Friday 27th February: European Open Briefing

Feb 27, 2015 Trading Desk Fundamental Analysis Comments Off

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Global Markets:

• Asian stock markets: Nikkei up 0.05 %, Shanghai Composite gained 0.50 %, Hang Seng rose 0.25 %, ASX 0.35 % higher
• Commodities: Gold at $1209.90 (-0.05 %), Silver at $16.60 (-0.10 %), WTI Oil at $48.95 (+1.60 %), Brent Oil at $60.85 (+0.80 %)
• Rates: US 10 year yield at 2.014, UK 10 year yield at 1.745, German 10 year yield at 0.307

News & Data:

• Japan National CPI 2.4 % y/y, Expected: 2.4 %, Previous: 2.4 %
• Japan National Core CPI 2.2 % y/y, Expected: 2.3 %, Previous: 2.5 %
• Japan Household Spending -0.3 % m/m, Expected: 0.4 %, Previous: 0.4 %
• Japan Household Spending -5.1 % y/y, Expected: -4.1 %, Previous: -3.4 %
• Japan Industrial Production 4.0 % m/m, Expected: 2.7 %, Previous: 0.8 %
• Japan Retail Sales -2.0 % y/y, Expected: -1.3 %, Previous: 0.2 %
• Japan Unemployment Rate 3.6 %, Expected: 3.4 %, Previous: 3.4 %
• Japan Housing Starts -13.0 %, Expected: -11.3 %, Previous: -14.7 %
• New Zealand ANZ Business Confidence 34.4 %, Previous: 30.4 %
• Australia Private Sector Credit 0.5 % m/m, Expected: 0.5 %, Previous: 0.5 %

Markets Update:

The US Dollar strengthened across the board yesterday after the US CPI & Durable Goods Orders data. EUR/USD broke below the key 1.1260/70 support area and stops in good size were cleared on the way down to 1.1240. The pair eventually extended losses to 1.1180 and continues to trade with an offered tone. A retest of the former 1.1260/70 support area will likely attract decent selling interest and the next bear target is the 1.11 level. GBP/USD closed above 1.54 on the day and had a decent bounce in Asia. Short-term techs still remain fairly bullish as long as the pair remains above 1.5330/40 support. USD/JPY gave back some of its gains, but remained well bid in Asia. Key intraday support at 118.70, while the pivotal level to the topside remains 119.80.

Upcoming Events:

• 08:30 GMT – Swedish GDP
• 08:30 GMT – Swedish Retail Sales (0.4 % m/m, 3.8 % y/y)
• 10:00 GMT – Italian CPI (0.1 % m/m, -0.5 % y/y)
• 13:00 GMT – German CPI (0.7 % m/m, -0.2 % y/y)
• 13:00 GMT – German HICP (0.7 % m/m, -0.4 % y/y)
• 13:30 GMT – US GDP (2.1 % q/q)
• 14:45 GMT – US Chicago PMI (58.0)
• 15:00 GMT – US Pending Home Sales (1.8 % m/m)

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