Market Roundup
- Trump delays tariff hike on Chinese goods, citing trade talk progress
- Trump happy if North Korea doesn't test weapons; peace deal a possibility
- U.S. Democrats seek ways to counter Trump's economic message
- Japan PM Abe's adviser says BOJ can shelve its price goal
- British PM May seeks more time: promises Brexit deal vote by March 12
- UK services industry gloomiest since 2009 crisis - CBI
- After Venezuelan troops block aid, Maduro faces 'diplomatic siege'
Economic Data Ahead
- No major economic data scheduled
Key Events Ahead
- (1100 ET/1600 GMT) Fed Vice Chairman Richard Clarida to participate in "Fed Listens: A Conversation with Community Leaders in Southern Dallas"
- (1250 ET/1715 GMT) Riksbank Governor Stefan Ingves to give his view on economic developments at an event in Uppsala, Sweden
- (1800 ET/2300 GMT) Fed Vice Chairman Richard Clarida and Dallas Fed President Robert Kaplan participates in an event in Dallas
- (1830 ET/2330 GMT) Reserve Bank of New Zealand Deputy Governor Geoff Bascand speaks at an event in Wellington
FX Beat
DXY: The dollar index consolidated within narrow ranges after the U.S. president said he would plan a summit meeting with Chinese President Xi Jinping at his Mar-a-Lago estate in Florida to conclude an agreement, assuming the trade talks make additional progress. The greenback against a basket of currencies trades 0.05 percent up at 96.44, having touched a low of 96.29 on Wednesday, its lowest since February 6. FxWirePro's Hourly Dollar Strength Index stood at -91.91 (Slightly Bullish) by 0500 GMT.
EUR/USD: The euro rose, halting a 3-day losing streak, as the greenback slightly eased after U.S. Democratic state governors said their party needs to challenge President Donald Trump's record on the economy as he seeks re-election next year. The European currency traded 0.1 percent at 1.1341, having touched a high of 1.1371 on Wednesday, its highest since Feb. 6. FxWirePro's Hourly Euro Strength Index stood at -91.91 (Slightly Bearish) by 0500 GMT. Investors’ attention will remain on U.S. wholesale inventories, Chicago Fed National Activity Index, Dallas Fed manufacturing business index and Fed Clarida’s speech, amid a lack of economic data from the Eurozone docket. Immediate resistance is located at 1.1368 (Feb.7 High), a break above targets 1.1394 (Jan. 23 High). On the downside, support is seen at 1.1309 (10-DMA), a break below could drag it till 1.1289 (Feb. 18 Low).
USD/JPY: The dollar steadied after U.S. President Donald Trump said he will delay increasing tariffs on Chinese goods on March 1, citing significant progress in trade talks. The major was trading 0.05 percent up at 110.66, having hit a high of 110.95 on Wednesday, its highest since February 14. FxWirePro's Hourly Yen Strength Index stood at -27.39 (Neutral) by 0500 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of U.S. wholesale inventories, Chicago Fed National Activity Index, Dallas Fed manufacturing business index and Fed Clarida’s speech. Immediate resistance is located at 111.05 (Feb. 13 Low), a break above targets 111.40 (Dec. 26 Low). On the downside, support is seen at 110.25 (Feb.15 Low), a break below could take it lower at 109.60 (Feb. 7 Low).
GBP/USD: Sterling surged after the European Union's Brexit negotiator, Michel Barnier, stated that he could not rule out the possibility that Britain's EU withdrawal would be pushed back. The major traded 0.1 percent up at 1.3068, having hit a high of 1.3109 on Wednesday; it’s highest since February 1. FxWirePro's Hourly Sterling Strength Index stood at 69.55 (Bullish) 0500 GMT. Immediate resistance is located at 1.3103 (Feb. 4 High), a break above could take it near 1.3160 (January 31 High). On the downside, support is seen at 1.3024 (5-DMA), a break below targets 1.2996 (21-DMA). Against the euro, the pound was trading flat at 86.77 pence, having hit a high of 86.66 on Thursday, it’s highest since Jan. 29.
AUD/USD: The Australian dollar rose, extending previous session losses, boosted by improved risk sentiment across Asian markets on hopes the United States and China will soon resolve their trade war. The Aussie trades 0.3 percent up at 0.7146, having hit a high of 0.7206 on Thursday; it’s highest since February 6. FxWirePro's Hourly Aussie Strength Index stood at 54.82 (Bullish) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7060 (Feb.8 Low), a break below targets 0.7016 (Dec. 27 Low). On the upside, resistance is located at 0.7173 (Feb. 19 High), a break above could take it near 0.7206 (Feb. 21 High).
NZD/USD: The New Zealand dollar rallied to a near 1-week peak after data showed domestic retail sales volumes rose 1.7 percent in the fourth quarter, a sharp pick up from the 0.3 percent growth seen in the previous three-month period. The Kiwi trades 0.4 percent up at 0.6867, having touched a high of 0.6852, its highest level Feb. 20. FxWirePro's Hourly Kiwi Strength Index was at 41.48 (Neutral) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6893 (Feb. 18 High), a break above could take it near 0.6941 (Feb. 1 High). On the downside, support is seen at 0.6819 (10-DMA), a break below could drag it below 0.6744 (Feb. 7 Low).
Equities Recap
Asian shares rallied to a 5-month peak after U.S. President Donald Trump confirmed he would delay a planned increase on Chinese imports as talks between the two economies made substantial progress.
MSCI's broadest index of Asia-Pacific shares outside Japan jumped 0.5 percent.
Tokyo's Nikkei surged 0.5 percent to 21,529.03 points, Australia's S&P/ASX 200 index advanced 0.3 percent to 6,186.30 points and South Korea's KOSPI rallied 0.05 percent to 2,231.69 points.
Shanghai composite index rose 4.3 percent to 2,923.90 points, while CSI300 index traded 4.4 percent up at 3,676.05 points.
Hong Kong’s Hang Seng traded 0.2 percent higher at 28,880.06 points. Taiwan shares added 0.7 percent to 10,390.93 points.
Commodities Recap
Crude oil prices declined despite Washington and China edging closer to a trade deal that dampened fears over the outlook for global economic growth. International benchmark Brent crude was trading 0.3 percent up at $66.79 per barrel by 0427 GMT, having hit a high of $67.70 on Friday, its highest since November 19. U.S. West Texas Intermediate was trading 0.2 percent lower at $57.04 a barrel, after rising as high as $57.79 on Friday, its highest since the November 16.
Gold prices surged as the greenback slightly eased after U.S. President Donald Trump said he would delay an increase in tariffs on Chinese goods as trade talks between the two nations were making progress. Spot gold was 0.3 percent up at $1,331.17 per ounce at 0438 GMT, having touched a high of $1,346.61 per ounce on Wednesday, its highest level since April 20. U.S. gold futures dipped 0.2 percent to $1,330.8 per ounce.
Treasuries Recap
The Australian government bonds jumped across the curve during Asian trading session Monday even as trade talks progressed between the United States and China, with President Donald Trump also stating an extension of the March 1 deadline, in lieu of the ongoing progress. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, plunged 2-1/2 basis points to 2.072 percent, the yield on the long-term 30-year bond slumped 2 basis points to 2.628 percent and the yield on short-term 2-year hovered around 1.727 percent.
The New Zealand government bonds eased,, sending yields about 2-4 basis points on the short-end and 5 basis points higher on the long end of the curve.
