Market Roundup
- New Zealand posts strong Q1 job growth, central bank seen remaining on hold.
- Brussels hoists gross Brexit ‘bill’ to Eur100bn.
- Marine Le Pen says French people will have francs in their pocket instead of euros within two years - The Independent (UK).
- Taiwan central bank says it would not intervene if massive foreign fund inflows continue.
- Taiwan central bank says monetary policy remains loose.
- Taiwan central bank says sees currency volatility as "unavoidable".
- Philippines' congress panel voted to reject Regina Lopez as environment minister - Panel member.
Economic Data Ahead
- (0400 ET/0800 GMT) Germany Unemployment Total SA mln Apr 2.56 previous.
- (0400 ET/0800 GMT) Germany Unemployment Rate SA % Apr 5.80 previous.
- (0400 ET/0800 GMT) Germany Unemployment Total NSA mln Apr 2.66 previous.
- (0400 ET/0800 GMT) Germany Unemployment Chg SA k Apr -30.00 previous.
- (0430 ET/0830 GMT) UK Markit/CIPS Cons PMI Apr 52.20 previous.
- (0500 ET/0900 GMT) EZ GDP Flash Prelim YY % Q1 1.70 previous.
- (0500 ET/0900 GMT) EZ Producer Prices YY % Mar 4.50 previous.
- (0500 ET/0900 GMT) EZ Producer Prices MM % Mar 0.00 previous.
- (0500 ET/0900 GMT) EZ GDP Flash Prelim QQ % Q1 0.40 previous.
Key Events Ahead
- (0845 ET/1245 GMT) ECB Non Monetary Policy Committee Meeting.
- (0530 ET/0930 GMT) Germany 10y 3.0b 0.250% 15/02/27 TAP.
FX Recap
USD: The U.S. dollar index against a basket of major currencies was effectively flat at 98.97 after posting a small gain overnight.
EUR/USD: The euro inched up 0.1 percent to $1.0934, trading within sight of a 5-1/2 month high of $1.0951 scaled last week. Pair made intraday high at 1.0936 and low at 1.0924. A sustained close above 1.0931 is required to take the parity up towards 1.1142 marks. Alternatively, reversal from key resistance will drag the parity down towards 1.0710 marks.
USD/JPY: The Japanese markets closed for a public holiday on Wednesday and the rest of the week, market liquidity is likely to be thinner than usual. The dollar last traded at 112.04 yen, not very far from Tuesday's peak of 112.33 yen, the greenback's strongest level since March 21. Pair made intraday high at 112.09 and low at 111.96 levels. A sustained close above 112.00 is required to take the parity higher towards 113.72, 115.37 and 117.42 marks. Alternatively, a daily close below 112.00 will drag the parity down towards 108.13 levels.
GBP/USD: The sterling strengthened to the day's high of $1.2915, up from $1.2888 beforehand, before easing back to around $1.2896, up 0.1 percent on the day. Against the euro, it recovered earlier losses to trade at 84.64 pence, flat on the day. Immediate resistance was seen at 1.2947 marks while support was seen at 1.2864 marks.
AUD/USD: The Australian dollar erases previous gain against U.S. dollar on Wednesday as RBA kept the cash rate steady at 1.5 percent. Pair made intraday high at 0.75 and low at 0.7500 marks. Intraday bias remains bearish till the time pair holds key resistance at 0.7555 marks. Key support was seen at 0.7467.
NZD/USD: The New Zealand dollar rose on Wednesday after a strong jobs report reinforced a steady interest rate outlook for the months ahead, while the Australian dollar drifted lower. The New Zealand dollar edged up to $0.6950, from $0.6937 early, pulling further away from a 10-month trough of $0.6847 touched last week. It is up 1.2 percent so far this week and a break above solid resistance at $0.6970 would test April's summit of $0.7011.
Equities Recap
Japanese banks will be closed in observance of Constitution Day.
Australia’s S&P ASX200 was trading 1.03 percent lower at 5,888 points.
Shanghai composite index to open down 0.2 pct at 3,138.31 points and China's CSI300 index to open down 0.1 pct at 3,421.76 points.
Taiwan’s market was trading 0.10 percent higher at 9,951.93 points.
India’s NSE Nifty was trading around 0.09 percent higher at 9,322.28 points and BSE Sensex was trading at 0.12 percent higher at 29,954.33 points.
Commodities Recap
Crude oil prices bounced back on Wednesday as a decline in U.S. inventories underpinned the market, although a dip in compliance with OPEC efforts to reduce output and near record supplies capped gains. The benchmark for global oil market, Brent futures gained 56 cents, or 1.1 percent to $51.02 a barrel by 0156 GMT. U.S. West Texas Intermediate crude rose 48 cents, or 1 percent, to $48.14 a barrel. On Tuesday, WTI slid 2.4 percent to its lowest close since March 21 and Brent closed at its lowest level this year, erasing all of the gains made since OPEC agreed to reduce production in November.
Gold held on Wednesday near a three-week low hit in the previous session on rising equities and a firmer dollar as markets waited for cues on an U.S. interest rate hike from the Federal Reserve later in the day. Spot gold was down 50 cents at $1,256.29 per ounce, as of 0048 GMT. Bullion on Tuesday hit $1,251.37 per ounce, its lowest since April 10. U.S. gold futures were little changed at $1,257.20 an ounce.
Treasuries Recap
Australian government bond futures rose, with the three-year bond contract up 1 tick to 98.150. The 10-year contract edged up 1.5 tick to 97.3800, while the 20-year contract unchanged at 97.7850.
New Zealand government bonds gained, sending yields as much as 3.5 basis points higher along the curve.
