Posted at 16 May 2019 / Categories Market Roundups
Market Roundup
Economic Data Ahead
Key Events Ahead
FX Beat
DXY: The dollar index steadied as U.S. officials said President Donald Trump was expected to delay implementing tariffs on imported cars and parts by up to six months. The greenback against a basket of currencies traded flat at 97.58, having touched a high of 97.70 on Wednesday, its highest since May 7. FxWirePro's Hourly Dollar Strength Index stood at 2.92 (Neutral) by 1100 GMT.
EUR/USD: The euro trimmed gains after data showed the European Union's trade surplus in goods with the United States decreased in the first three months of 2019. The European currency traded 0.05 percent up at 1.1205, having touched a high of 1.1263 on Monday, its highest since May 1. FxWirePro's Hourly Euro Strength Index stood at -17.53 (Bearish) by 1100 GMT. Immediate resistance is located at 1.1262 (April 22 High), a break above targets 1.1304 (April 18 High). On the downside, support is seen at 1.1187 (May 1 Low) a break below could drag it till 1.1140 (April 24 Low).
USD/JPY: The dollar consolidated within narrow ranges, as U.S. sanctions on Chinese telecoms giant Huawei threaten fresh tensions with China. The major was trading 0.05 percent up at 109.66, having hit a low of 109.01 on Monday, its lowest since Feb. 1. FxWirePro's Hourly Yen Strength Index stood at 113.40 (Highly Bullish) by 1100 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of U.S. building permits, housing starts, unemployment benefit claims, and Fed's Brainard's speech. Immediate resistance is located at 110.04 (38.2% retracement of 111.68 and 109.01), a break above targets 110.67 (61.8% retracement). On the downside, support is seen at 109.01 (May 14 Low), a break below could take it lower at 108.49 (Jan. 31 Low).
GBP/USD: Sterling plunged to a 3-month low as the fate of Britain's Prime Minister Theresa May and her Brexit deal hung in the balance, renewing concerns of a disorderly departure from the European Union. The major traded 0.2 percent down at 1.2812, having hit a low of 1.2811 earlier; it’s lowest since Feb. 15. FxWirePro's Hourly Sterling Strength Index stood at -159.91 (Highly Bearish) 1100 GMT. Immediate resistance is located at 1.2916 (Apr. 25 High), a break above could take it near 1.2963 (Apr. 24 High). On the downside, support is seen at 1.2772 (Feb. 14 Low), a break below targets 1.2709 (Jan. 11 Low). Against the euro, the pound was trading 0.3 percent down at 87.44 pence, having hit a low of 87.45, it’s lowest since Feb. 19.
USD/CHF: The Swiss franc eased, as the greenback rose on news that U.S. President Donald Trump was planning to delay tariffs on auto imports. The major trades 0.05 percent up at 1.0092, having touched a low of 1.0049 on Monday; it’s lowest since Apr. 16. FxWirePro's Hourly Swiss Franc Strength Index stood at 115.26 (Highly Bullish) by 1100 GMT. On the higher side, near-term resistance is around 1.0159 (Apr. 18 High) and any break above will take the pair to next level till 1.0196 (May 6 High). The near-term support is around 1.0032 (Apr. 16 Low), and any close below that level will drag it till 1.0000.
Equities Recap
European shares rallied, despite the U.S. administration imposing severe sanctions on the Chinese telecoms giant Huawei.
The pan-European STOXX 600 index gained 0.4 percent at 379.49 points, while the FTSEurofirst 300 index surged 0.3 percent to 1,491.83 points.
Britain's FTSE 100 trades 0.3 percent up at 7,316.43 points, while mid-cap FTSE 250 rallied 0.5 to 19,475.51 points.
Germany's DAX rose 0.7 percent at 12,179.62 points; France's CAC 40 trades 0.3 percent higher at 5,392.10 points.
Commodities Recap
Crude oil prices rose, extending gains for the third straight day as fears of supply disruptions amid heightened tensions in the Middle East overshadowed rising U.S. crude inventories. International benchmark Brent crude was trading 0.3 percent higher at $72.08 per barrel by 1027 GMT, having hit a high of $72.56 on Monday, its highest since Apr, 30. U.S. West Texas Intermediate was trading 0.7 percent up at $62.50 a barrel, after rising as high as $63.32 on Monday, its highest since the May 2.
Gold prices declined despite Washington imposing sanctions on Chinese telecoms giant Huawei. Spot gold was trading 0.2 percent down at $1,294.16 per ounce at 1047 GMT, having touched a high of $1,303.21 on Tuesday, its highest since Apr. 11. U.S. gold futures were also steady at $1,298.10 an ounce.
Treasuries Recap
The 10-year U.S. Treasuries yield eased to 2.371 percent, near its 15-month low of 2.340 percent touched on March 28. The two-year notes yield stood at 2.1616 percent, having hit a 15-month low of 2.139 percent on Wednesday.
The German 10-year bond yield was down almost two basis points on the day at minus 0.11 percent, having hit its lowest in around 2-1/2 years on Wednesday at minus 0.13 percent. France's 10-year bond yield is trading at just 0.3 percent, close to its lowest since late 2016. Dutch 10-year bond yields were not far from turning negative.
The Japanese government bond prices edged up across the board, with the 10-year JGB yield down half-a-basis point at minus 0.060 percent. The 20-year and 30-year yields both declined by a basis point to 0.350 percent and 0.520 percent, respectively.
The yields on Australian three-year bonds were already down at all-time lows of 1.204 percent having fallen 60 basis points so far this year. The three-year bond futures firmed 4 ticks to 98.810, while the 10-year contract added 3.5 ticks to 98.3300.
The New Zealand two-year bond yields were down at 1.398 percent, a long way from where they started the year at 1.715 percent.