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The Kiwi was the best-performing currency of the earlier Asian session. However, the Kiwi had a reversal of fortune during the morning London session, and ended up at the bottom of the heap.

Other noteworthy currencies include the euro, which had decent two-way action but still ended up being the top dog of the session, and the yen, since it was the second-weakest currency of the session.

  • German PPI m/m: 0.0% vs. 0.1% expected, 0.2% previous
  • German PPI y/y: 3.1% vs. 3.2% expected, 3.1% previous

Major Events/Reports:

Brexit guidelines amended – The Financial Times has somehow acquired a copy of the European Council’s amended Brexit guideline. And The Financial Times was even kind enough to share it far and wide, so read it here, if you’re interested.

By the way, you can read the original draft here.

Scanning quickly through the amended guidelines, it looks like the EU’s tone is more forceful when it comes to citizens’ rights, since the EU is saying that guaranteeing the rights of both UK and EU citizens “will be the first priority for the negotiations.”

The EU also added the following demand:

“Citizens should be able to exercise their rights through smooth and simple administrative procedures.”

Other than that, the EU also demands a “single financial settlement” from the U.K. (i.e. the U.K. should pay up), “including [on] issues related to the European Central Bank (ECB), the European Investment Bank (EIB) and the European Development Fund (EDF).”

The guidelines didn’t really seem to cause a stir in the pound’s price action, though. But then again, the pound did see some sellers after the guidelines were released, erasing the pound’s small gains from earlier and causing pound pairs to end up flat or with minor losses for the session.

Commodities rally some more – Commodities staged another broad-based rally during today’s morning London session.

Oil benchmarks led the way.

  • U.S. crude oil was up by 0.90% to $51.31 per barrel
  • Brent crude oil was up by 1.01% to $53.46 per barrel

Base metals also got some loving.

  • Copper was up by 0.49% to $2.547 per pound
  • Nickel was up by 0.76% to $9,457.50 per dry metric ton

Meanwhile, precious metals only printed small gains, except gold, which printed a loss.

  • Gold was up down 0.26% to $1,280.00 per troy ounce
  • Silver was up by 0.04% to $18.170 per troy ounce

The broad-based commodities rally was likely stoked by the Greenback’s weakness, which made globally-traded commodities relatively cheaper, since they’re generally priced in U.S. dollars.

And for reference, the U.S. dollar index was down by 0.21% to 99.50 for the day when the session ended. Although the Greenback’s price action was actually mixed during the morning London session.

Precious metals were underperforming, though, or losing in gold’s case, very likely because of weaker safe-haven demand due to the returning risk-on vibes during the session.

In contrast, oil benchmarks outperformed. And market analysts attributed the rise in oil prices to reports that Saudi Arabia and Kuwait were hinting that OPEC’s oil cut deal would likely get extended beyond June.

European bourses open lower, but risk sentiment recovers – Most European equity indices opened in the red and then went proceeded to dig deeper into the red. They later found a bottom, though, and proceeded to claw their way back up into positive territory.

  • The pan-European FTSEurofirst 300 was only up by 0.03% to 1,481.52, but reached a low of 1,477.20 earlier.
  • Germany’s DAX was only up by 0.04% to 12,021.50 after reaching a low of 11,945.75 earlier
  • The blue-chip Euro Stoxx 50 was already up by 0.31% to 3,434.50

U.S. equity futures were also in positive territory.

  • S&P 500 futures were up by 0.27% to 2,340.00
  • Nasdaq futures were up by 0.33% to 5,415.38

Market analysts say the recovering risk sentiment was due to optimism around earnings and positive reports for individual companies, as well as news from yesterday that UBS upgraded European banks from “underweight” to “”neutral”.

Major Market Mover(s):

NZD – After a strong showing during the Asian session, the Kiwi ended up being the worst-performing currency of the morning London session. There were no apparent catalysts and risk sentiment was recovering, so the Kiwi’s weakness was probably due to profit-taking.

NZD/USD was down by 26 pips (-0.37%) to 0.7021, NZD/JPY was down by 9 pips (-0.11%) to 76.58, NZD/CHF was down by 24 pips (-0.34%) to 0.6994

JPY – The safe-haven yen was the second weakest currency of the morning London session, very likely because of the recovering risk sentiment during the session.

USD/JPY was up by 29 pips (+0.27%) to 109.09, CAD/JPY was up by 8 pips (+0.11%) to 80.86, CHF/JPY was up by 26 pips (+0.24%) to 109.51

EUR – The euro was the one currency to rule them all, although the euro actually had two-way price action during the course of the session.

The euro started the session by jumping higher. There were no clear catalysts, but market analysts attributed the euro’s jump to profit-taking by euro shorts ahead of the French presidential elections.

The euro later began to show weakness, though. No clear reason why, but it’s possible that the returning risk-on vibes may have been weighing down on the lower-yielding euro.

EUR/USD was up by 8 pips (+0.07%) to 1.0748 with 1.0777 as session high, EUR/JPY was up by 36 pips (+0.32%) to 117.22 with 117.49 as session high, EUR/CAD was up by 33 pips (+0.23%) to 1.4497 with 1.4528 as session high

Watch Out For:

  • 12:30 pm GMT: U.S. initial jobless claims (241K expected, 234K previous)
  • 12:30 pm GMT: Philadelphia Fed manufacturing index (25.6 expected, 32.8 previous)
  • 2:00 pm GMT: Euro Zone consumer confidence (unchanged at -5 expected)
  • 2:00 pm GMT: CB’s U.S. leading index (0.2% expected, 0.6% previous)
  • 3:30 pm GMT: BOE Governor Mark Carney will speak
  • 4:30 pm GMT: BOE Governor Mark Carney will speak again
  • 5:15 pm GMT: U.S. Treasury Secretary Steven Mnuchin has a speech