America’s Roundup: Dollar eclipses euro and pound amid European banking worries, Wall Street ends higher, Gold eases, Oil prices fall on worries about European banks and US crude inventories-March 25th,2023

Posted at 24 March 2023 / Categories Market Roundups

Market Roundup

•Canada Manufacturing Sales (MoM) -2.8%, 4.1% previous

•Canada Wholesale Sales (MoM) -1.6%,2.4% previous

•US  Feb Durables Excluding Defense (MoM)  -0.5%,-5.1% previous

•US  Feb Durable Goods Orders (MoM) -1.0%, 0.6% forecast,-4.5% previous

•US  Feb Goods Orders Non Defense Ex Air (MoM) 0.2%, 0.1% forecast,  0.8% previous

•US  Core Durable Goods Orders (MoM)  0.0%,0.2% forecast, 0.8% previous

•Canada Jan Retail Sales (MoM)  1.4%,0.7% forecast,0.5% previous

•Canada Jan Core Retail Sales (MoM)  0.9%,0.6% forecast,-0.6% previous

•US  Mar Manufacturing PMI  49.3,47.0 forecast,47.3 previous

•US Mar S&P Global Composite PMI 53.3, 47.5 forecast,50.1 previous

•US Mar Services PMI 53.8, 50.5 forecast,50.6 previous

•EU Mar Belgium NBB Business Climate -7.6,-12.8 previous

•U.S. Baker Hughes Oil Rig Count 593, 589 previous

•U.S. Baker Hughes Total Rig Count 758, 754 previous

Looking ahead Economic data(GMT)

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Looking ahead events and other releases(GMT)

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Currency Summaries

EUR/USD: The euro fell sharply against a strengthening dollar on Friday amid nervousness over banks, with better-than expected economic data failing to lift sentiment.Flash Purchasing Managers' Index (PMI) data failed to lift the single currency as sentiment in markets were fragile with European banks  falling 5.3%.S&P Global's flash Composite Purchasing Managers' Index (PMI), seen as a good gauge of overall economic health, bounced to a 10-month high of 54.1 in March from February's 52.0, data showed on Friday. The euro sank 1% to $1.0722. The dollar index , which measures the currency against six major rivals, rose 0.6% at 103.26.Immediate resistance can be seen at 1.0838 (23.6%fib), an upside break can trigger rise towards 1.0880 (Higher BB).On the downside, immediate support is seen at 1.0725(38.2%fib), a break below could take the pair towards  1.0684(14DMA).

GBP/USD: Sterling declined on Friday as another rout in banking stocks that sent investors fleeing into safe-haven assets. European bank stocks have been at the epicentre of a sell-off in equity markets this week after the emergency rescue of Credit Suisse  by UBS   ignited concern about the fragility of the banking sector in light of rising rates and also raised questions about lenders' cost of funding. Sterling was on track to rise 0.2% this week after the Bank of England raised interest rates as expected on Thursday and data earlier in the week showed inflation remained above 10% in February.The pound was last down 0.6% at $1.2229. Immediate resistance can be seen at 1.2294 (Daily high), an upside break can trigger rise towards 1.2349(Higher BB).On the downside, immediate support is seen at 1.2211 (38.2%fib), a break below could take the pair towards 1.2178(11DMA).

 USD/CAD: The Canadian dollar weakened to a nine-day low against its U.S. counterpart on Friday before recouping much of its decline, as investors weighed global banking sector stress and data showing some major sectors of Canada's economy weakening in February. Wall Street bounced back from an earlier sell-off at the end of a tumultuous week as U.S. Federal Reserve officials calmed investor skittishness over a potential liquidity crisis in the banking sector. The loonie was trading 0.1% lower at 1.3730 to the greenback, or 72.83 U.S. cents, after touching its weakest level since March 15 at 1.3804. For the week, the currency was barely changed. Immediate resistance can be seen at 1.3801 (23.6%fib), an upside break can trigger rise towards 1.3856 (Higher BB).On the downside, immediate support is seen at 1.3711(38.2%fib), a break below could take the pair towards 1.3696 (5 DMA).

USD/JPY: The dollar initially dipped against yen on Friday but recovered some ground as investors assessed the prospects that the U.S. Federal Reserve might pause its rate-hike trajectory. The U.S. Fed on Wednesday delivered an expected interest rate hike of 25 basis points, but took a cautious stance on economic outlook due to the recent banking sector turmoil. The markets will be closely watching next week's readout of the personal consumption expenditures (PCE) price index, due March 31, for indications as to how the print could influence the Fed's upcoming rate decisions. Strong resistance can be seen at 131.45(5DMA), an upside break can trigger rise towards 132.45 (38.2%fib).On the downside, immediate support is seen at 129.76(23.6%fib), a break below could take the pair towards 129.00(Psychological level).

Equities Recap

A steep sell-off in banking stocks hit European indexes on Friday as worries about the stability of the financial sector intensified, with Deutsche Bank tumbling as cost of insuring the German bank's debt against the risk of default jumped to a more than four-year high.

 UK's benchmark FTSE 100 closed down by 1.26 percent, Germany's Dax ended down  by 1.66 percent, France’s CAC finished the day down by 1.74 percent.

U.S. stocks closed higher on Friday, marking the end of a tumultuous week as Federal Reserve officials calmed investor fears over a potential liquidity crisis in the banking sector.

Dow Jones closed up  by  0.41% percent, S&P 500 closed up by 0.56% percent, Nasdaq settled up by 0.31%  percent.

Treasuries Recap

U.S. Treasury yields dropped to six-month lows on Friday as concerns about further stress in the banking sector led investors to seek out the safe haven debt.

Benchmark 10-year note yields   fell as low as 3.285%, the lowest since Sept. 12. Two-year yields   reached 3.555%, the lowest since Sept. 13.

Commodities Recap

Gold dipped on Friday in a volatile week that saw bullion prices north of the key $2,000 figure as bank contagion fears bolstered both safe-haven demand and bets on a pause in Federal Reserve rate hikes.

Spot gold fell 0.8% to $1,977.01 per ounce by 2:34 p.m. EDT (1834 GMT), after it rose to $2,002.89 earlier in the session. U.S. gold futures slipped 0.6% to settle at $1,983.80.

Oil prices settled lower on Friday as European banking shares fell and after U.S. Energy Secretary Jennifer Granholm said refilling the country's Strategic Petroleum Reserve (SPR) may take several years, dampening demand prospects.

Brent crude settled down 92 cents, or 1.2%, to $74.99. West Texas Intermediate U.S. crude futures fell 70 cents, or 1%, to $69.26 a barrel.

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