Posted at 28 April 2022 / Categories Market Roundups
Market Roundup
•US Mar Goods Trade Balance -125.32B ,-106.35B previous
•US Wholesale Inventories (MoM) 2.3% ,2.5% previous
•US Mar Retail Inventories Ex Auto 2.3%,1.4% previous
•US Mar Pending Home Sales (MoM) -1.2%, -1.6% forecast,-4.1% previous
•US Crude Oil Inventories 0.692M, 2.000M forecast, -8.020M previous
•US Cushing Crude Oil Inventories 1.298M,-0.185M previous
Looking Ahead Economic Data (GMT)
•02:30 Japan BoJ Interest Rate Decision-0.10% forecast, -0.10% previous
•05:00 Japan Mar Housing Starts (YoY) -0.5% forecast, 6.3% previous
•05:00 Japan Mar Construction Orders (YoY) -2.3% previous
Looking Ahead - Events, Other Releases (GMT)
•02:30 japan BoJ Monetary Policy Statement
Currency Summaries
EUR/USD: The euro fell below $1.06 for the first time in five years against a broadly strong U.S. dollar on Wednesday amid rising concerns around energy safety and growth slowdown in China and Europe. The euro slipped to a five-year low of $1.05860 after Russia’s Gazprom said it would cut gas supply to Poland and Bulgaria, as the crisis in Ukraine deepened. The single currency has fallen more than 4% so far in April and is heading for its worst monthly loss in more than seven years as uncertainty around the war in Ukraine and China’s COVID lockdown measures led traders to ditch the euro in favour of the safe-haven dollar. Immediate resistance can be seen at 1.0700(38.2%fib), an upside break can trigger rise towards 1.0721 (5DMA).On the downside, immediate support is seen at 1.0593(23.6%fib), a break below could take the pair towards 1.0563 (23.6%fib).
GBP/USD: Sterling fell to a new 21-month low against a strengthening dollar on Wednesday after Britain's weak economic outlook and higher than expected government borrowing dented the Bank of England's (BoE) monetary tightening narrative. Money markets have been scaling back bets on the size of BoE rate hikes, pricing in around 140 basis points (bps) worth of tightening by year-end from 160 bps last Friday . Data showed that government borrowing in the 2021/22 financial year was almost 20% higher than forecast. Optimism among British manufacturers has fallen at its fastest pace since the coronavirus crisis, a survey showed on Monday, adding to signs of a slowdown in the economy on the back of rising inflation. Immediate resistance can be seen at 1.2601 (5DMA), an upside break can trigger rise towards 1.2678(38.2%fib).On the downside, immediate support is seen at 1.2558 (23.6%fib), a break below could take the pair towards 1.2500(Psychological level).
USD/CAD: The Canadian dollar was little changed against its U.S. counterpart on Wednesday, holding near its weakest level in more than six weeks, as investors grew more worried that Europe's economy could tip into recession. The safe-haven U.S. dollar climbed against a basket of major currencies as Russia halted gas supplies to Bulgaria and Poland. The loonie was trading nearly unchanged at 1.2830 to the greenback, or 77.94 U.S. cents, after touching its weakest level since March 15 at 1.2854. It followed four straight days of declines .Immediate resistance can be seen at 1.4150 (Daily high), an upside break can trigger rise towards 1.4318 (Higher BB).On the downside, immediate support is seen at 1.4093 (21 DMA), a break below could take the pair towards 1.4003 (9 DMA).
USD/JPY: The dollar strengthened against yen on Wednesday as expectations that the U.S. central bank will be more hawkish than peers boosted dollar. The greenback has also benefited from global growth concerns as Europe struggles with the fallout from Russia’s invasion of Ukraine and China imposes lockdowns in a bid to stem the spread of COVID-19. The stronger dollar also blunted an attempted bounce by the yen, which had seen some support from safety flows and positioning for the risk of a policy shift. The yen last traded at 128.3 per dollar, after hitting a 20-year low of 129.4 last week. Investors will be watching to see whether the Bank of Japan makes any changes to its yield curve control policy in order to stem yen weakness when it concludes its two-day meeting on Thursday . Strong resistance can be seen at 128.14(23.6%fib), an upside break can trigger rise towards 129.04(20th April high).On the downside, immediate support is seen at 127.00(Daily low), a break below could take the pair towards 126.24 (38.2%fib).
Equities Recap
European shares broke a three-day losing streak on Wednesday as basic materials stocks surged 4.5%, while Russian energy giant Gazprom halting gas supplies to Bulgaria and Poland and a plunge in German consumer morale kept gains in check.
UK's benchmark FTSE 100 closed up by 0.53 percent, Germany's Dax ended up by 0.27 percent, France’s CAC finished the day up by 0.48 percent.
Key U.S. equity indexes ended higher after choppy trade on Wednesday on a boost from strong earnings from Microsoft and Visa, as commodity stocks lifted European shares to their first gain in four sessions.
Dow Jones closed down by 1.19%percent, S&P 500 closed up by 0.21% percent, Nasdaq settled down by 0.01 % percent.
Treasuries Recap
Treasury yields slid on Wednesday as data suggesting trade dragged on U.S. economic growth last quarter highlighted the "restrictive" policy the Federal Reserve will pursue next week to combat inflation by slowing economic growth.
The yield on 10-year Treasury notes fell 0.9 basis points to 2.763%.
Commodities Recap
Gold slipped to a more than two-month trough on Wednesday as the dollar rallied on expectations of aggressive monetary policy tightening by the U.S. Federal Reserve.
Spot gold fell 0.8% to $1,890.29 per ounce by 2:06 p.m. ET (1806 GMT), after dropping to $1,881.45, its lowest level since Feb. 24.U.S. gold futures settled down 0.8% at $1,888.7.
Oil prices rose modestly on Wednesday due to ongoing concerns about tight worldwide supply, underscored by another drawdown in U.S. distillate and gasoline inventories.
Brent crude futures settled up 33 cents to $105.32 a barrel, while U.S. West Texas Intermediate crude settled up 32 cents to $102.02 a barrel.