Market Roundup
• Trump says U.S., China 'very, very close' on trade deal.
• British PM May says deal within grasp, Brexit delay won't solve crisis.
• UK opposition Labour says it will back call for second Brexit referendum.
• US Dec Wholesale Invt(y), R MM, 1.1%, 0.3% forecast.
• US Jan National Activity Index, -0.43, 0.27 previous, 0.05 revised.
• US Feb Dallas Fed Mfg Bus Index, 13.10, 1.00 previous.
• Fed's 'hotter' economy can help boost workforce, Kaplan says.
• Goldman Sachs cuts 2019 Latin American growth outlook, lowers rate forecasts.
• Oil slumps 3 percent after Trump again criticizes OPEC.
Looking Ahead - Economic Data (GMT)
• No economic data scheduled
Looking Ahead - Events, Other Releases (GMT)
• 13:30 Philadelphia Fed issues Non-manufacturing Business Outlook Survey for February.
• 14:30 Keynote speech by Yves Mersch, a member of the executive board of the ECB, at the 3rd annual conference on "FinTech and Digital Innovation: Regulation at the European Level and Beyond", organized by Afore Consulting in Brussels, Belgium.
• 15:00 Fed Chairman Jerome Powell to testify on U.S. monetary policy and the economy before the Senate Banking Committee in Washington D.C.
Currency Summaries
EUR/USD: The euro rose against US dollar on Monday, as single currency was buoyed by improved investor sentiment as expectations increased for an easing of the U.S.-China trade conflict after both sides reported progress in talks. ECB policymakers will next meet on March 7, when the bank's staff are expected to slash growth and inflation projections as the euro zone suffers its biggest slowdown in half a decade. The euro was up 0.27 percent at $1.1361. The dollar index, which measures the currency's value against a basket of six currencies, fell 0.7 percent to 96.42 .Immediate resistance can be seen at 1.1369 (23.6% retracement level), an upside break can trigger rise towards 1.1393 (100 DMA).On the downside, immediate support is seen at 1.1339 (38.2% retracement level), a break below could take the pair towards 1.1315 (50% retracement level).
GBP/USD: The pound strengthened against greenback on Monday,as traders considered whether the British government might delay Brexit if Prime Minister Theresa May fails to secure support in parliament for her withdrawal deal. Britain’s crisis over leaving the EU, scheduled to take place on March 29, is going down to the wire as May struggles to get the changes she says she needs from the bloc to get her deal passed by a divided parliament. She faces a growing risk that she will be forced to delay Brexit. The pound rose to as high as $1.3099, up 0.3 percent on the day. Immediate resistance can be seen at 1.3136 (38.2% retracement level), an upside break can trigger rise towards 1.3220 (Jan 25th high).On the downside, immediate support is seen at 1.3049 (5 DMA), a break below could take the pair towards 1.2967 (10 DMA).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Monday, as concern about global growth and lower oil price weighed on Canadian dollar. Oil futures sank more than 3 percent after U.S. President Donald Trump said OPEC should ease its approach on boosting crude prices, which he said were getting too high. At (2049 GMT), the Canadian dollar was trading 0.4 lower at 1.3188 to the greenback. Immediate resistance can be seen at 1.3193 (38.2% retracement level) , an upside break can trigger rise towards 1.3222 (23.6% retracement level).On the downside, strong support).On the downside, strong support is seen at 1.3170 (50% retracement level), a break below could take the pair towards 1.3145 (61.8% retracement level).
USD/JPY: The U.S. dollar strengthened against the yen on Monday, as risk appetite increased after U.S. President Donald Trump said he would delay a planned hike in tariffs on Chinese imports, suggesting trade negotiations between the two countries have made significant progress. The U.S. deadline set earlier for imposing higher tariffs on Chinese goods was March 1. The dollar index, which measures the currency's value against a basket of six currencies, fell 0.7 percent to 96.42 as investors bought currencies considered riskier. Strong resistance can be seen at 111.28 (38.2% retracement level), an upside break can trigger rise towards 111.50 (100 DMA).On the downside, immediate support is seen at 110.57 (50% retracement level), a break below could take the pair towards 109.86 (61.8% retracement level).
Equities Recap
U.S. President Donald Trump's decision to delay an increase in tariffs on Chinese goods drove European shares to their highest since October with carmakers, most sensitive to the threat of a global trade war, leading the rally.
UK's benchmark FTSE 100 closed up by 0.1percent, the pan-European FTSEurofirst 300 ended the day up by 0.29 percent, Germany's Dax ended up by 0.5 percent, France’s CAC finished the day up by 0.35 percent.
U.S. stocks rose on Monday after President Donald Trump said he would delay a planned hike in tariffs on Chinese imports and that the two countries were "very, very close" to a trade deal.
Dow Jones closed up by 0.21 percent, S&P 500 ended up 0.12 percent, Nasdaq finished the day up by 0.33 percent.
Treasuries Recap
U.S. Treasury yields rose on Monday as investors reduced their holdings to make room for a wave of supply and traders rolled back their safe-haven positions after U.S. President Donald Trump postponed an increase in tariffs on China.
The yield on benchmark 10-year Treasury notes was up 1.8 basis points at 2.6734 percent. Two-year Treasury notes were up 2.1 basis points at 2.5120 percent.
Benchmark 10-year Treasury yields were down 0.3 basis point at 2.740 percent after touching 2.720 percent on Wednesday, which was the lowest level since April 2.
Two-year yields retested 2.526 percent earlier Friday, which was the lowest since July 2. They were marginally lower at 2.534 percent.
Commodities Recap
Gold gained on Monday as the dollar eased on optimism that the United States and China are nearing a deal to end their trade war, while palladium set another record high on deepening supply constraints.
Spot gold was steady at $1,327.28 an ounce and U.S. gold futures settled down 0.2 percent at $1,329.5.
Oil futures sank more than 3 percent on Monday after U.S. President Donald Trump said OPEC should ease its approach on boosting crude prices, which he said were "getting too high."
After hitting their highest in over three months last week, Brent crude oil futures were down $2.06, or 3.1 percent, to $65.06 a barrel by 1:54 p.m. EST (1854 GMT) and U.S. crude fell $1.76 to $55.50 a barrel, also a 3.1 percent loss.
