Market Roundup
- EUR/USD 0.4%, USD/JPY 0.15%, GBP/USD 0.41%, EUR/GBP 0.05%
- DXY -0.39%, DAX 1.31%, FTSE 0.02%, Brent 0.55%, Gold -0.08%
- UK's May to meet Labour leader to try to break Brexit stalemate
- Germany Mar Markit Services PMI, 55.4, 54.9 f'cast, 54.9 prev
- Germany Mar Markit Comp Final PMI, 51.4, 51.5 f'cast, 51.5 prev
- EZ Mar Markit Comp Final PMI, 51.6, 51.3 f'cast, 51.3 prev
- EZ Mar Markit Serv Final PMI, 53.3, 52.7 f'cast, 52.7 prev
- Great Britain Mar Markit/CIPS Serv PMI, 48.9, 50.9 f'cast, 51.3 prev
- EZ Feb Retail Sales YY, 2.8%, 2.3% f 'cast, 2.2% prev
- Italy Mar Markit/IHS Svcs PMI, 53.1, 50.8 f'cast, 50.4 prev
- Brent nears $70 as oil prices rise for 4th day
- BOJ keeps eye on risks even as Japan posts positive output gap
Economic Data Ahead
- (0815 ET/1215 GMT) Payrolls processor ADP releases U.S. employment report for the month of March. The report is expected to show that 170,000 jobs were added as compared with 183,000 jobs in February.
- (0945 ET/1345 GMT) Financial firm Markit releases final U.S. composite PMI for the month of March. The index posted a final reading of 54.3 in the previous month.
- (0945 ET/1345 GMT) Markit Economics reports final U.S. services PMI for the month of March. The index posted a final reading of 54.8 in the previous month.
- (1000 ET/1400 GMT) The Institute for Supply Management (ISM) is expected to report that U.S. non-manufacturing Purchasing Managers' index eased to a final reading of 58.0 in March from 59.7 in February.
- (1030 ET/1430 GMT) The Energy Information Administration (EIA) reports its Crude Oil Stocks for the week ending March 29.
Key Events Ahead
- (0830 ET/1230 GMT) French Central Bank Deputy Governor Sylvie Goulard answers Senate's questions on Brexit, Paris
- (0830 ET/1230 GMT) Federal Reserve Bank of Atlanta President Raphael Bostic, Federal Reserve Bank of Richmond President Thomas Barkin and Federal Reserve Bank of Kansas City President Esther George will participate in panel before the American Bankers' Association Washington Summit, Washington D.C.
- (1300 ET/1700 GMT) Bank of Spain Governor Hernandez de Cos participates at an event in Madrid
- (1700 ET/2100 GMT) Federal Reserve Bank of Minneapolis President Neel Kashkari participates in a Town Hall hosted by the North Dakota State University College of Business
FX Beat
DXY: The dollar index eased to a 6-week low, weighed down by yesterday's mixed U.S. economic data, showing that durable goods orders contracted by 1.6 percent in February. The greenback against a basket of currencies traded 0.3 percent down at 97.04, having touched a peak of 97.52 on Tuesday, its highest since Mar. 8. FxWirePro's Hourly Dollar Strength Index stood at -109.83 (Highly Bearish) by 1000 GMT.
EUR/USD: The euro rebounded from a 3-1/2 week low recorded in the prior session, after data showed Eurozone services PMI rose to 53.3 in March from 52.8, ahead of the flash estimate of 52.7. However, worries over the relative weakness in the euro zone economy capped the upside. The European currency traded 0.4 percent up at 1.1244, having touched a low of 1.1183 on Tuesday, its lowest since Mar. 7. FxWirePro's Hourly Euro Strength Index stood at 26.46 (Neutral) by 1000 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 surged to a 2-week peak as investor risk sentiment improved following reports of progress in trade talks between the United States and China. The major was trading 0.2 percent up at 111.50, having hit a high of 111.57 earlier, its highest since Mar. 20. FxWirePro's Hourly Yen Strength Index stood at -98.12 (Slightly Bearish) by 1000 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. Markit service PMI, and Fed official's speech. Immediate resistance is located at 111.69 (Mar. 20 High), a break above targets 111.92 (Mar. 6 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 rose towards the 1.3200 handle, after Prime Minister Theresa May announced talks with the opposition Labour party in a bid to break the Brexit deadlock, indicating Britain will end up with softer departure from the European Union. The major traded 0.3 percent up at 1.3171, having hit a low of 1.2976 on Thursday; it’s lowest since Mar. 11. FxWirePro's Hourly Sterling Strength Index stood at 121.21 (Highly Bullish) 1000 GMT. Immediate resistance is located at 1.3246 (Mar. 25 High), a break above could take it near 1.3272 (Mar. 20 High). On the downside, support is seen at 1.2976 (Mar. 29 Low), a break below targets 1.2924 (Feb. 5 Low). Against the euro, the pound was trading 0.1 percent down at 85.38 pence, having hit a high of 84.83 last week, it’s highest since Mar. 13.
USD/CHF: The Swiss franc edged higher, retreating from a near 2-week low hit in the previous session, as the greenback eased from recent peaks. The major trades 0.1 percent down at 0.9970, having touched a high of 1.0000 on Tuesday; it’s highest since Mar. 20. FxWirePro's Hourly Swiss Franc Strength Index stood at -97.00 (Slightly Bearish) by 1000 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 advanced to a near 8-month peak, boosted by robust data out of China and Europe and progress towards a trade deal between Beijing and Washington.
The pan-European STOXX 600 index rallied 0.6 percent at 387.32 points, while the FTSEurofirst 300 index rose 0.5 percent to 1,521.83 points.
Britain's FTSE 100 trades 0.05 percent up at 7,393.96 points, while mid-cap FTSE 250 gained 0.8 to 19,485.61 points.
Germany's DAX rose 1.2 percent at 11,889.84 points; France's CAC 40 trades 0.6 percent higher at 5,455.13 points.
Commodities Recap
Crude oil prices surged to near 5-month highs as support from OPEC-led supply cuts and U.S. sanctions overshadowed a report showing an unexpected rise in U.S. inventories. International benchmark Brent crude was trading 0.4 percent up at $69.70 per barrel by 1028 GMT, having hit a high of $69.94, its highest since Nov. 12. U.S. West Texas Intermediate was trading 0.2 percent up at $62.65 a barrel, after rising as high as $62.96, its highest since the Nov. 7.
Gold prices eased as safe-haven demand for the metal was dented by a risk-on sentiment, with equities rallying to 7-month highs. Spot gold declined 0.05 percent to $1,292.55 per ounce by 1038 GMT, having touched a low of $1,285.17 on Tuesday, its lowest since March 8. U.S. gold futures were flat at $1,295.50 an ounce.
Treasuries Recap
The U.S. Treasury yields climbed during European session ahead of the country’s ADP non-farm employment data for the month of March and ISM non-manufacturing PMI for the similar period, both scheduled to be released today by 17:45GMT and 19:30GMT respectively. The yield on the benchmark 10-year Treasury yield jumped nearly 4 basis points to 2.517 percent, the super-long 30-year bond yields surged nearly 3-1/2 basis points to 2.919 percent and the yield on the short-term 2-year traded nearly 3 basis points higher at 2.335 percent.
The United Kingdom’s gilts plunged during European trading session even after the country’s March services activity contracted for the first time since July 2016, posting below the 50-point threshold mark amid ongoing nervousness over Brexit agreement. The yield on the benchmark 10-year gilts, jumped 6 basis points to 1.065 percent, the super-long 30-year bond yields surged 4-1/2 basis points to 1.593 percent and the yield on the short-term 2-year traded 3-1/2 basis points higher at 0.671 percent.
The German bunds suffered during European session after the country’s services PMI for the month of March came in higher than market expectations, coupled with eurozone’s retail sales data for February, which also cheered market participants. The German 10-year bond yields, which move inversely to its price, jumped 5 basis points to 0.001 percent, the yield on 30-year note surged 5-1/2 basis points to 0.652 percent and the yield on short-term 2-year traded nearly 2 basis points higher at -0.584 percent.
The Japanese government bond yields improved at close ahead of the country’s super-long 30-year auction and household spending data for the month of February, both scheduled to be unveiled on April 4 by 03:45GMT and 23:30GMT respectively. The yield on the benchmark 10-year JGB note, which moves inversely to its price, jumped 15 basis points to -0.050 percent, the yield on the long-term 30-year hovered around 0.515 percent and the yield on short-term 2-year improved 3 basis points to -0.154 percent.
The Australian government bonds fell during Asian trading session following a better-than-expected rise in the country’s retail sales data for the month of February, released early today. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, jumped 2-1/2 basis points to 1.837 percent, the yield on the long-term 30-year bond surged nearly 3 basis points higher to 2.462 percent and the yield on short-term 2-year traded 1 basis point higher at 1.454 percent.
