15 March 2017

Currency Markets the dollar wobbled in a narrow range in Asian trading on Wednesday, as investors waited anxiously to see what clues the U.S. Federal Reserve would soon reveal on its monetary policy outlook. Against its Japanese counterpart, the greenback edged up 0.1 percent to 114.81. Sterling nursed its losses after tumbling to an eight-week low of $1.2110 in the previous session, amid worries about a prolonged and painful process of the UK’s exit from the European Union. It was last steady on the day at $1.2166. The euro edged up 0.1 percent to $1.0614. The dollar index, which tracks the greenback against a basket of six rival currencies, was flat at 101.71.

 

Commodities Markets U.S. oil prices rose more than 2 percent in early Asian trade on Wednesday, recovering from a three-month low after industry data showed a surprise drawdown in U.S. crude stockpiles and Goldman Sachs put a positive spin on OPEC’s compliance with output cuts. U.S. West Texas Intermediate crude was trading up 1.5 percent, at $48.42 a barrel. Brent futures were up 1.2 percent, at $51.52, after settling down 43 cents at $50.92 on Tuesday, the lowest finish since November. U.S. crude stocks fell by 531,000 barrels last week, industry group the American Petroleum Institute said on Tuesday after settlement. Spot gold edged up 0.3 percent to $1,201.64 per ounce.

 

US Equity Markets  stocks fell on Tuesday as oil prices fell to their lowest since November and airlines pulled industrial stocks down as a blizzard hit the U.S. Northeast. The S&P 500 lost 0.34 percent, to 2,365.45 and the Nasdaq Composite fell 0.32 percent, to 5,856.82. Airline stocks fell as a blizzard swept through the heavily populated northeastern United States, grounding thousands of flights. United Continental fell 4.7 percent while Southwest Airlines lost 3.0 percent and American Airlines lost 2.7 percent. Shares of hospital operators fell after the U.S. Congressional Budget Office forecast that 14 million Americans would lose medical insurance by next year under a Republican plan to dismantle Obamacare.

 

Bond Markets Japanese government bond prices inched down on Wednesday as the debt market braced for upcoming central bank meetings, although sagging equities and a regular debt purchasing operation by the Bank of Japan helped limit the losses. The two-year and 10-year JGB yields both rose half a basis point to minus 0.255 percent and 0.090 percent, respectively. U.S. benchmark 10-year yields were down about 2 basis points at 2.591 percent, from 2.607 percent late Monday.

 

Asian Equity Markets stocks fell on Wednesday as investors took profits before a U.S. central bank policy meeting that could signal how much monetary tightening to expect during the remainder of the year, with an immediate rate hike fully priced in by markets.  The MSCI’s broadest index of Asia-Pacific stocks outside Japan was down 0.3 percent after posting its second-biggest daily gain this year in the previous session. Japan’s benchmark Nikkei average was down 0.3 percent while stocks in South Korea and Australia declined 0.2 and 0.5 percent respectively. The broader Topix fell 0.4 percent to 1,569.15 and the JPX-Nikkei Index 400 was down 0.3 percent at 14,049.60.