Market Roundup
- EUR/USD -0.05%, USD/JPY +0.1%, EUR/JPY +0.1%, GBP/USD +0.3%
- DAX -0.3%, FTSE +0.2%, Brent +1.0%, Gold -0.2%, Copper +1.1%
- Germany Mar Markit Services PMI 55.6 vs previous 55.6. 55.6 forecast
- Germany Mar Markit Composite final PMI 57.1 vs previous 57.0. 57/0 forecast
- EZ Mar Markit Service final PMI 56.0 vs previous 56.5. 56.5 forecast
- EZ Mar Markit Composite final PMI 56.4 vs previous 56.7. 56.7 forecast
- UK Mar Markit/CIPS Service PMI 55.0 vs previous 53.3. 53.5 forecast
- UK economic productivity +0.4% in Q4 2016
- UK productivity grows at fastest rate since mid-2015 - ONS
- North Korea test-fires missile into sea ahead of Trump-Xi summit
- BOJ likely to cut inflation forecast this month-ex-BOJ official
- Turkey sees 2017 growth exceeding previous year's - finmin
- S.A ANC won't be part of movement to remove Pres Zuma-secgen Mantashe
- Rand extends losses vs dollar after ANC comments, S.A govt bond yields edge up
- Greek PM urges deal on bailout review on Friday
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 187,000 jobs were added as compared with 298,000 in February.
- (0900 ET/1300 GMT) Mexico releases its consumer confidence and gross fixed investment data for the month of March.
- (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 53.2 in the previous month.
- (0945 ET/1345 GMT) Financial firm Markit Economics is likely to report that U.S. service PMI business activity index rose to 53.1 in March after printing a final reading of 52.9 in February.
- (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 57.0 in March from 57.6 in February.
- (1030 ET/1430 GMT) The Energy Information Administration (EIA) reports its Crude Oil Stocks for the week ending March 31.
Key Events Ahead
- (1045 ET/1445 GMT) FedTrade 30-yr Fannie Mae/Freddie Mac securities (max $1.275 bn)
- (1400 ET/1800 GMT) The Federal Open Market Committee issues minutes of its March 14-15 policy meeting,
- (2300 ET/0100 GMT) Federal Reserve Bank of Dallas President Robert Kaplan participates in moderated Q&A at University of Kansas; Lawrence.
FX Beat
DXY: The dollar retreated from 1-week low versus the Japanese yen as investors awaited the release of minutes from the last U.S. Federal Reserve meeting in which the central bank decided to hike interest rates. The greenback against a basket of currencies traded flat at 100.52, having hit a peak of 100.73 on Tuesday, its highest since Mar. 16. FxWirePro's Hourly Dollar Strength Index stood at 90.69 (Slightly Bullish) by 1000 GMT.
EUR/USD: The euro edged down after Eurozone's PMI covering services industry came in at 56.0 in March below a flash estimate of 56.5. The European currency traded down at 1.0666, hovering towards a low of 1.0642 touched on Monday, its lowest since Mar. 15. FxWirePro's Hourly Euro Strength Index stood at -33.68 (Neutral) by 1000 GMT. On the lower side, any break below 1.0635 will drag the pair till 1.0600/1.05250 (Mar 9 low)/1.04940 (Mar 2 low). The near term resistance is around 1.0706 (21- day EMA) and any break above will take it to next level till 1.07450/1.07800. The short term bearish invalidation is only above 1.09058.
USD/JPY: The dollar rebounded after declining for three consecutive sessions, as focus turned towards the release of the minutes from the Federal Reserve's March meeting later in the day, with investors looking for any clues on the pace of further U.S. interest rate hike. The major traded 0.1 percent up at 110.84, having touched a low of 110.26 in the previous session, its lowest since Mar. 28. FxWirePro's Hourly Yen Strength Index stood at 75.02 (Slightly Bullish) by 1000 GMT. On the higher side, any break above 112.20 (100- day EMA) will take the pair till 112.90 (55- day EMA)/113.44. The near term support is around 110 and any break below will drag it till 108.65.
GBP/USD: Sterling gained, reversing most of its previous session losses after data released earlier showed Britain's dominant services sector activity at a three-month high in March. The Markit/CIPS Services Purchasing Managers' Index rose to 55.0, up from 53.3 in February and estimates of 53.5. Sterling trades 0.3 percent higher at 1.2481, pulling away from a low of 1.2419 touched on Tuesday, its lowest since Mar. 30. FxWirePro's Hourly Sterling Strength Index stood at 110.94 (Highly Bullish) by 1000 GMT. The near term support is around 1.2375 and any break below 1.2375 will drag the pair down till 1.2320/1.2260. On the higher side, any break above 1.2500 will take it till 1.2525/1.2580. It should break above 1.2700 for further bullishness. Against the euro, the pound traded 0.3 percent up at 85.50 pence, having hit an early low of 85.89, its lowest since Mar 31.
USD/CHF: The Swiss franc eased, extending previous session losses, as the dollar rebounded versus its major peers. The major traded 0.1 percent up at 1.0031, having hit a high of 1.0037 in the previous session, its strongest since Mar. 15. FxWirePro's Hourly Swiss Franc Strength Index stood at -21.97 (Neutral) by 1000 GMT. The major should break above 1.0170 for further bullish confirmation. The near-term resistance is at 1.00783 (61.8% retracement of 1.03435 and 0.98136)/1.00950 (trend line joining 1.033 and 1.01700). On the lower side, near term support is around 0.9995 (21- day EMA) and any violation below will take the pair till 0.9960/0.9929 (200- day MA) /0.98600/0.98100.
AUD/USD: The Australian dollar steadied, halting its 4-day losing streak after data released overnight showed activity in the economy's service industry rose to 51.7 in February from a prior reading of 49.0. The Aussie trades 0.2 percent up at 0.7574, having hit a low of 0.7545 in the previous session, it’s lowest since Mar. 14. FxWirePro's Hourly Aussie Strength Index stood at -111.40 (Highly Bearish) by 1000 GMT. On the lower side, the next immediate support stands at 0.74910 (Mar 9 low) and any break below will drag the pair down till 0.7450. The major resistance is around 0.7627 (21- day EMA) and a break above will take it till 07680/0.7745.
Equities Recap
European shares edged up in early trade, strengthened by rising energy stocks, while investors await the minutes from the Federal Reserve's March meeting for clues on the pace of further U.S. interest rate hikes.
The pan-European STOXX 600 index rallied 0.2 percent to 380.79 points, while the FTSEurofirst 300 index gained 0.23 percent to 1,501.15 points.
Britain's FTSE 100 trades 0.30 percent up at 7,343.57 points, while mid-cap FTSE 250 rose 0.01 percent to 19,020.64 points.
Germany's DAX edged down 0.22 percent at 12,255.82 points; France's CAC 40 trades 0.13 percent higher at 5,113.02 points.
Tokyo's Nikkei gained 0.27 percent to 18,861.27 points, Australia's S&P/ASX 200 index rose 0.26 percent to 5,871.80 points. South Korea's KOSPI declined 0.30 percent to 2,161.10 points.
Shanghai composite index rallied 1.5 percent to 3,270.31 points, while CSI300 index climbed 1.4 percent to 3,503.89 points. Hong Kong’s Hang Seng added 0.6 percent to 24,400.80 points.
Commodities Recap
Crude oil touched a one-month high as a decline in U.S. crude inventories renewed hopes that OPEC-led supply restraint is clearing a glut. International benchmark Brent crude was trading 1.1 percent up at $54.83 per barrel by 0918 GMT, having hit a high of $54.87 earlier, its strongest since Mar. 8. U.S. West Texas Intermediate crude rose 1.0 percent to $51.62 a barrel, after rising as high as $51.67, its highest since Mar. 8.
Gold prices eased from a one-week high hit in the session before, while appetite for riskier assets faded ahead of a meeting between the United States and the Chinese presidents. Spot gold declined 0.3 percent to $1,252.45 per ounce by 0927 GMT, having touched a high of $1,261.07 on Tuesday, its highest since March 27. U.S. gold futures gained 0.1 percent to $1,259.10.
Treasuries Recap
The U.S. Treasuries remained upbeat as investors wait to watch the March ADP non-farm employment change report later in the day, besides, the employment report due to be released on April 6 and 7 respectively. The yield on the benchmark 10-year Treasury jumped 1-1/2 basis points to 2.36 percent, the super-long 30-year bond yields rose nearly 1 basis point to 2.99 percent and the yield on short-term 2-year note climbed nearly 1-1/2 basis points to 1.26 percent.
The UK gilts plunged as investors moved away from safe-haven assets after reading the country’s upbeat services PMI for the month of March. The yield on the benchmark 10-year gilts, climbed 1-1/2 basis points to 1.08 percent, the super-long 30-year bond yields jumped 2 basis points to 1.68 percent while the yield on the short-term 3-year traded 1/2 basis point higher at 0.22 percent.
The German bunds gained modestly as investors poured into safe-haven assets after reading lower-than-expected Eurozone’s composite PMI for the month of March. The yield on the benchmark 10-year bond, fell 1/2 basis point to 0.24 percent, the long-term 30-year bond yields also slipped 1/2 basis point to 1.03 percent and the yield on the short-term 2-year bond traded 1 basis point lower at -0.79 percent.
The New Zealand bonds declined, following a positive reading at last night’s GlobalDairyTrade (GDT) price auction. The yield on the benchmark 10-year bond, which moves inversely to its price, traded flat at 3.11 percent, the yield on 7-year note rose 1 basis point to 2.75 percent and the yield on short-term 2-year note also traded 1/2 basis point higher at 2.12 percent.
The Australian bonds rallied tracking developments in the U.S. Treasuries. The yield on the benchmark 10-year Treasury note, fell 1/2 basis point to 2.61 percent, the yield on 12-year note also slipped 1/2 basis point to 2.76 percent and the yield on short-term 2-year traded 1-1/2 basis points lower at 1.70 percent.
