Global Markets:
- Asian stock markets: Nikkei down 0.81%, Shanghai Composite up 0.31 %, Hang Seng lost 0.06 %, ASX down 0.29%
- Commodities: Gold at $1341.30 (+0.35%), Silver at $17.05 (+0.81%), WTI Oil at $64.53 (+0.09 %), Brent Oil at $69.92 (-0.06 %)
- Rates: US 10-year yield at 2.621, UK 10-year yield at 1.356, German 10-year yield at 0.559
News & Data:
- (NZD) Credit Card Spending y/y 6.3% vs 9.1% previous
- (JPY) Flash Manufacturing PMI 54.4 vs 54.3 expected
- (JPY) Trade Balance 0.09T vs 0.27T expected
- (AUD) MI Leading Index m/m 0.3% vs 0.1% previous
- (EUR) Consumer Confidence 1 vs 1 expected
- (USD) Richmond Manufacturing Index 14 vs 19 expected
- (GBP) CBI Industrial Order Expectations 14 vs 13 expected
- (EUR) ECOFIN Meetings vs previous
- (EUR) ZEW Economic Sentiment 31.8 vs 29.7 expected
- (EUR) German ZEW Economic Sentiment 20.4 vs 17.8 expected
- (GBP) Public Sector Net Borrowing 1.0B vs 4.2B expected
- Senate Confirms Jerome H. Powell as Fed Chairman
- Bank of America raises its 2018 market forecast after S&P 500 surpasses initial target in January
Markets Update:
Asian markets expressed a mixed sentiment. The risk sentiment was a little weaker, with dollar weakness cited for gold's strength. Industrial metals were under pressure, and this also reflected as weakness in ASX miners. Surprise crude inventory builds also dragged crude down.
Nikkei lower as yen posts fresh highs. Japan trade data showed slight export miss but takeaways positive. China mixed with PBoC ramping up liquidity boost. Dollar under notable pressure amid interest in potential policy shifts at other central banks. Takeaways from Tuesday's unchanged BoJ policy move leaned dovish given scrutiny surrounding recent stealth tapering. However, markets continue to eye hawkish policy turn later this year. Few surprises expected from ECB on Thursday, though economists believe concrete QE end-date plan will be in place by June.
Trade has been getting a lot of attention after Trump's tariffs on washing machine and solar imports. However, there has been no real spillover, given the narrow focus and the fact that penalties could have been even tougher. However, there is still a lot of concern about trade tensions that could stem from upcoming decisions, including on China IP theft – although the markets seems to have discounted this.
Uneventful US session with ongoing Q4 earnings strengths leading to S&P500 closing at fresh record. Miners came under pressure as industrial metals selloff and financials lagged amid downshift in yields. Earnings drove a lot of single stock moves – however, no surprises in the results.
The relentless USD selling has pushed the EUR/USD pair to a fresh three-year high of 1.2335 ahead of the preliminary Eurozone PMI release. The move higher in Asia seems to have been triggered by Yen's rise against the USD. The USD/JPY pair dipped below 110.00 in Asia, triggering stops on USD longs and leading to a broad-based USD sell-off.
Upcoming Events:
- 08:00 AM GMT – (EUR) French Flash Manufacturing PMI
- 08:00 AM GMT – (EUR) French Flash Services PMI
- 08:30 AM GMT – (EUR) German Flash Manufacturing PMI
- 08:30 AM GMT – (EUR) German Flash Services PMI
- 09:00 AM GMT – (EUR) Flash Manufacturing PMI
- 09:00 AM GMT – (EUR) Flash Services PMI
- 09:30 AM GMT – (GBP) Average Earnings Index 3m/y
- 09:30 AM GMT – (GBP) Claimant Count Change
- 09:30 AM GMT – (GBP) Unemployment Rate
- 02:00 PM GMT – (USD) HPI m/m
- 02:45 PM GMT – (USD) Flash Manufacturing PMI
- 02:45 PM GMT – (USD) Flash Services PMI
- 03:00 PM GMT – (USD) Existing Home Sales
- 03:30 PM GMT – (AUD) CB Leading Index m/m
- 03:30 PM GMT – (USD) Crude Oil Inventories
- 09:45 PM GMT – (NZD) CPI q/q
- All day – WEF Annual Meetings
- &more…
