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OVERNIGHT MARKET
UPDATE:
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·
US’s Chicago PMI undershot market expectations in March at 46.3
and remains well below its peak of +64.5 in October 2014. Overall, the regional
Fed surveys are consistent with a further softening in the ISM manufacturing
survey.
·
The conference board consumer confidence data in US was upbeat,
with the headline number bouncing back to 101.3 in March. Overall, consumer
confidence remains high and reflects the impact of improving labour market
conditions and the boost to incomes from lower oil prices.
·
Euro area CPI data was marginally weaker than expected in March.
Headline CPI was lower by 0.1% y/y, while core inflation came in at 0.6% y/y in
March.
·
Euro area unemployment printed at 11.3% in February down from an
upwardly revised 11.4% in January. Sharp divergences remained across countries.
The unemployment rate continued to drift higher in France and remains elevated
at 12.7% in Italy, highlighting the importance of substantive economic and
labour market reforms. In Germany, however, the unemployment rate fell to a
fresh low of 6.4%.
·
In UK, the final print for Q4 GDP was revised higher to 3.0% y/y
(from +2.7% y/y). Meanwhile, the current account deficit narrowed to GBP25.3bn
from a revised GBP27.7bn in Q3.
·
In the currency market, the USD remained broadly strong with
confidence high. EUR weakened on Greek issues, despite strong fundamental data.
GBP strengthened after Q4 GDP positively surprised.
·
US Treasuries yields fell marginally over the curve with the
10-year yields down 2 bps.
·
US equities trimmed gains, falling 0.8%-1.1%, following previous
session’s sharp rise.
·
Crude oil prices fell as the market awaits the results of the
Iran nuclear deal. Speculation that the parties involved in the negotiations
have moved closer to a preliminary deal on curbing Tehran's nuclear program
pressured
prices.
Gold prices were marginally lower but traded in a tight range.
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