Global Markets:
- Asian Stock Markets : Nikkei down 2.46%, Shanghai Composite down 3.40%, Hang Seng down 5.51%, ASX down 9.70%
- Commodities : Gold at $1532.15 (+1.02%), Silver at $14.30 (-1.38%), Brent Oil at $31.76 (-6.17%), WTI Oil at $30.62 (-4.64%)
- Rates : US 10-year yield at 0.709, UK 10-year yield at 0.416, Germany 10-year yield at -0.583
News & Data:
- (JPY) BOJ Policy Rate -0.10% vs -0.10% expected
- (CNY) Fixed Asset Investment ytd/y -24.50% vs -2.00% expected
- (CNY) Industrial Production y/y -13.50% vs -3.00% expected
- (USD) Federal Funds Rate <0.25% vs <1.25% previous
- (NZD) Official Cash Rate 0.25% vs 1.00% previous
- (CAD) Overnight Rate 0.75% vs 1.25% previous
CFTC Positioning Data:
- EUR short 13K vs 87K short last week. Shorts decreased by 74K
- GBP long 26K vs 35K long last week. Longs decreased by 9K
- JPY long 8K vs 42K short last week. Shorts decreased by 50k and turn long
- CHF square vs 3K short last week. Shorts decreased by 3K
- AUD short 54k vs 52K short last week. Shorts increased by 2K
- NZD short 15K vs 17K short last week. Shorts decreased by 2K
- CAD short 2k vs 11K long last week. Longs decreased by 13K.
Markets Update:
Asian stock markets are sharply lower on Monday and US stock futures tumbled after the U.S. Federal Reserve, in an emergency move on Sunday, slashed its benchmark lending rate to near zero and launched a new round of quantitative easing worth $700 billion to help the U.S. economy deal with the effects of the coronavirus.
In addition, the Reserve Bank of New Zealand pared its official cash rate by 75 basis points to 0.25 percent in response to the economic implications of the coronavirus outbreak.
However, the emergency rate cuts raised concerns that the central banks’ support may not be enough to cushion the economic fallout from the COVID-19 outbreak. Weak economic data from China, including industrial production data, further dampened sentiment.
In Japan, the Nikkei 225 closed 2.46% lower at 17,002.04. The Topix index was also 2.01% lower to end its trading day at 1,236.34. The Australian market is tumbling more than 5 percent after the emergency rate cuts by the U.S. Federal Reserve and the Reserve Bank of New Zealand.
In addition, the Reserve Bank of Australia used its daily market operation to add A$5.9 billion to the banking system to ensure businesses and households have access to credit amid the coronavirus outbreak. Mainland Chinese stocks dropped on the day as well, with the Shanghai composite 3.4% lower while the Shenzhen composite slipped 4.9%.
The Japanese yen, often viewed as a safe-haven currency in times of economic uncertainty, traded at 106.31 per dollar from lows around 108 seen late last week.
Oil prices dropped in the afternoon of Asian trading hours on Monday, with international benchmark Brent crude futures down 6.2%. The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 98.216 after rising from levels below 96 last week.
Upcoming Events:
Monday, March 16, 2020
- 12:30 PM GMT – (USD) Empire State Manufacturing Index
Tuesday, March 17, 2020
- 12:30 AM GMT – (AUD) Monetary Policy Meeting Minutes
- 12:30 AM GMT – (AUD) HPI q/q
- 09:30 AM GMT – (GBP) Average Earnings Index 3m/y
- 10:00 AM GMT – (EUR) German ZEW Economic Sentiment
- 12:30 PM GMT – (CAD) Manufacturing Sales m/m
- 12:30 PM GMT – (USD) Core Retail Sales m/m
- 12:30 PM GMT – (USD) Retail Sales m/m
Wednesday, March 18, 2020
- 12:30 PM GMT – (CAD) CPI m/m
- 12:30 PM GMT – (CAD) Common CPI y/y
- 12:30 PM GMT – (CAD) Median CPI y/y
- 12:30 PM GMT – (CAD) Trimmed CPI y/y
- 12:30 PM GMT – (USD) Building Permits
- 09:45 PM GMT – (NZD) GDP q/q
Thursday, March 19, 2020
- 12:30 AM GMT – (AUD) Employment Change
- 12:30 AM GMT – (AUD) Unemployment Rate
- 08:30 AM GMT – (CHF) SNB Monetary Policy Assessment
- 08:30 AM GMT – (CHF) SNB Policy Rate
- 12:30 PM GMT – (USD) Philly Fed Manufacturing Index
Friday, March 20, 2020
- 12:30 PM GMT – (CAD) Core Retail Sales m/m
- 12:30 PM GMT – (CAD) Retail Sales m/m
- &more…