Market Roundup
- EUR/USD -0.1%, USD/JPY -0.4%, EUR/JPY -0.6%, GBP/USD -0.2%
- DAX -0.1%, FTSE -0.25%, Brent +0.5%, Gold +0.4%, Copper +0.1%
- EUR/JPY hits 4 month low of 117.58 on heightened risk aversion
- UST 10-year yield nears key 2.30 support but stages recovery to 2.33 into NY
- EZ Feb Retail sales 0.7% m/m, 1.8% y/y vs previous 0.1%/1.5% revised 0.5$/1.4% forecast
- UK Mar Construction PMI slips to 52.2 vs previous 52.5. 52.4 forecast
- Britain's May must prove "no deal is better than a bad deal"-committee
- Bank of England says rapid credit growth could hurt UK banks
- S&P Global Ratings downgrades S.A credit rating to junk status for 1st time in 17 years
- ZAR falls 1.0% against dollar after S&P downgrade
- Macron seen beating Le Pen in second round of French election -Le Monde poll
- Le Pen says banks will not quit France if France quits euro
- Australia central bank holds rates at 1.5 pct
- Australia needs more housing to cool red-hot property prices - central bank governor
Economic Data Ahead
- (0830 ET/1230 GMT) The United States releases trade balance figures for the month of February. The economy's trade deficit is expected to have narrowed modestly to $44.9 billion from 48.5 billion in January.
- (0830 ET/1230 GMT) The Statistics Canada is likely to report that international trade surplus narrowed to C$0.55 billion in February from C$0.81 billion in January.
- (0945 ET/1345 GMT) The NAPM-New York releases ISM-New York Index for the month of March. The index stood at 51.3 in the previous month.
- (1000 ET/1400 GMT) The United States is likely to report that factory orders increased 1.0 percent in February, after posting a rise of 1.4 percent in the prior month.
- (1000 ET/1400 GMT) The Investor's Business Daily (IBD)/ TechnoMetrica Institute of Policy and Politics (TIPP) will release U.S. Economic Optimism index for the month of April. The indicator rose to 55.3 in March.
- (1630 ET/2030 GMT) API reports its weekly crude oil stock.
- (1901 ET/2301 GMT) The British Retail Consortium (BRC) will report its Shop Price Index for the month of March. The index fell at an annualized rate of 1.0 percent in the previous month.
- (1930 ET/2330 GMT) The Australian Industry Group (AiG) releases its Performance of Services Index for the month of February. The index stood at 49 in January.
Key Events Ahead
- (0930 ET/1330 GMT) European Central Bank executive board member Mario Draghi speaks at the ECB in Frankfurt.
- (1145 ET/1645 GMT) FedTrade 15-year Fannie Mae/Freddie Mac securities (max $525 mn)
- (1630 ET/2030 GMT) Federal Reserve Board Governor Daniel Tarullo speaks at Princeton, University.
FX Beat
DXY: The dollar fell to a 1-week low versus its Japanese counterpart as risk-averse investors poured into the safe-haven currency. The greenback against a basket of currencies traded flat at 100.59, having hit a high of 100.69 in the previous session, its highest since Mar. 16. FxWirePro's Hourly Dollar Strength Index stood at 62.93 (Bullish) by 1000 GMT.
EUR/USD: The euro declined amid renewed strength seen in the greenback, despite upbeat Eurozone February retail sales data. The economy's retail sales came in at 0.7 percent, against expectations of 0.5 percent and previous revised reading of 0.1 percent. The European currency traded 0.1 percent down at 1.0659, having touched a low of 1.0642 on Monday, its lowest since Mar. 15. FxWirePro's Hourly Euro Strength Index stood at -101.88 (Highly Bearish) by 1000 GMT. On the lower side, any break below 1.06400 will drag the pair till 1.0600/1.05250 (Mar 9th low)/1.04940 (Mar 2nd low). The near term resistance is around 1.0709 (21- day EMA) and any break above will take it to next level till 1.07450/ 1.07800.
USD/JPY: The dollar tumbled to a 1-week low as investor appetite for risk faded ahead of an upcoming meeting between U.S. President Donald Trump and Chinese President Xi Jinping and a suspected suicide bombing in St. Petersburg, Russia. The major traded 0.4 percent down at 110.43, having touched a low of 110.32 earlier, its lowest since Mar. 28. FxWirePro's Hourly Yen Strength Index stood at 105.02 (Highly 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 declined to a 5-day low after data showed growth in Britain's construction industry slowed slightly in March, adding to concerns that the economy has lost some of its strong momentum since the Brexit vote. The economy's Construction Purchasing Managers' Index eased to 52.2 from 52.5 in February. Sterling trades 0.25 percent lower at 1.2455, hovering towards a low of 1.2376 hit last week, its lowest since Mar. 21. FxWirePro's Hourly Sterling Strength Index stood at 112.35 (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 1.2480 will take it till 1.2525/1.2580. Against the euro, the pound traded 0.1 percent lower at 85.55 pence, having hit a high of 84.81 on Friday, its highest since Feb 27.
USD/CHF: The Swiss franc declined as the greenback gained despite risk off-market sentiment. The major traded 0.1 percent up at 1.0025, 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 -143.73 (Highly Bearish) by 1000 GMT. 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 it till 0.9960/0.9912 (200- day MA) /0.98600/0.98100.
AUD/USD: The Australian dollar eased to a 3-week low after the central bank kept rates on hold at its monthly policy meeting and raised concerns about domestic labor conditions. The Aussie trades 0.7 percent down at 0.7550, having hit a low of 0.7545 earlier, it’s lowest since Mar. 14. FxWirePro's Hourly Aussie Strength Index stood at -143.75 (Highly Bearish) by 1000 GMT. On the lower side, the next immediate support stands at 0.74910 (Mar 9th low) and any break below will drag the pair down till 0.7450. The major resistance is around 0.7633 (21- day EMA) and a break above will take it till 07680/0.7745.
Equities Recap
European shares eased in early trade, weakened by losses in auto stocks, while investors remained cautious ahead of a meeting between the U.S. and Chinese presidents.
The pan-European STOXX 600 index declined 0.08 percent to 378.99 points, while the FTSEurofirst 300 index fell 0.06 percent to 1,493.63 points.
Britain's FTSE 100 trades 0.26 percent up at 7,302.04 points, while mid-cap FTSE 250 rose 0.22 percent to 18,995.94 points.
Germany's DAX edged down 0.17 percent at 12,236.43 points; France's CAC 40 trades 0.13 percent lower at 5,079.02 points.
Tokyo's Nikkei fell 0.91 percent to 18,810.25 points, Australia's S&P/ASX 200 index fell 0.27 percent to 5,859.60 points. South Korea's KOSPI declined 0.30 percent to 2,161.10 points.
Commodities Recap
Crude oil prices declined, extending previous session losses, following a rise in Libyan production and an increase in U.S. drilling rig capacity. International benchmark Brent crude was trading 0.2 percent down at $52.96 per barrel by 0907 GMT, having hit a high of $53.74 on Friday, its strongest since Mar. 9. U.S. West Texas Intermediate crude fell 0.2 percent to $50.10 a barrel, after rising as high as $50.80 last week, its highest since Mar. 9.
Gold prices rallied to a one-week high, as investors turned to safe-haven assets on worries over geopolitical tensions. Spot gold gained 0.4 percent to $1,258.16 per ounce at 0909 GMT, having hit a high of $1,259.97 earlier, its highest since March 27. U.S. gold futures were up 0.5 percent at $1,259.9.
Treasuries Recap
The U.S. Treasuries remained upbeat as investors wait to watch the Federal Open Market Committee (FOMC) meeting minutes, scheduled to be released on April 5, besides, the employment report later this week. The yield on the benchmark 10-year Treasury slumped nearly 2-1/2 basis points to 2.32 percent, the super-long 30-year bond yields plunged 2 basis points to 2.96 percent and the yield on short-term 3-year note slipped nearly 1 basis point to 1.45 percent.
The UK gilts traded flat, showing modest gains, following the country’s lower-than-expected construction PMI released today. The yield on the benchmark 10-year gilts hovered around 1.05 percent, the super-long 30-year bond yields fell nearly 1 basis point to 1.64 percent while the yield on the short-term 2-year traded flat at 0.10 percent.
The German bunds gained as investors largely shrugged off Eurozone’s higher-than-expected retail sales for the month of February. The yield on the benchmark 10-year bond, slumped 2 basis points to 0.26 percent, the long-term 30-year bond yields also plunged nearly 2 basis points to 1.05 percent and the yield on the short-term 2-year bond traded 3-1/2 basis points lower at -0.82 percent.
The Japanese government bonds remained upbeat, tracking firmness in the United States counterpart and impressive sale at the 10-year auction held earlier today. The benchmark 10-year bond yield, fell 1 basis point to 0.06 percent, the long-term 15-year bond yields also slipped 1 basis point to 0.33 percent and the yield on the short-term 2-year note traded 1-1/2 basis points lower at -0.17 percent.
The New Zealand bonds traded higher as investors are curiously eyeing the GlobalDairyTrade (GDT) price auction, scheduled to be held on April 5 for detailed direction in the debt market. The yield on the benchmark 10-year bond, slumped 7 basis points to 3.11 percent, the yield on 7-year note plunged 4 basis points to 2.74 percent and the yield on short-term 2-year note also traded 3-1/2 basis points lower at 2.11 percent.
The Australian bonds jumped sharply following the Reserve Bank of Australia’s (RBA) monetary policy decision. The yield on the benchmark 10-year Treasury note, plunged 6-1/2 basis points to 2.62 percent, the yield on 15-year note also plunged nearly 6-1/2 basis points to 2.99 percent and the yield on short-term 2-year traded 3-1/2 basis points lower at 1.72 percent.
