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Not much on the docket for today’s morning London session, so the themes from the earlier Asian session continued to play out, with the comdolls extending their gains and the yen retreating further.

  • Swiss PPI m/m: -0.2% vs. 0.0% expected, 0.1% previous
  • Macron will supposedly name the new French PM
  • U.K. Prime Minister Theresa May will be speaking later

Major Events/Reports:

Macron to name new French PM?

According to a Reuters report, New French President Emmanuel Macron’s office announced that the new French Prime Minister will be revealed at around 12:30 pm GMT. No specifics, though.

Commodities extend gains

Commodities added to their winnings from the earlier Asian session, with oil still at the head of the pack, thanks to the earlier announcement that Russia and Saudi Arabia agreed to extend OPEC’s oil cut deal.

Precious metals climbed higher.

  • Gold was up by 0.32% to $1,231.57 per troy ounce
  • Silver was up by 1.46% to $16.641 per troy ounce

Base metals scored more gains.

  • Copper was up by 0.91% to $2.547 per pound
  • Zinc was up by 1.18 to $2,580.75 per dry metric ton

Oil benchmarks were still leading the way.

  • U.S. WTI crude oil was down by 2.93% to $49.24 per barrel
  • Brent crude oil was down by 2.83% to $52.28 per barrel

The U.S. dollar index was down by 0.29% to 98.76 for the day when the session ended, which may have helped stoke demand for commodities.

However, some market analysts are still pointing to the general “feel good” vibes for commodities because of the OPEC deal extension, as well as potentially lower supply from China.

Risk sentiment flips back to risk-off

Returning risk appetite during the Asian session initially helped to push European equity indices higher. However, risk aversion would later make a comeback, kicking equity indices lower again.

  • The pan-European FTSEurofirst 300 was down by 0.10% to 1,553.72
  • Germany’s DAX was down by 0.24% to 12,744.00
  • The blue-chip Euro Stoxx 50 was down by 0.24% to 3,625.50

The risk-on vibes at the start was obviously from the surge in oil prices, which helped energy shares outperform. As for the returning risk-off vibes, that’s not very clear, although profit-taking ahead of Theresa May’s speech and Macron’s announcement later is a possibility.

Major Market Mover(s):

Comdolls

Commodities extended their gains during the session, so the comdolls (NZD, AUD, CAD) naturally found another wave of buyers as well.

AUD/JPY was up by 53 pips (+0.63%) to 84.42, AUD/CHF was up by 18 pips (+0.24%) to 0.7425

NZD/JPY was up by 39 pips (+0.51%) to 78.36, NZD/CHF was up by 8 pips (+0.12%) to 0.6893

EUR/CAD was down by 20 pips (-0.13%) to 1.4924, GBP/CAD was down by 65 pips (-0.37%) to 1.7579

JPY

The early risk-on vibes really put the hurt on the safe-haven Swissy. When risk aversion began to return later, however, the yen only managed to gain traction against the Greenback, which is rather weird. Maybe jitters over North Korea’s missile test is still dampening safe-haven demand for the yen?

USD/JPY was up by 11 pips (+0.10%) to 113.49, GBP/JPY was up by 27 pips (+0.19%) to 146.58, CAD/JPY was up by 46 pips (+0.56%) to 83.37

EUR

The euro put up a good fight against the comdolls but still lost anyway. Even so, the euro actually managed to win out against all its other peers. There were no apparent catalysts for the euro’s strength, however, although it’s possible that profit-taking by euro longs in the wake of Macron’s victory is finally over.

EUR/USD was up by 35 pips (+0.33%) to 1.0965, EUR/JPY was up by 53 pips (+0.43%) to 124.44, EUR/GBP was up by 21 pips (+0.26%) to 0.8490

USD

There were no apparent catalysts but the Greenback began getting sellers during the session and ended up as the second worst-performing currency of the session. Another interesting thing worth noting is that the yen began to chip away at the Greenback about halfway through the session, which allowed the yen to recover from some of its earlier losses against the Greenback.

AUD/USD was up by 39 pips (+0.52%) to 0.7439, NZD/USD was up by 28 pips (+0.42%) to 0.6906, GBP/USD was up by 11 +0.09% 1.2914,

Watch Out For:

  • 12:30 pm GMT: U.S. Empire State manufacturing index (7.2 expected, 5.2 previous)
  • 12:30 pm GMT: Macron to name a new French PM (?)
  • 2:00 pm GMT: NAHB U.S. housing market index (steady at 68 expected)
  • 7:00 pm GMT: U.K. Prime Minister Theresa May will speak