News

Europe Roundup: Sterling consolidates amid holiday-thinned trading, oil surges as U.S. prepares to tighten Iran sanctions, investors’ eye U.S. housing data – Monday, April 22nd, 2019

Market Roundup

  • U.S. set to end sanctions waivers for Iran oil
     
  • Brent, U.S. crude oil futures surge to near 6-month high

Economic Data Ahead

  • (0830 ET/1230 GMT) The Federal Reserve Bank of Chicago will release its Chicago Fed National Activity Index (CFNAI) for the month of March. The index stood at -0.29 in the prior month.
     
  • (1000 ET/1400 GMT) National Association of Realtors is likely to report that U.S. existing home sales declined 2.3 percent to an annual rate of 530,000 million units in March from 5.51 million units in February.
     

Key Events Ahead

  • No significant events scheduled

FX Beat

DXY: The dollar index gained as the yield on the benchmark 10-year Treasury yield rose 1-1/2 basis points to 2.572 percent. The greenback against a basket of currencies traded 0.05 percent up at 97.40, having touched a high of 97.49 on Thursday, its highest since Apr. 2. FxWirePro's Hourly Dollar Strength Index stood at 42.34 (Neutral) by 1100 GMT.

EUR/USD: The euro rose, extending previous session gains after finance minister Olaf Scholz ruled out taking on new debt to stimulate Germany's slowing economy. The European currency traded 0.1 percent up at 1.1248, having touched a high of 1.1323 on Wednesday, its highest since Mar. 26. FxWirePro's Hourly Euro Strength Index stood at -3.10 (Neutral) by 1100 GMT. Immediate resistance is located at 1.1287 (Apr. 10 High), a break above targets 1.1331 (Mar. 25 High). On the downside, support is seen at 1.1213 (Mar. 28 Low) a break below could drag it till 1.1176 (Mar. 7 Low).

USD/JPY: The dollar steadied as concerns about the health of the world economy eased after last week's Chinese economic data continued to cheer investor sentiment. The major was trading flat at 111.91, having hit a high of 112.16 on Wednesday, its highest since Dec. 20. FxWirePro's Hourly Yen Strength Index stood at 98.32 (Slightly Bullish) by 1100 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. existing home sales, and the Chicago Fed National Activity Index. Immediate resistance is located at 112.60 (Dec. 20 High), a break above targets 113.24 (Dec. 5 High). On the downside, support is seen at 111.20 (Apr. 3 Low), a break below could take it lower at 110.53 (Mar. 20 Low).

GBP/USD: Sterling consolidated below the 1.3000 handle, as financial markets in Britain and many major countries in Europe remained closed for the Easter holiday. The major traded flat at 1.2989, having hit a low of 1.2978 on Friday; it’s lowest since Mar. 29. FxWirePro's Hourly Sterling Strength Index stood at -33.53 (Neutral) 1100 GMT. Immediate resistance is located at 1.3074 (Apr. 8 High), a break above could take it near 1.3149 (Apr. 1 High). On the downside, support is seen at 1.2960 (Mar. 11 Low), a break below targets 1.2924 (Feb. 5 Low). Against the euro, the pound was trading 0.1 percent down at 86.61 pence, having hit a low of 86.80 on Wednesday, it’s lowest since Mar. 22.

USD/CHF: The Swiss franc eased, as the greenback held firm on the back of a gradual rise in U.S. 10-year Treasury yields and signs of strength in the economy. The major trades 0.1 percent up at 1.0148, having touched a high of 1.0159 on Thursday; it’s highest since Mar. 11. FxWirePro's Hourly Swiss Franc Strength Index stood at -11.45 (Neutral) by 1100 GMT. On the higher side, near-term resistance is around 1.0178 (Jan. 10 2017 High) and any break above will take the pair to next level till 1.0220 (Jan. 5 2017 High). The near-term support is around 1.0103 (5-DMA), and any close below that level will drag it till 1.0058 (10-DMA)

Equities Recap

Britain, Germany, France and other major Eurozone markets remain closed on account of Easter Monday.

Commodities Recap

Crude oil surged over 2-percent to hit their highest since November as the United States is set to announce a further clampdown on Iranian oil exports, tightening global supplies. International benchmark Brent crude was trading 2.4 percent higher at $73.66 per barrel by 1055 GMT, having hit a high of $74.28 earlier, its highest since Nov. 1, 2018. U.S. West Texas Intermediate was trading 2.4 percent up at $65.48 a barrel, after rising as high as $65.97, its highest since the Oct. 31, 2018.

Gold prices rose, hovering away from a near 4-month trough touched in the previous session, amid subdued trading activity. Spot gold was trading 0.3 percent up at $1,279.52 per ounce by 1027 GMT, having touched a low of $1,271.07 in the previous session, its lowest since Dec. 27, 2018.

Treasuries Recap

The U.S. Treasuries remained narrowly mixed amid a silent trading day that witnessed data of little economic significance. The yield on the benchmark 10-year Treasury yield rose 1-1/2 basis points to 2.572 percent, the super-long 30-year bond yields also surged 1-1/2 basis points to 2.973 percent while the yield on the short-term 2-year traded nearly 1 basis point lower at 2.378 percent.

The Japanese government bonds remained higher at the time of closing amid a muted trading session that witnessed data of little economic significance ahead of the Bank of Japan’s (BoJ) monetary policy meeting, scheduled to be held on April 25. The yield on the benchmark 10-year JGB note, which moves inversely to its price, slumped 3 basis points to -0.029 percent, the yield on the long-term 30-year slipped nearly 1 basis point to 0.581 percent and the yield on short-term 2-year plunged 15 basis points to -0.149 percent.


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