Global Markets:
- Asian stock markets: Nikkei down 1.18%, Shanghai Composite up 2.03%, Hang Seng down 1.46%, ASX up 0.12%
- Commodities: Gold at $1324.9 (-0.54%), Silver at $16.400 (-1.31%), WTI Oil at $61.06 (-1.01%), Brent Oil at $64.92 (-0.76%)
- Rates: US 10-year yield at 2.941, UK 10-year yield at 1.551, German 10-year yield at 0.723
News & Data:
- (GBP) Public Sector Net Borrowing -11.6B vs -11.5B expected
- (GBP) Claimant Count Change -7.2K vs 2.3K expected
- (GBP) Average Earnings Index 3m/y 2.50% vs 2.50% expected
- (EUR) Flash Services PMI 56.7 vs 57.7 expected
- (EUR) Flash Manufacturing PMI 58.5 vs 59.2 expected
- (EUR) German Flash Services PMI 55.3 vs 56.9 expected
- (EUR) German Flash Manufacturing PMI 60.3 vs 60.6 expected
- (EUR) French Flash Services PMI 57.9 vs 59.1 expected
- (EUR) French Flash Manufacturing PMI 56.1 vs 58.1 expected
- Japan's FX Head Asakawa: BOJ Easing Isn't Designed To Weaken Yen
- Fed's Quarles pushes for gradual rate hikes, review of crisis-era bank regulations
Markets Update:
Asian markets traded lower today following overnight cues from the Wall Street. The speculation of faster rate hikes in the US dampened risk appetite globally. Nikkei underperformed, as yen strengthened from recent lows against the dollar.
While bond proxies have been pacing ASX’s declines, the index continues to be supported by good earnings. Chinese markets have defied the trend, and were seen in the green, after returning from the week-long Lunar New Year break.
The retreat came after minutes of the Federal Reserve's last policy meeting showed the usual concerns that inflation might disappoint, but also an expectation of faster economic growth due to fiscal stimulus. Three rate rises are now almost fully priced in for this year, compared to two as recently as December.
Yields on 10-year notes touched their highest in four years, and those on two-year paper the highest in nine. The lift in yields provided much needed support to the US Dollar, with the US dollar index up by more than 0.3%. However, against the yen, the dollar lost some value, owing to the yen’s perception as a safe haven currency, and investors moving to it.
The higher yields pulled down precious metals, especially gold – given that it now looks ales lucrative investment as compared to GSecs. Negative risk sentiment also continues to contribute to the weaker metals,
Upcoming Events:
- 09:00 AM GMT – (EUR) German Ifo Business Climate
- 09:30 AM GMT – (GBP) Second Estimate GDP q/q
- 09:30 AM GMT – (GBP) Prelim Business Investment q/q
- 12:30 PM GMT – (EUR) ECB Monetary Policy Meeting Accounts
- 01:30 PM GMT – (CAD) Core Retail Sales m/m
- 01:30 PM GMT – (CAD) Retail Sales m/m
- 01:30 PM GMT – (USD) Unemployment Claims
- 04:00 PM GMT – (USD) Crude Oil Inventories
- 05:10 PM GMT – (USD) FOMC Member Bostic Speaks
- 09:45 PM GMT – (NZD) Retail Sales q/q
- 09:45 PM GMT – (NZD) Core Retail Sales q/q
- &more…
