Market Roundup
- U.S. pressing China to cut trade surplus by $100 bln -White House
- Japan finmin to skip G20 amid parliamentary wrangling over suspected scandal
- US NEC Kudlow – Would like to see USD “a wee bit” stronger than now
- Differences on North Korea key to Trump's Tillerson decision -sources
- Former Trump campaign manager Manafort files to dismiss charges
- Republicans sound alarm as Democrats claim Pennsylvania win
- U.S. Senate approves bill rewriting post-crisis bank rules
- New Zealand posts weaker-than-expected 0.6 pct GDP growth in Q4; 2.9 pct annual
- Britain expels 23 Russian diplomats over nerve attack on ex-spy
Economic Data Ahead
- (0345 ET/0745 GMT) France Feb CPI (EU Norm) Final, 0.0% m/m, 1.3% y/y eyed; -0.1%, 1.3% last
Key Events Ahead
- (0430 ET/0830 GMT) Swiss National Bank (SNB) monetary policy decision
- (0500 ET/0900 GMT) Norway Central Bank announces interest rate decision and Monetary Policy Report
- (0530 ET/0930 GMT) Norway Central Bank holds Press conference in Oslo
- (1045 ET/1545 GMT) ECB’s Sabine Lautenschlaeger speaks at Florence School of Banking and Finance in Florence
FX Beat
DXY: The dollar index eased as investors remain concerned about increased protectionism under U.S. President Donald Trump's administration. The greenback against a basket of currencies 0.1 percent down at 89.72, having touched a low of 89.56 on Wednesday, its lowest since Mar. 8. FxWirePro's Hourly Dollar Strength Index stood at -93.91 (Slightly Bearish) by 0500 GMT.
EUR/USD: The euro rose, after falling in the previous session on European Central Bank President Mario Draghi's dovish comments, citing that the ECB needs further evidence that inflation is rising towards its target. The European currency traded 0.1 percent up at 1.2381, having touched a high of 1.2412 on Wednesday, its highest since Mar. 8. FxWirePro's Hourly Euro Strength Index stood at -4.64 (Neutral) by 0500 GMT. Investors’ attention will remain on series of data from the Eurozone economies, ahead of U.S. unemployment claims and import and export price index. Immediate resistance is located at 1.2412 (Previous Session High), a break above targets 1.2465 (Feb 14 High). On the downside, support is seen at 1.2344 (10-DMA), a break below could drag it lower 1.2314.
USD/JPY: The dollar slumped to a 1-week low against the yen, as lingering worries about global trade tensions weighed heavily on investors' risk sentiment. The major was trading 0.4 percent down at 105.88, having hit a low of 105.78 earlier, its lowest since Mar. 7. FxWirePro's Hourly Yen Strength Index stood at 145.18 (Highly Bullish) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. unemployment claims and import and export price index. Immediate resistance is located at 107.04 (Mar 9 High), a break above targets 107.67 (Feb. 27 HIgh). On the downside, support is seen at 105.78 (Session Low), a break below could take it lower 105.25.
GBP/USD: Sterling surged, extending gains for the fifth straight session, as traders remained focused on the Bank of England policy meeting next week and a European Union leaders summit where Britain has said it will announce a deal on its relations with the EU immediately after Brexit. The major traded 0.1 percent up at 1.3972, having hit a high of 1.3995 the day before, it’s highest since Feb. 27. FxWirePro's Hourly Sterling Strength Index stood at 76.97 (Slightly Bullish) by 0500 GMT. Investors’ focus will remain on the U.S. fundamental drivers, amid a lack of data from the UK docket. Immediate resistance is located at 1.4010, a break above could take it near 1.4070. On the downside, support is seen at 1.3918 (21-DMA), a break below targets 1.3868 (10-DMA). Against the euro, the pound was trading flat at 88.55 pence, having hit a high of 88.44 pence on Wednesday, it’s highest since Mar 1.
AUD/USD: The Australian dollar eased as ongoing market woes about the growing possibility of a global trade war triggered by Trump's trade tariffs continued to drag on market sentiment. The Aussie trades 0.1 percent down at 0.7866, having hit a high of 0.7916 the day before; it’s highest since Feb. 20. FxWirePro's Hourly Aussie Strength Index stood at -41.95 (Neutral) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7848 (5-DMA), a break below targets 0.7776 (Mar 9 Low). On the upside, resistance is located at 0.7901 (Feb. 21 High), a break above could take it near 0.7988.
NZD/USD: The New Zealand dollar declined after the domestic fourth-quarter GDP data cemented bets on interest rates staying at record lows for a long time yet. The economy grew 0.6 percent last quarter, below estimates of 0.7 percent, while on annual basis it came in at 2.9 percent, just missing expectations for a robust 3.1 percent rise. The Kiwi trades 0.2 percent down at 0.7319, having touched a high of 0.7354 the day before, its highest level since Feb. 22. FxWirePro's Hourly Kiwi Strength Index was at -46.25 (Neutral) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.7354 (Mar 14 High), a break above could take it near 0.7386 (Feb 21 High). On the downside, support is seen at 0.7298 (5-DMA), a break below could drag it below 0.7270.
Equities Recap
Asian shares slumped, while the greenback eased amid mounting investor concerns that growing trade tensions would hurt the global economy.
MSCI's broadest index of Asia-Pacific shares outside Japan declined 0.5 percent.
Tokyo's Nikkei rose 0.2 percent to 21,803.95 points, Australia's S&P/ASX 200 index declined 0.3 percent to 5,920.80 points and South Korea's KOSPI surged 0.4 percent to 2,495.70 points.
Shanghai composite index fell 0.3 percent to 3,282.06 points, while CSI300 index was trading 0.3 percent up at 4,083.48 points.
Hong Kong’s Hang Seng was trading 0.5 percent lower at 31,2425.35 points. Taiwan shares added 0.2 percent to 11,018.45 points.
Commodities Recap
Crude oil prices rose, supported by healthy global demand, however, the rise in U.S. production undermined efforts led by producer cartel OPEC to cut supplies and balance markets. International benchmark Brent crude was trading 0.1 percent up at $64.90 per barrel by 0507 GMT, having hit a high of $65.81 on Monday, its highest since Mar. 6. U.S. West Texas Intermediate was trading 0.1 percent up at $61.01 a barrel, after rising as high as $62.31 on Monday, its strongest since Mar. 7.
Gold prices edged up, hovering near one-week highs hit in the previous session on political tensions between Britain and Russia and on worries over a potential trade war. Spot gold rose 0.2 percent to $1,327.62 per ounce at 0521 GMT, having hit a high of $1,329.91 an ounce on Wednesday, its highest since Mar. 7. U.S. gold futures for April delivery rose 0.1 percent to $1,327.00 per ounce.
Treasuries Recap
The 10-year U.S Treasury yield stood at 2.811 percent lower by 0.005 bps, while 5-year yield was 0.005 bps down at 2.602 percent.
The Japanese government bonds traded sideways as investors remained muted in a silent session that witnessed little data of any economic significance. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, hovered around 0.04 percent, the yield on the long-term 30-year note remained steady at 0.76 percent and the yield on short-term 2-year traded tad lower at -0.14 percent.
The Australian government bonds rallied as growing concerns among investors of trade war which would hurt the global economy pushed demand for safe-haven assets. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 2-1/2 basis points to 2.731 percent, the yield on the long-term 30-year note dipped 2 basis points to 3.310 percent and the yield on short-term 2-year down 1/2 basis points to 1.997 percent.
The New Zealand government bonds jumped at the time of closing after the country’s gross domestic product (GDP) for the fourth quarter of last year disappointed market participants, although remaining unchanged from that in the third quarter of 2017. At the time of closing, the yield on the benchmark 10-year Treasury note, which moves inversely to its price, slumped 4-1/2 basis points to 2.90 percent, the yield on 20-year also plunged 4-1/2 basis points to 3.40 percent and the yield on short-term 2-year too closed 2 basis points lower at 1.94 percent.
