Market Roundup
- EUR/USD 0.03%, USD/JPY -0.19%, GBP/USD -0.33%, EUR/GBP 0.4%
- DXY 0.19%, DAX 0.64%, FTSE 0.76%, Brent -0.37%, Gold -0.16%
- Brexit: DUP leader says abstaining on PM May's deal "never an option"
- UK consumer sentiment falls to five-year low - EU survey
- Turkish cenbank continues to strengthen reserves decisively -governor
- China makes unprecedented proposals on tech, trade talks progress-U.S. officials
- China pledges to expand financial market opening as U.S trade delegation arrives
- EZ Mar Economic Sentiment, 105.5, 105.9 f'cast, 106.1 prev, 106.2 r'vsd
- EZ Mar Business Climate, 0.53, 0.66 f'cast, 0.69 prev
- EZ Mar Industrial Sentiment, -1.7, -0.8 f'cast, -0.4 prev
- EZ Mar Services Sentiment, 11.3, 12.0 f'cast, 12.1 prev
- EZ Mar Consumer Confid. Final, -7.2, -7.2 f'cast, -7.2 prev, -7.4 r'vsd
- EZ Feb Money-M3 Annual Growth, 4.3%, 3.9% f'cast, 3.8% prev
- Key euro zone inflation expectation gauge hits lowest since Sept. 2016
- German inflation set to remain below ECB target in March, state data suggests
Economic Data Ahead
- (0830 ET/1230 GMT) The number of Americans filing for unemployment benefits is likely to have increased by 4,000 to a seasonally adjusted 225,000 for the week ended Mar. 22, while continuing claims for the week ended Mar. 15 is expected to rise to 1.75 million.
- (0830 ET/1230 GMT) The U.S. Commerce Department is expected to report that gross domestic product increased at a 2.4 percent annual rate in the fourth quarter after surging at a 2.6 percent pace in the third quarter.
- (0830 ET/1230 GMT) The U.S. Commerce Department releases the personal consumption expenditures (PCE) price index for the fourth quarter. The index is expected to rise 1.5 percent, while core PCE is likley to increase 1.7 percent.
- (0900 ET/1300 GMT) Germany reports its preliminary consumer price index for the month of March. The index is expected to edge up 0.6 percent, after gaining 0.4 percent in the previous month. On an annualized basis, it is likely to rise 1.6 percent from 1.5 percent in February.
- (1000 ET/1400 GMT) The National Association of Realtors is likely to report that U.S. pending home sales increased 0.7 percent in February after rising 4.6 percent in January.
- (1030 ET/1430 GMT) The Energy Information Administration (EIA) reports its Natural Gas Storage for the week ending March 22.
- (1100 ET/1500 GMT) Federal Reserve Bank of Kansas City issues manufacturing activity index for the month of March. The indicator stood at -4 in the previous month.
Key Events Ahead
- (0800 ET/1200 GMT) ECB policymaker and Bank of France Governor Francois Villeroy speaks at a conference at the French central bank in Paris
- (0930 ET/1330 GMT) Federal Reserve Vice Chair Richard Clarida participates in a panel discussion at the Banque de France and European Money and Finance Forum Colloquium in Paris
- (1000 ET/1400 GMT) Federal Reserve Governor Michelle Bowman speaks in a telephone town hall in Deming, New Mexico
- (1130 ET/1530 GMT) Federal Reserve Bank of Atlanta President Raphael Bostic participates in "Workforce Development, Income Mobility and Income Inequality" panel before event, "From Bankhead to Buckhead: Prosperity for All," Atlanta.
- (1300 ET/1700 GMT) Swiss National Bank Governing Board Member Andréa Maechleris is scheduled to give a speech
- (1315 ET/1715 GMT) Federal Reserve Bank of New York President John Williams participates in moderated discussion on the economy and answers questions in San Juan, Puerto Rico
- (1430 ET/1830 GMT) Federal Reserve Bank of New York President John Williams is scheduled to participate in a small business and entrepreneur roundtable discussion.
- (1515 ET/1915 GMT) Reserve Bank of New Zealand Governor Adrian Orr speaks on the future of New Zealand's monetary policy framework in Wellington
- (1820 ET/2220 GMT) Federal Reserve Bank of St. Louis President James Bullard speaks on the U.S. economy and monetary policy in Madison, Wisconsin
FX Beat
DXY: The dollar index advanced as its counterparts struggled following more dovish soundings from central banks. The greenback against a basket of currencies traded 0.2 percent up at 97.14, having touched a peak of 97.14, its highest since Mar. 12. FxWirePro's Hourly Dollar Strength Index stood at 93.85 (Slightly Bullish) by 1100 GMT.
EUR/USD: The euro declined to a 2-1/2 week peak after data showed Eurozone economic sentiment eased more than expected in March, due to deteriorating sentiment in industry and services. The European currency traded 0.05 percent down at 1.1242, having touched a low of 1.1234, its lowest since Mar. 11. FxWirePro's Hourly Euro Strength Index stood at -115.17 (Highly Bearish) by 1100 GMT. Immediate resistance is located at 1.1285 (Mar. 28 High), a break above targets 1.1359 (Mar. 18 High). On the downside, support is seen at 1.1221 (Mar. 11 Low), a break below could drag it till 1.1176 (Mar. 7 Low).
USD/JPY: The dollar plunged, extending previous session losses, as investor risk-sentiment weakened after Reuters survey showed factory activity in China likely contracted for a fourth straight month in March, indicating the economy is still losing steam. The major was trading 0.2 percent down at 110.31, having hit a low of 109.70 on Monday, its lowest since Feb. 8. FxWirePro's Hourly Yen Strength Index stood at 59.55 (Bullish) by 1100 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. unemployment benefit claims, gross domestic product, personal consumption expenditure, pending home sales and Fed officials' speech. Immediate resistance is located at 110.89 (Mar. 22 High), a break above targets 111.23 (Feb. 25 High). On the downside, support is seen at 109.91 (Mar. 26 Low), a break below could take it lower at 109.55 (Feb. 6 Low).
GBP/USD: Sterling slumped to a 6-day low, as the British parliament's attempt to agree an alternative plan for Brexit to May's agreement with Brussels fell short on Wednesday, leaving the Brexit process as deadlocked as ever. Additionally, a survey showing consumer sentiment in Britain fell to its lowest point in more than five years in March further dented the bid tone around the British pound. The major traded 0.4 percent down at 1.3141, having hit a high of 1.3269 on Wednesday; it’s highest since Mar. 20. FxWirePro's Hourly Sterling Strength Index stood at 19.60 (Neutral) 1100 GMT. Immediate resistance is located at 1.3254 (Mar. 4 High), a break above could take it near 1.3311 (Mar. 19 High). On the downside, support is seen at 1.3068 (Mar. 7 Low), a break below targets 1.3003(Mar. 21 Low). Against the euro, the pound was trading 0.4 percent down at 85.58 pence, having hit a high of 84.83 Wednesday, it’s highest since Mar. 13.
USD/CHF: The Swiss franc declined, hovering towards a 5-day low hit in the prior session, as investor sentiment slightly improved amid signs of progress in U.S.-China trade talks. The major trades 0.1 percent up at 0.9959, having touched a low of 0.9905 on Wednesday; it’s lowest since Mar. 21. FxWirePro's Hourly Swiss Franc Strength Index stood at 49.60 (Neutral) by 1100 GMT. On the higher side, near-term resistance is around 0.9986 (Jan. 22 High) and any break above will take the pair to next level till 1.0024 (Feb. 22 High). The near-term support is around 0.9895 (Jan.17 Low), and any close below that level will drag it till 0.9852 (Jan. 4 Low).
Equities Recap
European shares surged, as signs of progress in U.S.-China trade talks offset concerns over global growth.
The pan-European STOXX 600 index rallied 0.4 percent at 378.73 points, while the FTSEurofirst 300 index rose 0.1 percent to 1,488.06 points.
Britain's FTSE 100 trades 0.6 percent up at 7,234.45 points, while mid-cap FTSE 250 gained 0.3 to 18,949.72 points.
Germany's DAX rose 0.4 percent at 11,467.45 points; France's CAC 40 trades 0.4 percent lower at 5,319.38 points.
Commodities Recap
Crude oil prices declined, extending losses into a second straight session following an unexpected rise in U.S. crude inventories. International benchmark Brent crude was trading 0.5 percent down at $67.44 per barrel by 1038 GMT, having hit a high of $68.33 on Wednesday, its highest since Mar. 21. U.S. West Texas Intermediate was trading 0.5 percent lower at $59.05 a barrel, after rising as high as $60.37 last week, its highest since the Nov. 12.
Gold prices eased to a 1-week trough as the greenback surged to multi-week peaks and extended gains for a third straight session against its peers. Spot gold prices declined 0.2 percent to $1,306.50 per ounce by 1044 GMT, having touched a high of $1,324.40 on Monday, its highest since Feb 28. U.S. gold futures were down 0.1 percent at $1,308.70 an ounce.
Treasuries Recap
The U.S. Treasury yields slipped during the afternoon session, ahead of the country’s gross domestic product (GDP) for the fourth quarter of 2018, scheduled to be released today by 12:30GMT12:30GMT, besides, speeches by FOMC members Clarida, Bowman, Williams and Bullard, all due later today. The yield on the benchmark 10-year Treasury yield edged nearly 1 basis point up at 2.379 percent, the super-long 30-year bond yields hovered around 2.823 percent and the yield on the short-term 2-year traded 1-1/2 basis points higher at 2.224 percent.
The United Kingdom’s gilts gained during the afternoon session, after Prime Minister Theresa May’s increasingly desperate attempts to get her Withdrawal Agreement passed, including a promise to Conservative MPs yesterday evening to step down from her position, if it was indeed passed, might have run out of road. The yield on the benchmark 10-year gilts, suffered nearly 2 basis points to 0.998 percent, the super-long 30-year bond yields slipped nearly 1-1/2 basis points to 1.528 percent and the yield on the short-term 2-year slumped nearly 3 basis point to 0.649 percent
The Japanese government bonds closed higher, tracking a rally in the global debt market as investors mounted among investors that an economic slowdown is nearing, especially after late last week U.S. 3-month Treasury yield topped the 10-year counterpart, leading to a partial inversion of the yield curve, a necessary condition for a recession ahead. The yield on the benchmark 10-year JGB note, which moves inversely to its price, plunged over 2-1/2 basis points to -0.093 percent, the yield on the long-term 30-year traded slumped over 3-1/2 basis points to 0.505 percent and the yield on short-term 2-year suffered 13 basis points to trade at -0.176 percent.
The Australian government bonds rallied during Asian trading session as investors moved towards safe-haven buying as markets risk sentiments dampened due to ongoing global growth worries. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, fell to a low of 1.722 percent, floating 4-1/2 basis points lower at 1.731 percent, the yield on the long-term 30-year bond also plunged 4-1/2 basis points to 2.380 percent and the yield on short-term 2-year too traded 1/2 basis point lower at 1.458 percent.
