Market Roundup
- US durable goods orders rebound strongly in January (4.9% vs 2.5% forecast).
- US jobless claims up, but trend points to firming labor market (272k vs 270k forecast).
- Oil erases losses on talk of major producers meeting in March, stocks move higher.
- Fed's Williams: not taking strong signal from low US inflation expectations, eyes gradual tightening.
- German FinMin Schaeuble: Euro FX rate somewhat too cheap for German econ, urges G20 to avoid CCY devaluation.
- ECB's favored inflation gauge hits record low sub-1.40% ( 5Y5Y BE hits low at 1.38% on weak oil/China).
- Fed's Bullard: Recession probability not high, Fed hike may have spurred market turmoil .
- Greece won't cut pensions again to meet EU/IMF demands -labour minister.
- Europe shrugs off pre-G20 China mauling, sterling steadies.
- US postpones 7-year note auction due to technical issue, Auction to be held Friday.
Looking Ahead - Economic Data (GMT)
- 21:45 New Zealand Trade - Imports* Jan forecast 3.87b, 4.48b-previous
- 21:45 New Zealand Trade Balance* Jan forecast -245.5m, -53.0m- previous
- 21:45 New Zealand Trade Balance YY* Jan forecast -3.84b, -3.55b- previous
- 21:45 New Zealand Trade - Exports* Jan forecast 3.74b, 4.43b- previous
- 23:30 Japan CPI, Core Nationwide YY*Jan forecast 0%, 0.1%- previous
- 23:30 Japan CPI, Overall Nationwide* Jan 0.2%- previous
- 23:30 Japan CPI Core Tokyo YY*Feb forecast -0.2%, -0.1%- previous
- 23:30 Japan CPI, Overall Tokyo* Feb -0.3%- previous
Looking Ahead - Events, Other Releases (GMT)
- No Significant Events
Currency Summaries
EUR/USD is likely to find support at 1.1000 levels and currently trading at 1.1018 levels. The pair has made session high at 1.1050 and hit lows at 1.0984 levels. Euro edged higher against dollar as rebound European stocks helped the euro on Thursday as traders looked to as investors look to the G20 meeting of finance ministers and central bankers starting on Friday, pressure is on leaders to get the global economy back on track and calm markets after one of the rockiest starts to a year on record. As doubt continued to grow about whether the Fed can raise rates in March, or indeed at all this year, the dollar struggled to make significant headway. The euro was up 0.1 percent at $1. the data front , U.S. manufactured goods in January rose by the most in 10 months as demand picked up broadly, offering a ray of hope for the downtrodden manufacturing sector. The Commerce Department said orders for durable goods, surged 4.9 percent last month, reversing December's 4.6 percent plunge.
GBP/USD is supported in the range of 1.3910 and currently trading at 1.3961 levels. It reached session high at 1.3984 and hit low at 1.3900 levels. Sterling traded in choppy range on Thursday as the currency struggled to pull away from a seven-year low against the dollar on Thursday and was on track for its heaviest weekly fall since 2009 on worries about a possible British exit from the European Union. Sterling has been hit by worries over the June 23 referendum because a possible Brexit threatens the huge foreign investment flows that Britain needs just to balance its national current account deficit - one of the biggest in the developed world at some 5 percent of the UK's economic output. Despite the pound being up 0.4 percent at $1.3975, it remained around 3 percent lower this week against the dollar, with a test of its 2009 low of $1.35 within sight.
AUD/USD is supported around 0.7200 levels and currently trading at 0.7236 levels. It hit session high at 0.7245 and made session lows at 0.7190 levels. The Australian inched higher against dollar during Thursday's US session recovering from earlier loses after crude oil prices rebounded after confirmation of a meeting of major oil producers. Earlier in the Asian session the pair dipped after Australian business investment planned for 2016/17 was estimated at A$83 billion, versus expectations of around A$93 billion. The Australian dollar in the Asian session dipped towards $0.7190, away from a seven-week peak of $0.7259 touched this week. However sharp gains in crude oil prices in the US session pushed the pair up at $0.7230.
USD/CAD is supported at 1.3500 levels and is trading at 1.3534 levels. It has made session high at 1.3578 and lows at 1.3517 levels. The Canadian dollar strengthened against its U.S. counterpart on Thursday, hitting a 2-1/2-month high as investors believed that the Bank of Canada will cut interest rates this year. The currency extended its recovery from a 12-year low of C$1.4689 in January, helped by stabilization in crude oil prices and the shifting of the fiscal stimulus burden from the Bank of Canada to the Canadian government. The currency strongest level of the session was C$1.3521, while its weakest was C$1.3735. Canadian government bond prices were mixed across the maturity curve, with the two-year price down 0.5 Canadian cent to yield 0.497 percent and the benchmark 10-year rising 12 Canadian cents to yield 1.137 percent
Equities Recap
European shares rebounded on Thursday from losses earlier in the week, as solid corporate results including from British bank Lloyds lifted stock markets.
Britain's blue-chip FTSE 100 index closed up by 2.5 percent, France's benchmark CAC-40 index closed up by 2.1 percent, Germany's DAX ended up 1.49 percent, meanwhile the pan-European Eurofirst 300 index was up by 1.95 percent.
U.S. stocks were slightly higher on the day after data showed an uptick in U.S. manufacturing and a 6 percent fall in Shanghai's stock market did not spill over to Europe, where shares rebounded.
Dow Jones closed up by 1.29 percent, S&P 500 ended up by 1.13 percent, Nasdaq finished the day up by 0.86 percent.
Treasuries Recap
U.S. Treasury yields fell on Thursday as investors remained cautious on the outlook for global growth, with yields also undergoing a sharp, if brief, drop after the government postponed its seven-year note auction.
U.S. benchmark 10-year Treasury notes were last up 12/32 in price to yield 1.70 percent, down from 1.74 percent late Wednesday.
Commodities Recap
Spot gold rose on Thursday, buoyed by a strong technical formation and the potential for a bullish golden cross to form, while the futures market pared losses after feeling earlier pressure from the strong equity markets.
Spot gold was up 0.6 percent at $1,235.70 an ounce at 3:13 p.m. EST (2013 GMT), heading for a third straight day of gains but remaining below the one-year high of $1,260.60 reached on Feb. 11.
U.S. gold futures most-active April contract settled down 30 cents at $1,238.80 per ounce.
Crude oil futures jumped 3 percent on Thursday, reversing earlier loses after confirmation of a meeting of major producers and news of project delays and job cuts in the industry.
U.S. crude futures settled up 92 cents, or 2.9 percent, at $33.07 a barrel. It had slid more than $1 at the session low.
Brent crude futures finished up 88 cents, or 2.6 percent, at $35.29 a barrel, hitting a three-week high. It had also dropped more than $1 earlier.
