Europe Roundup: Sterling dips as coronavirus fears rattle nerves ,European share slide 3%, Gold rises, Oil prices on track for biggest weekly fall in four years-February 28th,2020

Market Roundup

• French Jan Consumer Spending (MoM)  -1.1%,0.1% forecast, -0.3%previous

 • French CPI (MoM)   0.0%,0.0% forecast, -0.4% previous    

• French GDP (QoQ) (Q4) -0.1%,-0.1% forecast, 0.3% previous

• German Feb Unemployment Change  -10K, 3K forecast, -4K previous

• German Feb Unemployment Rate  5.0%, 5.0% forecast, 5.0% previous    

• German Feb Unemployment  2.262M, 2.272M previous

• Italian Feb CPI (MoM)  0.0%,0.1%    previous    

• Portuguese GDP (QoQ) (Q4) 0.7%,0.6%     forecast, 0.3% previous    

• Portuguese GDP (YoY) (Q4) 2.2%,2.2% forecast, 1.9% previous

Looking Ahead - Economic Data (GMT)    

• US Jan Core PCE Price Index (MoM)  0.2% forecast,0.2% previous

• US Jan Core PCE Price Index (YoY)  1.7%forecast, 1.6% previous    

• US Jan Goods Trade Balance  -68.67B previous

• US Jan PCE Price index (YoY) 1.6 previous

• US Jan  PCE price index (MoM)  0.3% previous    

• Canada GDP Implicit Price (QoQ) (Q4) 0.30%,0.10% previous

• Canada Dec GDP (MoM)  0.1%    , 0.1% previous

• Canada GDP (QoQ) (Q4) 0.3% previous    

• US Feb Chicago PMI  45.9, 42.9 previous

• US Feb Michigan 5-Year Inflation
Expectations 2.50% previous

• US Feb Michigan Consumer Expectations 92.6 forecast, 90.5 previous

• US Feb Michigan Consumer Sentiment  100.9 forecast, 99.8 previous

• US Jan  Dallas Fed PCE  1.70% previous            
Looking Ahead - Economic events and other releases (GMT)

• 14:15  US FOMC Member Bullard Speech

Fx Beat    

EUR/USD: The euro dipped  dollar on Friday as fears about an imminent pandemic that could weigh heavily on global growth. Four European Central Bank policymakers played down the prospect of immediate action to counter the economic impact of the virus, saying it was too early to gauge the long-term implications of the disease. The euro was last down 0.11% at $1.0988 . Immediate resistance can be seen at 1.1026 (50 DMA), an upside break can trigger rise towards 1.1050 (100 DMA).On the downside, immediate support is seen at 1.0920 (5 DMA), a break below could take the pair towards 1.0900 (Psychological level).

GBP/USD:  Sterling dipped against dollar on as worries about the fast-spreading coronavirus sent investors out of currencies deemed riskier. The pound has lost 2.5% versus the dollar this month and almost 2% against the euro as investors fret about Britain's negotiations with the European Union over a trade deal and whether a UK budget next week will include much more spending, which many investors say is necessary to boost economic growth. Sterling last traded at $1.2880  , slightly lower on the day, while it lost 0.4% against the euro at 85.70 pence - its weakest since mid-January. Immediate resistance can be seen at 1.2929 (9 DMA), an upside break can trigger rise towards 1.298 8(30 DMA).On the downside, immediate support is seen at 1.2837(Lower BB), a break below could take the pair towards 1.2800 (Psychological level).

USD/CHF: The dollar dipped against the Swiss franc on Friday as mounting fears the world was on the cusp of a pandemic sent global financial markets into a tailspin. Hopes the coronavirus outbreak could be contained in China have vanished this week as infections spread around the globe. At (GMT 12:29), Greenback dipped 0.78% versus the Swiss franc to 0.9689. Immediate resistance can be seen at 0.9666 (Daily high), an upside break can trigger rise towards 0.9734 (50 DMA).On the downside, immediate support is seen at 0.9610 (Daily low low), a break below could take the pair towards 0.9600 (Psychological level).

USD/JPY: The dollar declined against the Japanese yen on Friday as investors ditched risky assets on fears the coronavirus would become a pandemic and trigger a global recession. Hopes that the epidemic that started in China would be over in a few months and economic activity would return to normal have been shattered, as new infections reported around the world now surpass those in China. The yen rose 0.7% to a month-high of 108.85 per dollar on Friday, leaving the greenback down 2.4% for the week, its biggest loss on the Japanese currency in more than three years. Strong resistance can be seen at 109.88 (5 DMA), an upside break can trigger rise towards 109.55 (50 DMA).On the downside, immediate support is seen at 108.49 (Daily low), a break below could take the pair towards 108.00  (Psychological level). 

Equities Recap

European shares dove 3% on Friday, sliding deeper into correction territory, as investors feared a global recession is on the horizon with the coronavirus spreading across the world.    

At (GMT 13:07),UK's benchmark FTSE 100 was last trading lower at 3.22 percent, Germany's Dax was down by 3.41 percent, France’s CAC was last down by 2.81 percent.

Commodities Recap

Gold prices inched higher on Friday as worries intensified that the rapidly spreading coronavirus could turn into a pandemic and derail global economic growth. 

Spot gold  gained 0.2% to $1,645.79 per ounce by 0055 GMT, and was up about 0.1% for the week.

Oil prices slumped to their lowest in more than a year on Friday and were set for their steepest weekly fall in four years as the global spread of the coronavirus stokes demand fears.

Brent crude contract for May   was down $1.74, or 3.3%, at $49.99 a barrel by 0959, its lowest since July 2017.

West Texas Intermediate (WTI) crude futures fell $1.89, or about 4%, to $45.20. U.S. crude has fallen about 15% this week, representing the sharpest weekly decline since December 2008.

Treasuries Recap

U.S.: The U.S. Treasuries surged during Friday’s evening session ahead of the country’s personal consumption expenditure and personal spending index for the month of January, scheduled to be released today by 13:30GMT. Also, FOMC member Bullard is due to deliver a speech later today, which shall add further direction to the debt market. The yield on the benchmark 10-year Treasury yield plunged 9 basis points to 1.209 percent, the super-long 30-year bond yield slumped nearly 6 basis points to trade at 1.726 percent and the yield on the short-term 2-year lost nearly 12 basis points to 0.986 percent.

UK: The United Kingdom’s gilts surged during European trading hours Friday amid a muted trading session that witnessed data of little economic significance. The yield on the benchmark 10-year gilts, plunged 4 basis points to 0.430 percent, the 30-year yield also suffered 2-1/2 basis points to 0.921 percent and the yield on the short-term 2-year lost nearly 4 basis points to 0.294 percent.

EUR: The German bunds jumped during afternoon session of the last trading day of the week Friday even as the country’s employment report for the month of February cheered market investors ahead of the eurozone’s consumer price inflation (CPI) for the similar period, scheduled to be released by early next week. The German 10-year bond yield, which move inversely to its price, slumped 4-1/2 basis points to -0.601 percent, the long-term 30-year yield plunged 6 basis points to -0.129 percent and the yield on short-term 2-year suffered 3-1/2 basis points to trade at -0.774 percent.