News

Europe Roundup: Sterling hits $1.40 for first time in nearly 3 years, European stocks rise, Gold prices fall,Oil extends losses as Texas prepares to ramp up output-February 19th,2021

Market Roundup

•German Jan PPI (YoY) 0.9%,0.3% forecast, 0.2% previous

•German Jan PPI (MoM) 1.4%, 0.8% forecast, 0.8% previous

•UK Jan Public Sector Net Borrowing 8.02B, 33.38B previous

•UK Jan Retail Sales (MoM) -8.2%, -2.5% forecast, 0.3% previous

•UK Jan Core Retail Sales (YoY) -3.8%,2.2% forecast, 6.4% previous

•UK Jan Core Retail Sales (MoM ) -8.8%, -2.6% forecast, 0.4% previous

•UK Jan Retail Sales (YoY) -5.9%,-1.3% forecast, 2.9% previous

•French Jan HICP (MoM) 0.3%,0.3% forecast, 0.3% previous

•French Jan CPI (MoM) 0.1%,0.2% forecast, 0.2% previous

•French Feb Services PMI 43.6, 47.0 forecast, 47.3 previous

•German Feb Manufacturing PMI 60.6, 56.5 forecast, 57.1 previous

•Italian Jan CPI (MoM ) 0.7%,0.5% forecast, 0.2% previous

•EU Feb Markit Composite PMI 48.1, 48.0 forecast, 47.8 previous

•UK Manufacturing PMI 54.9, 53.2 forecast, 54.1 previous

•UK Services PMI 49.7, 41.0 forecast, 39.5 previous

•UK Composite PMI 49.8, 42.2 forecast, 41.2 previous

Looking Ahead – Economic Data (GMT)

•13:30 Canada Dec Core Retail Sales (MoM) -2.0% forecast, 2.1% previous

•13:30 Canada Retail Sales (MoM) -2.5%forecast, 1.3% previous

•14:45 US Feb Markit Composite PMI 58.7 forecast, 58.3 previous

•14:45 US Feb Markit Composite PMI 58.7 previous

•15:00 US Jan Existing Home Sales 6.61M forecast, 6.76M previous

•15:00 US Jan Existing Home Sales (MoM) -1.5%,0.7% previous

Looking Ahead – Economic events and other releases (GMT)

•15:00US Fed Monetary Policy Report

Fx Beat

EUR/USD: The euro rose against dollar on Friday as single currency was driven up by a surge in global bond yields fuelled by expectations of reflation in the United States. The dollar lost ground, ending its first two-day winning streak in two weeks as disappointing labor market data tempered expectations for a speedy economic recovery from the global health crisis. The euro rose 0.4% to $1.2134. The single currency showed little reaction to purchasing manager index data, which showed a slowdown in business activity in February. However, factories had their busiest month in three years, buoying sentiment. Immediate resistance can be seen at 1.2143(50Fib%), an upside break can trigger rise towards 1.2213 (61.8%fib).On the downside, immediate support is seen at 1.2075(38.2%fib), a break below could take the pair towards 1.2026(16th Feb low).

GBP/USD: Sterling hit $1.40 against the dollar for first time in nearly 3 years on Friday, as investors bet Britain’s quick pace of vaccinations will lead to an economic rebound from the country’s worst crash in output in 300 years.At 12:30 GMT, the pound hit $1.4005 against the dollar, up 0.2% on the day. That level was its highest since April 2018. The pound is the best performing G10 currency this year, up 2.3% against the dollar as investors bet that Britain’s quicker pace of vaccinations will lead to a recovery from the worst annual fall in economic output in three centuries. Immediate resistance can be seen at 1.4032(April 23rd high 2018), an upside break can trigger rise towards 1.4100(Psychological level).On the downside, immediate support is seen at 1.3911(23.6%fib), a break below could take the pair towards 1.3801 (38.2%fib).

USD/CHF: The dollar declined against the Swiss franc on Friday as U.S. dollar was knocked by disappointing jobs data. The U.S. currency had been rising in recent days as a jump in Treasury yields on the back of the so-called reflation trade drew investors. But an unexpected increase in U.S. weekly jobless claims soured the economic outlook and sent the dollar lower.On Friday it traded down 0.3% against a basket of currencies, with the dollar index at 90.309. Immediate resistance can be seen at 0.8943 (50%fib), an upside break can trigger rise towards 0.8981(38.2%fib).On the downside, immediate support is seen at 0.8892(61.8%fib), a break below could take the pair towards 0.8873 (Feb 18th low).

USD/JPY: The dollar declined against the Japanese yen on Friday after disappointing U.S. labour market data bruised optimism for the country’s speedy recovery from the COVID-19 pandemic.The greenback continued to buck its traditional role as a safe-harbour currency, falling in sympathy with U.S. stocks overnight after an unexpected increase in weekly jobless claims soured the economic outlook. The string of soft labour data is weighing on the dollar even as other indicators have shown resilience, and as President Joe Biden’s pandemic relief efforts take shape, including a proposed $1.9 trillion spending package. Strong resistance can be seen at 105.71 (38.2%fib), an upside break can trigger rise towards 106.21(23.6%fib).On the downside, immediate support is seen at 105.28(50%fib), a break below could take the pair towards 104.98 (61.8%fib).

Equities Recap

Euro shares rose on Friday as data showed factory activity in February jumped to its highest in three years, while upbeat quarterly earnings updates from companies including Hermes boosted confidence in a broader economic recovery..

At (GMT 12:20),UK’s benchmark FTSE 100 was last trading downat 0.17 percent, Germany’s Dax was up by 0.71 percent, France’s CAC was last up by 0.74 percent.

Commodities Recap

Gold recouped some losses on Friday after dropping to its lowest in more than seven months, but stayed on course for its biggest weekly drop since end-November as rising U.S. Treasury yields eroded the appeal of non-yielding bullion.

Spot gold was down 0.1% at $1,773 per ounce by 0815 GMT, having touched its lowest since July 2 at $1,759.29 earlier in the session. Spot prices have declined 2.9% so far this week. U.S. gold futures slipped 0.1% to $1,773.20.

Oil prices fell from recent highs for a second day on Friday as Texas energy firms began to prepare for restarting oil and gas fields shuttered by freezing weather.

Brent crude futures were down $1.16, or 1.8%, to $62.77 per barrel, by 1150 GMT, while U.S. West Texas Intermediate (WTI) crude futures fell $1.42, or 2.4%, to $59.10 a barrel.


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