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Europe Roundup: Sterling rebounds amid ongoing Brexit talks, euro gains as EZ investor morale improve, European shares ease - Monday, April 8th, 2019

Market Roundup

  • EUR/USD 0.24%, USD/JPY -0.25%, GBP/USD 0.06%, EUR/GBP 0.15%
     
  • DXY -0.18%, DAX -0.41%, FTSE -0.11%, Brent 0.6%, Gold 0.45%
     
  • Germany Feb Trade Balance, EUR, SA, 18.7 bln, 18.0 bln f'cast, 18.5 bln prev, 18.6 bln r'vsd
     
  • Germany Feb Exports MM SA, -1.3%, -0.5% f'cast, 0.0% prev
     
  • Germany Feb Imports MM SA, -1.6%, -0.7% f'cast, 1.5% prev
     
  • EZ Apr Sentix Index, -0.3, -2.1 f'cast, -2.2 prev
     
  • British voters say: Give us a strong leader and reform the Brexit-fatigued system
     
  • Italy to hike 2020 deficit goal to around 2.1 percent -sources
     
  • Saudi Arabia says May will be key to decide on extending oil supply cuts
     
  • BOJ offers bleakest view in 6 years on Japan's regions
     
  • China to relax residency curbs, boost infrastructure in new urbanisation push
     

Economic Data Ahead

  • (0815 ET/1215 GMT) Canadian Mortgage and Housing Corp will report housing starts for the month of March. The indicator stood at a seasonally adjusted annualized rate of 173,100 units in the previous month.
     
  • (0830 ET/1230 GMT) Statistics Canada is likely to report that building permits increased 0.2 percent in February after falling 5.5 percent in January.
     
  • (1000 ET/1400 GMT) The United States is likely to report that factory orders decreased 0.6 percent in February after posting a rise of 0.1 percent in the prior month.
     

Key Events Ahead

  • (0845 ET/1245 GMT) ECB's Andrea Enria chairing panel at a Banque de France conference in Paris, France
     
  • (1000 ET/1400 GMT) Federal Reserve board holds an open meeting, Washington
     
  • (1200 ET/1600 GMT) Bank of France Governor Francois Villeroy de Galhau speaks at a competition conference at the French central bank
     

FX Beat

DXY: The dollar index plunged, as President Donald Trump urged the central bank to cut interest rates. The greenback against a basket of currencies traded 0.2 percent down at 97.20, having touched a peak of 97.52 on Tuesday, its highest since Mar. 8. FxWirePro's Hourly Dollar Strength Index stood at 2.88 (Neutral) by 1100 GMT.

EUR/USD: The euro rose after data showed investor morale in the euro zone improved in April to hit its highest level since November, boosted by signs of an upswing in China. The European currency traded 0.3 percent up at 1.1249, having touched a low of 1.1183 on Tuesday, its lowest since Mar. 7. FxWirePro's Hourly Euro Strength Index stood at 111.85 (Highly Bullish) by 1100 GMT. Immediate resistance is located at 1.1285 (Mar. 28 High), a break above targets 1.1331 (Mar. 25 High). On the downside, support is seen at 1.1176 (Mar. 7 Low)., a break below could drag it till 1.1155.

USD/JPY: The dollar slumped, after rising for three straight sessions, as moderation in wage gains supported the Federal Reserve's decision to suspend further interest rate rises this year. The major was trading 0.2 percent down at 111.44, having hit a high of 111.82 on Friday, its highest since Mar. 15. FxWirePro's Hourly Yen Strength Index stood at -48.87 (Neutral) by 1100 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. factory orders. Immediate resistance is located at 111.92 (Mar. 6 High), a break above targets 112.13 (Mar. 5 High). On the downside, support is seen at 111.06 (Mar. 13 Low), a break below could take it lower at 110.74 (Mar. 8 Low).

GBP/USD: Sterling rebounded from a 1-week low touched in the previous session after Bank of England data showed the British public's expectations for the level of inflation over the coming year remained at their highest in five years. The major traded 0.1 percent up at 1.3050, having hit a low of 1.2986 on Friday; it’s lowest since Mar. 29. FxWirePro's Hourly Sterling Strength Index stood at -76.56 (Slightly Bearish) 1100 GMT. Immediate resistance is located at 1.3149 (Apr. 1 High), a break above could take it near 1.3227 (Mar. 21 High). On the downside, support is seen at 1.3003 (Mar. 21 Low), a break below targets 1.2976 (Mar. 29 Low). Against the euro, the pound was trading 0.2 percent down at 86.18 pence, having hit a low of 86.36 on Friday, it’s lowest since Mar. 29.

USD/CHF: The Swiss franc rose, hovering away from a near 3-week low hit in the prior session, as the greenback eased following a drop in the U.S. Treasury yields. The major trades 0.05 percent down at 0.9995, having touched a high of 1.0012 on Friday; it’s highest since Mar. 19. FxWirePro's Hourly Swiss Franc Strength Index stood at 13.79 (Neutral) by 1100 GMT. On the higher side, near-term resistance is around 1.0024 (Feb. 22 High) and any break above will take the pair to next level till 1.0052 (Mar. 15 High). The near-term support is around 0.9937 (Mar. 28 Low), and any close below that level will drag it till 0.9895 (Jan.17 Low).

Equities Recap

European shares declined, weighed down by losses in technology stocks, while sterling rebounded amid ongoing Brexit talks between Prime Minister Theresa May and the opposition Labour Party.

The pan-European STOXX 600 index eased 0.05 percent at 388.02 points, while the FTSEurofirst 300 index rallied 0.05 percent to 1,526.88 points.

Britain's FTSE 100 trades 0.1 percent up at 7,456.21 points, while mid-cap FTSE 250 fell 0.05 to 19,532.90 points.

Germany's DAX declined 0.3 percent at 11,969.96 points; France's CAC 40 trades 0.1 percent higher at 5,479.73 points.

Commodities Recap

Crude oil prices surged to their highest level since November 2018, boosted by OPEC supply cuts, U.S. sanctions against Iran and Venezuela and fighting in Libya. International benchmark Brent crude was trading 0.5 percent up at $70.74 per barrel by 1047 GMT, having hit a high of $70.83, its highest since Nov. 12. U.S. West Texas Intermediate was trading 0.3 percent up at $63.41 a barrel, after rising as high as $63.51, its highest since the Nov. 5.

Gold prices rose to a more-than-one-week peak as the greenback eased after data showed U.S. wage growth slowed last month, while investors awaited minutes of the U.S. Federal Reserve's March meeting later this week. Spot gold gained 0.5 percent to $1,297.20 per ounce by 1051 GMT, having touched a high of $1,297.87, its highest since Mar. 29. U.S. gold futures were also up 0.4 percent at $1,301 an ounce.

Treasuries Recap

The U.S. Treasury yields remained narrowly mixed during European session amid a light economic diary this week. However, later today, markets are scheduled to receive the February factory orders, followed by the JOLTS labour market data for February and the NFIB small business survey for March. The yield on the benchmark 10-year Treasury yield remained tad higher at 2.503 percent, the super-long 30-year bond yields remained flat at 2.913 percent and the yield on the short-term 2-year traded tad lower at 2.341 percent.

The United Kingdom’s gilts remained steady amid a silent trading session that witnessed data of little economic significance ahead of the country’s 10-year auction and manufacturing production for the month of February, scheduled to be released on April 9 and 10 by 09:45GMT and 08:30GMT respectively. The yield on the benchmark 10-year gilts, hovered around 1.115 percent, the super-long 30-year bond yields remained flat at 1.656 percent and the yield on the short-term 2-year traded tad lower at 0.715 percent.

The German bunds remained flat during European trading session even as the country’s trade balance data for the month of February came in better than market expectations ahead of the European Central Bank’s (ECB) monetary policy meeting, scheduled to be held on April 10 by 11:45GMT, which shall provide further direction to the debt market. The German 10-year bond yields, which move inversely to its price, remained flat at 0.001 percent, the yield on 30-year note slipped 1 percent to 0.628 percent and the yield on short-term 2-year hovered around -0.574 percent.

The Japanese government bond yields closed lower after investors shifted away from riskier assets towards safe-haven counterparts as Tokyo shares declined amid a regular debt-purchasing operation conducted by the Bank of Japan (BoJ) that gave a further lift to the market. The yield on the benchmark 10-year JGB note, which moves inversely to its price, slumped 4-1/2 basis points to -0.046 percent, the yield on the long-term 30-year slipped 1 basis point to 0.534 percent and the yield on short-term 2-year plunged 16 basis points to -0.159 percent.

The Australian government bonds jumped on the first trading day of the week amid a muted session that witnessed data of little economic significance ahead of the Reserve Bank of Australia’s (RBA) Financial Stability Review, scheduled to be released by end of this trading week, which shall provide further direction to the debt market. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, slumped 3-1/2 basis points to 1.867 percent, the yield on the long-term 30-year bond also plunged 3-1/2 basis points higher to 2.491 percent and the yield on short-term 2-year too traded nearly 3-1/2 basis points lower at 1.478 percent.

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2019-05-27 02:34:53
0m

May 27 01:30 UTC Released

CNSales Turnover

Actual

-3.7 Percent

Forecast

Previous

13.9 Percent

May 27 01:30 UTC Released

CNTurnover/sales cum Y/Y

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-3.4 Percent

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-3.3 Percent

January 31 00:00 UTC 692893692893m

ARAnnual Primary Balance*

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2016 bln ARS

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2016 bln ARS

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January 22 19:00 UTC 704713704713m

ARTrade Balance

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-1541 %

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2016 bln ARS

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Bln AR bln ARS

January 22 19:00 UTC 704713704713m

ARTrade Balance

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-1541 %

January 31 00:00 UTC 692893692893m

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2016 bln ARS

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Bln AR bln ARS

January 31 00:00 UTC 692893692893m

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2016 bln ARS

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Bln AR bln ARS

January 31 00:00 UTC 692893692893m

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2016 bln ARS

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