Friday 1st April: European Open Briefing

Global Markets:

• Asian stock markets: Nikkei down 2.90 %, Shanghai Composite lost 1.40 %, Hang Seng declined 1.30 %, ASX 200 fell 1.80 %
• Commodities: Gold at $1231.70 (-0.30 %), Silver at $15.42 (-0.30 %), WTI Oil at $38.05 (-0.70 %), Brent Oil at $40.00 (-0.80 %)
• Rates: US 10 year yield at 1.80, UK 10 year yield at 1.43, German 10 year yield at 0.15

News & Data:

• China Official Manufacturing PMI (Mar): 50.2 (exp 49.4 prev 49.0)
• China Official Non-Manufacturing PMI (Mar): 53.8 (prev 52.7)
• China Caixin Manufacturing PMI (Mar): 49.7 (exp 48.3 prev 48.0)
• Japan Nikkei Manufacturing PMI (Mar, F): 49.1 (flash 49.1)
• Japan Tankan Large Manufacturing Index: 6 (exp 8 prev 12)
• Japan Tankan Large Manufacturing Outlook: 3 (exp 7 prev 7)
• Japan Large Non-Manufacturing Index: 22 (exp 24 prev 25)
• Japan Large Non-Manufacturing Outlook: 17 (exp 20 prev 18)
• Japan Large All Industry Capex (YoY): -0.9% (exp -0.7% prev 10.8%)
• South Korea CPI (MoM) Mar: -0.3% (exp 0.0% prev 0.5%)
• South Korea CPI (YoY) Mar: 1.0% (exp 1.3% prev 1.3%)
• South Korea Trade Balance (Mar): USD 7385 Mln (exp USD 8496 Mln prev rev USD 7385 Mln)
• South Korea Exports (YoY) Mar: -8.2% (exp -10.9% prev -12.2%)
• South Korea Imports (YoY) Mar: -13.8% (exp -14.3% prev -14.6%)
• Australia AiG PMI (Mar): 58.1 (prev 53.5)
• PBoC Fixes Yuan At 6.4585 (prev 6.4612)
• Fed's Dudley: US Economy Is In A `Relatively Good Place' — BBG
• Dudley: Fears Of Runaway Inflation Have Proved Unwarranted
• Dudley: Will Continue Gradual Rate Hikes If US Stays On Track, Risk Management Another Reason For Caution
• Dudley: Fed Doesn't Want Higher Inflation Without Higher Wages

Markets Update:

The US Dollar rose overnight, supported by hawkish comments from FOMC member William Dudley. EUR/USD traded in a 1.1366-88 range, while GBP/USD fell from 1.4370 to 1.4330. The Euro remains the best performing currency and the break above 1.1380 resistance suggests that a test of 1.15 could happen soon. Meanwhile, the British Pound continues to be under pressure amid worries about the Brexit vote. 
 

USD/JPY fell sharply overnight, as the Asian equity markets opened lower. The pair declined from 112.60 in the early session to a low of 112.05, where it found support and bounced to 112.30. 

 

The commodity currencies all fell against the USD in the Asian session. AUD/USD tumbled from 0.77 to 0.7650, while NZD/USD declined from 0.6940 to 0.6895. USD/CAD caught a bid after bouncing off the 1.2856 support level yesterday and rallied back above 1.30 overnight. Resistance is now seen at 1.3080, followed by 1.3130.

Upcoming Events:

• 08:15 BST – Swiss Retail Sales

• 08:45 BST – Italian Manufacturing PMI

• 08:50 BST – French Manufacturing PMI

• 08:55 BST – German Manufacturing PMI

• 09:00 BST – Euro Zone Manufacturing PMI

• 09:30 BST – UK Manufacturing PMI

• 10:00 BST – Euro Zone Unemployment Rate

• 13:30 BST – US Nonfarm Payrolls

• 13:30 BST – US Unemployment Rate

• 13:30 BST – US Average Hourly Earnings

• 14:45 BST – US Manufacturing PMI

• 15:00 BST – US ISM Manufacturing PMI

• 15:00 BST – US Michigan Consumer Confidence