Market Roundup
- EUR/USD +0.13%, USD/JPY -0.02%, GBP/USD -0.02%, AUD/USD +0.06%
- Brent -1.6%, DAX -0.3%, Nikkei +0.19%, DXY -0.13%, Gold +0.15%
- Germany Mar Prod. Prices -3.1% y/y vs -3.0% previous, -2.9% exp
- UK Feb ILO Jobless Rate 5.1% vs 5.1% previous, 5.1% exp
- UK Feb Avg Earnings 3mth y/y 1.8% vs 2.1% previous, 2.3% exp
- UK Feb Avg Earnings Ex-Bonus 2.2% vs 2.2% previous, 2.2% exp
- Switzerland Apr ZEW 11.5 vs 2.5 previous
- BoJ Gov Kuroda (in Diet) – Closely watching market moves
- Japan PM Abe unlikely to call snap election due to quakes – Sankei
- Japanese govt could consider raising sales tax 1% at a time – Nikkei
- Japan Asahi reaches mega-E2.6 bln deal in Europe, pulls US bid – Nikkei
Economic Data Preview
- (0830 ET/1230 GMT) Canada's wholesale trade, released by the Statistics Canada is expected to have edged down 0.3 percent in February after staying flat in the prior month.
- (1000 ET/1400 GMT) The National Association of Realtors is likely to report that the U.S. existing home sales have gained 3.5 percent in the month of March, to an annual rate of 5.30 million units. While sales declined 7.1 percent to an annual rate of 5.08 million units in February.
- (1030 ET/1430 GMT) The Energy Information Administration reports its Crude Oil Stocks for the week ending April 15.
- (1950 ET/2350 GMT) Japan's Ministry of Finance will report foreign bond investment for the week ending April 15.
Key Events
- (1145 ET/1545 GMT) FedTrade Ops 30-yr F.Mae/Fr.Mac max $2.100 bln
- N/A Bank of Canada Governor Stephen Poloz and Senior Deputy Governor Carolyn Wilkins are scheduled to speak before the Senate Standing Committee on Banking, Trade and Commerce.
FX Beat
USD: The dollar gained against the commodity currencies after oil workers in Kuwait halted a 3-day strike. Against a basket of currencies, the dollar index was 0.1 percent down at 94.002.
EUR/USD: The euro trades 0.1 percent higher at 1.1378, with options markets showing speculative activity ahead of ECB meeting on Thursday was far more subdued than the run-in to recent policy decisions. The pair has broken major resistance 1.1380 and jumped till 1.1384. On the lower side minor intraday support is around 1.1270 and any violation below that level will drag the pair to next level 1.1230/1.1180 level. Further weakness can be seen below 1.1150. Break below 1.1150 will take it till 1.1050 level. The major is facing resistance around 1.1460 level and any violation above this level will reach till 1.1500/1.1545.
USD/JPY: The Japanese yen trades flat at 109.18 yen against its U.S counterpart, pulling away from a high of 107.83, struck on Monday. The short term trend is slightly bullish as long as support 108.75 holds. On the lower side any break below 108.75 will drag the pair down till 108/107.60. The major resistance is around 110 and break above targets 111.25/112, while the minor resistance is around 109.25
GBP/USD: Sterling slipped after the economy's unemployment rose while wage growth fell short of expectations, suggesting that recent growth in the labor market was easing off. The number of unemployed people in Britain rose by 21,000 in the three months to February, the first increase since the May-July period of last year. The unemployment rate was steady at 5.1 percent in the three months to February. Sterling fell to a low of 1.4345 after the data, having touched session's high of 1.4407 beforehand. It trades around 1.4374, still weaker on the day and off a 3-week high of 1.4418 struck in the previous session. Against the euro it trades around 79.09 pence. Minor trend is slightly bullish as long as support 1.4350 (7 day EMA) holds. Any break below 1.4350 will drag the pair to next level till 1.4300/1.4260. On the higher side major resistance is around 1.4430 and break above targets 1.4460/1.45150 in short term. Overall bullish invalidation is only below 1.4000.
USD/CHF: The Swiss franc extended gains against the U.S. dollar, trading 0.1 percent higher at 0.9606. The short term trend is slightly bearish as long as resistance 0.9700 holds.On the lower side break below 0.9580 will drag the pair down till 0.9525/0.9480. The resistance is at 0.9700 and break above will take it to next level at 0.9750/0.9800. The minor resistance is around 0.9660. Overall bearish invalidation can happen only above 0.9800.
AUD/USD: The Australian dollar edged up to 0.7823 after it falling down to a low of 0.7766 as investors opted to book profits. The Aussie trades around 0.7816, hovering towards previous session high of 0.7826, a high not seen since June. It is up nearly 7 percent this year. The short term trend is slightly bullish as long as support 0.7740 holds. On the higher side major resistance is around 0.7850 and break above targets 0.7915/0.7950. The major support is around 0.7740 and break below will drag the pair till 0.7700/0.7680/0.7630.
NZD/USD: The New Zealand dollar declined to 0.7015, pulling away from a 10-month peak of 0.7053 on Tuesday. The kiwi recovered from a low of 0.6992, to trade around its current level. It was up two cents since Monday, as global dairy price rose for the second consecutive auctions. Immediate support is located at 0.6952 (5-DMA), while on the upside, resistance is seen at 0.7053 (Previous Session High).
Equities Recap
European shares skidded after a strike by Kuwaiti oil workers ended, sending oil prices tumbling down.
Europe's FTSEurofirst 300 index declined 0.3 percent, Britain's FTSE 100 was 0.2 pct down, Germany's DAX dropped 0.3 pct, France's CAC 40 nudged down 0.4 pct.
Tokyo's Nikkei gained 0.19 pct at 16,906.54. The MSCI World Index slipped 0.1 percent, while the MSCI Emerging Market index dropped 0.7 percent.
Shanghai composite index slumped 2.3 pct at 2,972.58 points, while CSI300 index lost 1.8 pct at 3,181.03 points. HK’s Hang Seng index edged down 0.9 pct at 21,236.31 points.
Commodities Recap
Oil prices dropped as investor focus returned to worries about oversupply after Kuwaiti workers ended a three-day strike that cut the nation's crude output by around half. Brent futures were down at $43.37 a barrel at 1056 GMT. U.S. crude was down 98 cents, or more than 2 percent, at $40.10, after dipping below $40.
Gold eased as a firmer dollar halted the previous day's rally. The spot gold price was down 0.2 percent at $1,247.52 an ounce at 1057 GMT, while U.S. gold futures for April delivery were down $3.60 an ounce at $1,250.70.
Treasuries Recap
The 10-year U.S. treasury yield stood at 1.765 percent versus previous close of 1.783 percent.
Euro zone bond yields were broadly lower as oil prices declined after Kuwaiti oil workers ended a 3-day strike that halved the nation's crude output. Germany's 10-year Bund yield fell 3 basis points to 0.15 percent, within sight of a one-year low hit earlier this month at 0.075 percent. Other euro zone bond yields were 2-3 bps lower.
Japanese government bonds rose, strengthened by expectations of additional BoJ easing steps. The 10-year JGB yield edged half a basis point lower to minus 0.135 percent, matching a record set late last month. The 30-year JGB yield dropped 4.5 basis points to a record low of 0.285 percent, while the 40-year yield fell 5.5 basis points to a record 0.300 percent. The 20-year yield fell 2.5 basis points to 0.250 percent, a record low. The 10-year JGB future contract ended up 0.06 point at 152.06.
Gilts opened 29 ticks higher than the settlement of 120.30 as core fixed income markets drew support from a decline in oil prices.
Australian government bond futures were quiet, with the 3-year bond contract steady at 98.030. The 10-year contract rose 2 ticks to 97.4600, while the 20-year contract was flat at 96.8850.New Zealand government bonds eased, sending yields 3 basis points higher at the long end of the curve.
