Market Roundup
- U.S. private sector adds 214,000 jobs in February vs 195k forecast -ADP.
- Fed's Williams: U.S. yield curve may stay flat even as rates rise; "gradual" is key message on rate hikes.
- U.S. natural gas futures fall to 17-year low on warm forecasts.
- Weekly US crude stocks up 10.37mn BBLS vs forecast 3.6mn BBLS build.
- Russia's Rosneft, facing natural output decline, floats idea of oil production cuts.
- Saudi Arabia asks banks to discuss major loan -sources.
- Gold rebounds on weaker equities, shrugs off U.S. data.
- Global watchdog says bond market liquidity a concern.
- Huge quake strikes off Indonesia but tsunami warnings cancelled.
Looking Ahead - Economic Data (GMT)
- 22:30 Australia AIG Services Index* Feb 4840.00%-previous
- 23:50 Japan Foreign Bond Inventories* w/e 1974.3b-previous
- 23:50 Japan Foreign Invest JP Stock* w/e -441.0b- previous
- 00:30 Australia Trade Balance G&S (A$)*Jan forecast -3100m,-3535m- previous
- 00:30 Australia Goods/Services Imp* Jan -1.00%- previous
- 00:30 Australia Goods/Services Exp* Jan -5.00%- previous
- 01:45 China Caixin Services PMI*Feb 52.4- previous
Looking Ahead - Events, Other Releases (GMT)
- No Significant Events
Currency Summaries
EUR/USD is likely to find support at 1.0820 levels and currently trading at 1.0866 levels. The pair has made session high at 1.0871 and hit lows at 1.0825 levels. The euro extended losses against US dollar on Wednesday, as the dollar was supported by upbeat ADP Employment data. The dollar rose against the euro, after getting a lift from data which showed U.S. private employers added 214,000 jobs in February, above economists' expectations, suggesting solid job growth despite market turmoil and worries about a slowing global economy, bolstering expectations that the Federal Reserve will raise interest rates later this month. The euro fell to $1.0830, its lowest level against the greenback since Feb. 1, after the ADP National Employment Report in the early New York session.
GBP/USD is supported in the range of 1.3985 and currently trading at 1.4079 levels. It reached session high at 1.4094 and hit low at 1.3920 levels. Sterling rose to a nine-day high on Wednesday, trading above $1.40, as some investors trimmed large bets against the currency in the absence of fresh clues from polls on whether Britain is likely to leave the European Union. The pound also rose more than 1 percent against the euro, which came under pressure on expectations that the European Central Bank is likely to ease policy aggressively next week to boost falling prices and growth. Sterling was up 0.75 percent at $1.4056, and up nearly 1.7 percent from a 7-year low of $1.3836 struck on Feb. 29. It was up 1 percent at 77.15 pence per euro, recovering from a 14-month low of 79.28 pence hit on Feb. the data front, the construction purchasing managers index showed growth in the sector fell to a 10-month low in February in what was its weakest reading in almost three years.
USD/JPY is supported around 112.80 levels and currently trading at 113.45 levels. It peaked to hit session high at 114.26 and made session lows at 113.19 levels. Dollar lost its momentum against yen on Wednesday as volatility in oil prices stoked concerns over the U.S. economy and boosted the safe-haven yen shrugging off strong U.S. private payrolls data dollar erased gains against the yen after hitting 114.55 yen, its highest level against the Japanese currency in more than two weeks. Investors awaited the key nonfarm payrolls data on Friday for clues as the whether the Fed would again take step to raise interest rates when the Fed's meet later in the month. The U.S. dollar index, which hit a roughly one-month high of 98.582 earlier, was last down 0.17 percent at 98.176. The dollar was last down 0.53 percent against the yen at 113.38 yen.
USD/CAD is supported at 1.3400 levels and is trading at 1.3421 levels. It has made session high at 1.3503 and lows at 1.3418 levels. The Canadian dollar gained ground against its U.S. counterpart on Wednesday after crude oil price rebounded erasing a brief dip after data showed huge build in US crude stockpiles. The currency reached a 12-week high on Tuesday at C$1.3387, after stronger-than-expected growth in fourth quarter gross domestic product reduced pressure on the Bank of Canada to cut rates.Early in the U.S. session, data showing stronger-than-expected growth in U.S. private payrolls in February added to a recent pile of reassuring U.S. economic data and boosted expectations that the Federal Reserve would hike interest rates at least once this year. The currency's strongest level of the session was C$1.3406, while its weakest level was C$1.3493.
Equities Recap
European shares rose on Wednesday, with banks making their fifth straight day of gains after previously suffering heavy losses, while eyewear maker Luxottica led the losers after it trimmed its profit guidance.
UK's benchmark FTSE 100 closed down by 0.9 percent, the pan-European FTSEurofirst 300 ended the day up by 0.58 percent, Germany's Dax closed up by 0.64 percent, and France's CAC finished the day up by 0.37 percent.
Stocks were slightly higher on Wall Street on Wednesday as gains in energy and banks buoyed the S&P500.
Dow Jones closed up 0.19 percent, S&P 500 ended the day up by 0.41 percent, Nasdaq finished the day up by 0.28 percent.
Treasuries Recap
U.S. Treasury yields rose on Wednesday on fewer growth jitters as a combination of domestic and foreign data supported the recently revived view that the Federal Reserve will raise interest rates this year, causing traders to sell some safe-haven government debt.
Benchmark 10-year notes were last down 5/32 in price to yield, up from 1.835 percent late on Tuesday. The 10-year yield earlier hit 1.872 percent, its highest in over three weeks.
The 30-year bond was last up 5/32 in price to yield 2.697 percent, down from 2.705 percent late on Tuesday. The 30-year yield touched 2.709 percent, a two-week high.
Commodities Recap
Oil prices ended up for a third straight day on Wednesday as buyers shrugged off record high U.S. crude stockpiles to focus on an OPEC plan to freeze production, keeping alive the notion that market has bottomed from a near two-year selloff.
Brent futures settled up 12 cents at $36.93 a barrel. They have risen more than $1.80, or 5 percent, since Friday's close.
U.S. crude's West Texas Intermediate (WTI) futures finished up 26 cents at $34.66 a barrel. Only in mid-February, WTI fell to a 2003 low of $26.05.
Gold rebounded on Wednesday as the U.S. dollar turned lower, shrugging off a turn higher in global shares and better-than-expected U.S. economic data.
Spot gold lower initially, rose 0.8 percent to $1,241.70 an ounce by 3:14 p.m. EST (2014 GMT), while U.S. gold futures for April delivery settled up 0.9 percent at $1,241.80 an ounce.
