Market Roundup
- EUR/USD -0.3%, USD/JPY -0.3%, GBP/USD -0.3%, DXY +0.05%
- DAX -0.5%, CAC -0.5%, FTSE -0.4%, Brent -0.5%, Gold -0.2%, Copper -0.9%
- EUR/CHF rises to 1.0722, its highest since Jan 26
- EUR dips after Juppe says won't be election candidate
- Politics 'tightening grip' on financial market behaviour - BIS
- Eurozone Mar SENTIX Index 20.7 VS previous 17.4. 18.5 forecast
- SNB domestic deposits rise to 471.479bln w/e Mar 3 from previous 470.161bln
- SNB earned CHF 1.5 bln from negative rates in 2016
- Greece turning a page, poised to show strong growth-PM
- Iron ore prices 'could drop 30pc' - Sydney Morning Herald
- North Korea fires four ballistic missiles into sea, angering Japan and South
Economic Data Ahead
- (0900 ET/1400 GMT) Mexico's statistics institute releases data on consumer prices for the month of February.
- (1000 ET/1500 GMT) The United States is likely to report that factory orders increased 1.2 percent in January, after rising 1.3 percent in the prior month.
Key Events Ahead
- (1145 ET/1645 GMT) FedTrade operation 15-yr Fannie Mae/Freddie Mac (max $450 mn)
- (1430 ET/1930 GMT) FedTrade operation 30-yr Fannie Mae/Freddie Mac (max $1.90 bn)
- (1300 ET/1800 GMT) The Reserve Bank of New Zealand Governor Graeme Wheeler's Speech
- (1500 ET/2000 GMT) Federal Reserve Bank of Minneapolis President Neel Kashkari participates in a discussion in Washington.
FX Beat
DXY: The dollar rose versus the euro after France’s Juppe said that he will not run in French presidential election race. The greenback against a basket of currencies traded 0.1 percent up at 101.60, having hit a high of 102.26 on Thursday, it’s strongest since Jan. 11. FxWirePro's Hourly Dollar Strength Index stood at 85.82 (Slightly Bullish) by 1100 GMT.
EUR/USD: The euro declined after rising to a 2-week high earlier in the session after France’s Juppe stated that he will not run in French presidential election race. Markets seem to have ignored better than expected Eurozone Sentix investor confidence figures, which came in at 20.7 in March, beating the forecast of 16.0 and previous 17.4. The European currency traded 0.3 percent down at 1.0592, having hit a high of 1.0639 earlier, it’s highest since Feb. 17. FxWirePro's Hourly Euro Strength Index stood at 55.78 (Bullish) by 1000 GMT. The further jump will happen only above 1.06800 level and any break above will take the pair till 1.07200/1.07450 level. On the lower side, major support is around 1.04900 short term low formed at Feb 22 and any break targets 1.04500/1.03400.
USD/JPY: The dollar slumped, extending previous session losses, as uncertainty around French elections and reports of 4 ballistic missiles launched by North Korea into the East Sea triggered a fresh bout of risk-off sentiment in the market. The major trades 0.3 percent lower at 113.71, pulling away from a high of 114.74 hit in the previous session, its highest since Feb. 15. FxWirePro's Hourly Yen Strength Index stood at 31.86 (Neutral) by 1000 GMT. The minor resistance is around 114.95 (Feb 15 high) and any break above will take the pair till 115.94. On the lower side minor support is around 113.25 (55- day EMA) and any break below 112 will drag it till 111.65/111.
GBP/USD: Sterling weakened as uncertainty over when the formal process for Britain's departure from the European Union would be triggered and weak economic data released last week continued to weigh on the British currency. Sterling trades 0.3 percent lower at 1.2255, having hit a low of 1.2214 the prior session, its weakest since Jan. 17. FxWirePro's Hourly Sterling Strength Index stood at -81.40 (Slightly Bearish) by 1000 GMT. On the lower side, further weakness can be seen below 1.2200 and any violation below will drag the pair down till 1.2125/1.2080. The minor intraday bullishness can happen only above 1.2300 (23.6% retracement 1.25695 and 1.2214) and any break above will take it till 1.2350 (Support turned into resistance)/ 1.2413 (200- H MA). Against the euro, the pound trades flat at 86.26 pence, having hit a 7-week low of 86.68 earlier in the session.
USD/CHF: The Swiss franc declined, as the dollar gained on growing expectations of a U.S. interest rate hike later this month. The major trades 0.23 percent higher at 1.0098, hovering towards a high of 1.0146 hit in the previous session, its strongest since Jan. 12. FxWirePro's Hourly Swiss Franc Strength Index stood at 34.71 (Neutral) by 1000 GMT. The pair has formed a temporary top around 1.01405 and any break above targets 1.0160 (61.8% retracement of 1.03436 and 0.98696)/1.0200. On the lower side, 1.00665 (23.6% retracement of 0.98695 and 1.01462) will be acting as major intraday support and any break below will drag it till 1.000/0.9965 (Feb 16th low).
AUD/USD: The Australian dollar nudged up as investors turned their attention towards the Reserve Bank of Australia’s monetary policy decision, where it is widely expected to keep rates on hold and remain neutral on the policy stance. However, board based risk-off sentiment added to the bearish bias around the major. The Aussie trades up at 0.7595, having touched a low of 0.7542 on Friday, it’s lowest since Jan. 31. FxWirePro's Hourly Aussie Strength Index stood at -102.14 (Highly Bearish) by 1100 GMT. On the lower side, the major support stands at 0.7539 (100- day EMA) and any break below will drag the pair down till 0.7520 (200- day MA)/0.74450 (Jan 13th low). The major resistance is around 0.7636 (21- day EMA) and a break above will take it till 0.7680/0.7740.
Equities Recap
European shares declined in early trade following losses in banking stocks, while geopolitical tensions in Asia triggered a wave of risk-off sentiment across the financial markets.
The pan-European STOXX 600 index decreased 0.43 percent to 373.62 points, while the FTSEurofirst 300 index eased 0.46 percent to 1,474.18 points.
Britain's FTSE 100 trades 0.32 percent lower at 7,350.44 points, while mid-cap FTSE 250 shed 0.17 percent to 18,850.17 points.
Germany's DAX edged down 0.58 percent at 11,958.36 points; France's CAC 40 trades 0.49 percent lower at 4,971.44 points.
Tokyo's Nikkei eased 0.46 percent to 19,379.14 points, Australia's S&P/ASX 200 index rose 0.29 percent to 5,749.40 points and South Korea's KOSPI gained 0.53 percent to 2,102.65 points.
Shanghai composite index advanced 0.5 percent to 3,233.87 points, while CSI300 index climbed 0.5 percent to 3,446.48 points. Hong Kong’s Hang Seng added 0.2 percent to 23,596.28 points.
Commodities Recap
Crude oil prices declined, giving up some of the previous session gains amid concerns lower growth targets in China could reduce oil demand and worries over Russia's compliance with a global deal to cut oil output. International benchmark Brent crude was trading 0.4 percent down at $55.53 per barrel by 0940 GMT, having hit a low of $55.01 on Thursday, its lowest since Feb. 8. U.S. West Texas Intermediate crude fell 0.5 percent at $52.91 a barrel, after tumbling to a trough of $52.52 last week, its weakest since Feb. 9.
Gold prices edged down, having tumbled to a 2-week low in the previous session as rising geopolitical tensions over North Korea and a weaker dollar boosted the metal's safe-haven appeal. Spot gold eased 0.1 percent to $1,233.80 per ounce at 0944 GMT, having hit a low of $1,222.72, the lowest since Feb. 15 on Friday. U.S. gold futures rose 0.6 percent, to $1,233.2.
Treasuries Recap
The U.S. Treasuries jumped despite Federal Reserve Chair Janet Yellen delivering hawkish comments, confirming that the Fed is set to hike at the upcoming meeting ending on March 15. The yield on the benchmark 10-year Treasury slumped 2-1/2 basis points to 2.46 percent, the super-long 30-year bond yield also plunged 2-1/2 basis points to 3.05 percent and the yield on short-term 2-year note traded nearly 1 basis point lower at 1.29 percent.
The UK 10-year gilt yields hit near 2-week low, as investors sought refuge in safe-haven assets after the country’s Finance Minister Philip Hammond delivered comments over the ongoing Brexit negotiations. The yield on the benchmark 10-year gilts, plunged 3-1/2 basis points to 1.15 percent, the super-long 30-year bond yields slumped 2-1/2 basis points to 1.76 percent and the yield on the short-term 2-year traded lower by nearly 1 basis point at 0.08 percent.
The German government bunds jumped sharply ahead of the Eurozone’s fourth-quarter gross domestic product (GDP) and the European Central Bank’s (ECB) monetary policy decision scheduled to be held on March 7 and 9 respectively. The yield on the benchmark 10-year bond slumped nearly 3 basis points to 0.32 percent, the long-term 30-year bond yields plunged 4-1/2 basis points to 1.10 percent while the yield on short-term 2-year bond moved lower by nearly 1-1/2 basis points to -0.81 percent.
The Japanese government bonds traded narrowly mixed as investors wait to watch the super-long 30-year auction, scheduled to be held on Tuesday. The benchmark 10-year bond yield, rose 1/2 basis point to 0.08 percent, while the long-term 30-year bond yields fell nearly 1 basis point to 0.84 percent while the yield on the short-term 2-year note traded 1/2 basis point lower at -0.28 percent.
The New Zealand government bonds traded a tad higher as investors covered previous short positions. The yield on the benchmark 10-year bond, fell 1 basis point to 3.32 percent at the time of closing, the yield on 7-year note pushed lower by nearly 1 basis point to 2.88 percent and the yield on short-term 2-year note also traded 1 basis point lower at 2.19 percent.
The Australian bonds gained modestly ahead of the Reserve Bank of Australia’s (RBA) monetary policy decision, scheduled to be held on March 7. The yield on the benchmark 10-year Treasury note, slipped nearly 1 basis point to 2.81 percent, the yield on 15-year note also fell nearly 1-1/2 basis points to 3.23 percent while the yield on short-term 2-year traded nearly 1/2 basis point lower at 1.84 percent.
