Posted at 24 March 2022 / Categories Market Roundups
Market Roundup
• Canada Wholesale Sales (MoM) 0.9%, 4.2% previous
• US New Feb Home Sales (MoM) -2.0%,-8.4% previous
• US Feb New Home Sales 772K, 810K, 801K previous
• US Crude Oil Inventories-2.508M, 0.114M forecast, 4.345M previous
• US Crude Oil Imports -0.817M , -0.438M previous
• US Cushing Crude Oil Inventories 1.235M, 1.786M previous
• US Gasoline Inventories -2.947M, -1.986M forecast, -3.616M forecast
•EU March Consumer Confidence -18.7, -12.9 forecast,-8.8 forecast
Looking Ahead Economic Data (GMT)
•00:30 Japan March Manufacturing PMI 53.5 forecast, 52.7 previous
• 00:30 Japan Services PMI 44.2 previous
Looking Ahead - Events, Other Releases (GMT)
• 00:00 Japan Monetary Policy Meeting Minutes
• 01:30 Japan BoJ Board Member Kataoka Speaks
Cirrency Summaries
EUR/USD: The euro weakened against the dollar on Wednesday amid another sharp increase in oil and natural gas prices and while investors waited for U.S. President Joe Biden to unveil new sanctions against Russia during his trip to Europe.Biden, who's heading to Brussels for talks with NATO and European leaders, will push Europe to reduce its reliance on Russian oil and gas, and could announce new sanctions on members of the Russian parliament over Moscow's invasion of Ukraine. The euro opened broadly flat but gradually lost ground against the greenback and fell about 0.4% below the $1.10. Immediate resistance can be seen at 1.1038(38.2%fib), an upside break can trigger rise towards 1.1124 (50%fib).On the downside, immediate support is seen at 1.0988(14DMA), a break below could take the pair towards 1.0933 (23.6%fib).
GBP/USD: Sterling softened slightly against the dollar on Wednesday, after British finance minister Rishi Sunak announced measures to ease the UK’s cost-of-living squeeze and inflation hit a 30-year high. The pound was down 0.4% against a strengthening U.S. dollar at $1.32095. Sunak cut taxes for workers and reduced a duty on fuel against the backdrop of slowing economic growth and fast-rising inflation.The announcement came after figures showed inflation at 6.2% in February, up 5.5% in the 12 months to February 2022, more than the 5.9% rise expected by the market. Immediate resistance can be seen at 1.3250 (50%fib), an upside break can trigger rise towards 1.3315(61.8%fib).On the downside, immediate support is seen at 1.3190 (38.2%fib), a break below could take the pair towards 1.3108 (23.6%fib).
USD/CAD : The Canadian dollar was little changed against the greenback on Wednesday, with the currency holding near a two-month high as recent dialing back of financial market volatility led to investors focusing more on the upswing in commodity prices. U.S. stock markets fell on Wednesday but were trading well above their February lows, while the price of oil, one of Canada's major exports, settled 5.2% higher at $114.93 a barrel. The loonie was trading nearly unchanged at 1.2562 to the greenback , after touching its strongest level since Jan. 21 at 1.2543. Immediate resistance can be seen at 1.2577(5DMA), an upside break can trigger rise towards 1.2623 (38.2%fib).On the downside, immediate support is seen at 1.2549 (23.6%fib), a break below could take the pair towards 1.2504 (Lower BB).
USD/JPY: The dollar hit six-year high against the yen on Wednesday as rising commodity costs and expectations of a quicker Federal Reserve tightening steadied dollar against yen. High commodity prices have been a clear negative for the yen , as Japan imports the bulk of its energy, widening the country's trade deficit. Bank of Japan Governor Haruhiko Kuroda said on Tuesday it was premature to debate an exit from ultra-loose policy, including how to whittle down its massive holdings of exchange-traded funds (ETF).The currency slipped to a new six-year high of 121.415 per dollar overnight but later recouped its losses and ticked up 0.05% at 121.12 per dollar. Strong resistance can be seen at 121.42 (23.6%fib), an upside break can trigger rise towards 121.85(Higher BB).On the downside, immediate support is seen at 120.65(38.2%fib), a break below could take the pair towards 112.25(50%fib).
Equities Recap
European shares opened modestly higher on Wednesday, extending gains to a sixth session, as a sell-off in bonds left cash on the table for risk, although worries lingered about the economic fallout of the Ukraine crisis.
UK's benchmark FTSE 100 closed down by 0.22 percent, Germany's Dax ended down by 1.31 percent, France’s CAC finished the day down by 1.15 percent.
Wall Street pushed stocks and Treasury yields down on Wednesday after both had powered higher earlier in the week as investors took in the strength of the economy and hawkish comments from U.S. policymakers.
Dow Jones closed down by 1.29% percent, S&P 500 closed down by 1.23% percent, Nasdaq settled down by 1.06% percent.
Treasuries Recap
A sharp sell-off in U.S. Treasuries eased on Wednesday as the market tried to get to grips with how the Federal Reserve might address high inflation without boosting interest rates at such a clip that it could spin the economy into recession.
The yield on 10-year Treasury notes fell 2 basis points to 2.357%, while the gap between yields on two- and 10-year notes was at 21.9 basis points after collapsing to 13.5 on Tuesday.