick Harker speaks on the economic outlook in Frankfurt
- (0400 ET/0800 GMT) Riksbank executive board meeting in Stockholm
- (0700 ET/1100 GMT) BoE Deputy Governor Ben Broadbent speaks about statistics in parliament in London
- (0700 ET/1100 GMT) Riksbank Deputy Governor Cecilia Skingsley speaks in Stockholm
- (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 at event in San Francisco
FX Beat
DXY: The dollar index steadied, as the 10-year U.S. Treasury yield rose to 2.430 percent after declining to 2.377 percent on Monday, its lowest since December 2017. The greenback against a basket of currencies traded 0.1 percent up at 96.58, having touched a peak of 96.81 on Friday, its highest since Mar. 14. FxWirePro's Hourly Dollar Strength Index stood at -16.64 (Neutral) by 0500 GMT.
EUR/USD: The euro consolidated within narrow ranges, amid increasing concerns about a slowdown in the euro zone economy. On Monday, the major rebounded from a 10-day low, after German IFO Institute said it's business climate index rose to 99.6, surpassing consensus forecast of 98.5 and halting six consecutive months of decline. The European currency traded flat at 1.1310, having touched a low of 1.1273 on Friday, its lowest since Mar. 12. FxWirePro's Hourly Euro Strength Index stood at -130.55 (Highly Bearish) by 0500 GMT. Investors’ attention will remain on German Gfk consumer confidence survey, ahead of the U.S. building permits, housing starts, home price indices, and Richmond Fed manufacturing index. 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 rose, extending previous session rebound as U.S. 10-year Treasury yields edged higher. However, fears of a global economic slowdown and concerns of possible U.S. recession limited the upside in the pair. The major was trading 0.1 percent up at 110.05, having hit a low of 109.70 on Monday, its lowest since Feb. 8. FxWirePro's Hourly Yen Strength Index stood at 138.60 (Highly Bullish) by 0500 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 declined, extending prior session losses after British lawmakers voted to take control of the Brexit process from Prime Minister Theresa May for a day. Additionally, concerns over when, how and even if Britain will exit the European Union continued to dent investor sentiment. The major traded 0.1 percent down at 1.3184, having hit a low of 1.3003 on Thursday; it’s lowest since Mar. 11. FxWirePro's Hourly Sterling Strength Index stood at -78.64 (Slightly Bearish) 0500 GMT. Investors’ will remain on UK BBA Mortgage approvals, ahead of the U.S. fundamental drivers. 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 down at 85.77 pence, having hit a low of 87.22 on Thursday, it’s lowest since Feb. 22.
AUD/USD: The Australian dollar rose to a 5-day peak after RBA Assistant Governor Luci Ellis said that the central bank is confident on domestic jobs data and dismissed concerns the health of the labour market might be overstated and pointed to a range of indicators in support. The Aussie trades 0.2 percent up at 0.7124, having hit a high of 0.7168 on Thursday, it’s highest since Feb. 27. FxWirePro's Hourly Aussie Strength Index stood at 80.15 (Slightly Bearish) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7041 (Mar. 14 Low), a break below targets 0.7003 (Mar. 8 Low). On the upside, resistance is located at 0.7149 (Mar. 20 High), a break above could take it near 0.7198 (Feb. 27 High).
NZD/USD: The New Zealand dollar trimmed gains after rising to a 5-day high, as investors awaited the Reserve Bank of New Zealand's policy meeting on Wednesday, where it is considered certain to keep rates steady and reiterate its outlook for no change until 2021. The Kiwi trades flat at 0.6907, having touched a high of 0.6938 on Thursday, its highest level Feb. 1. FxWirePro's Hourly Kiwi Strength Index was at 108.93 (Highly Bullish) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6944 (Dec. 5 High), a break above could take it near 0.6969 (Dec. 4 High). On the downside, support is seen at 0.6876 (5-DMA), a break below could drag it below 0.6808 (Mar. 14 Low).
Equities Recap
Asian shares bounced back from two straight sessions of losses as U.S. 10-year Treasury yields retreated from multi-month lows.
MSCI's broadest index of Asia-Pacific shares outside Japan surged 0.3 percent.
Tokyo's Nikkei rose 2.1 percent to 21,428.44 points, Australia's S&P/ASX 200 index gained 0.1 percent to 6,130.60 points and South Korea's KOSPI rallied 0.3 percent to 2,151.50 points.
Shanghai composite index declined 1.02 percent to 3,012.44 points, while CSI300 index traded 0.7 percent down at 3,717.52 points.
Hong Kong’s Hang Seng traded 0.05 percent higher at 28,530.57 points. Taiwan shares added 0.8 percent to 10,559.20 points
Commodities Recap
Crude oil prices surged, boosted by supply cuts led by producer cartel OPEC and U.S. sanctions against Iran and Venezuela, however, signs of a sharp economic slowdown limited upside. International benchmark Brent crude was trading 0.1 percent up at $67.31 per barrel by 0454 GMT, having hit a high of $68.67 on Thursday, its highest since Nov. 13. U.S. West Texas Intermediate was trading 0.3 percent higher at $59.23 a barrel, after rising as high as $60.37 on Thursday, its highest since the Nov. 12.
Gold prices eased after rising to a near 1-month high in the previous session on possible U.S. recession and global growth concerns. Spot gold was trading 0.2 percent down at $1,319.53 per ounce by 0458 GMT, having touched a high of $1,324.40 on Monday, its highest since Feb 28. U.S. gold futures were also down 0.1 percent at $1,320.70 an ounce.
Treasuries Recap
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.
The Canadian government bond prices were higher across the yield curve. The two-year rose 8.5 Canadian cents to yield 1.488 percent and the 10-year climbed 34 Canadian cents to yield 1.558 percent. The 10-year yield, which touched its lowest intraday level since June 2017 at 1.532 percent, traded 4.4 points further below the yield on the 3-month T-bill to a spread of -9.7 basis points
