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The comdolls (NZD, AUD, and CAD) were in a race to the bottom during the morning London session, apparently because of another bout of risk aversion and Trump’s rhetoric on trade wars being “good” and “easy to win.”

  • German retail sales m/m: -0.7% vs. 0.8% expected, -1.1% previous
  • German import prices m/m: 0.5% vs, 0.4% expected, 0.3% previous
  • Spanish unemployment change: -6.3K vs. -7.2K expected, 63.7K previous
  • U.K. construction PMI: 51.4 vs. 50.5 expected, 50.2 previous
  • Euro Zone PPI m/m: 0.4% as expected vs. 0.2% previous
  • British PM Theresa May will be speaking later
  • Canada’s GDP report coming up

Major Events/Reports:

The Donald tweets

Trump tweeted the following earlier. And, well, it pretty much speaks for itself.

U.K. construction PMI

The U.K.’s construction PMI reading for the month of February came in at 51.4, which is an upside surprise since the consensus was that it would only improve slightly from 50.2 to 50.5.

However, commentary from Markit was more mixed since Markit pointed out that commercial work drove most of the gains. Other construction work didn’t fare as well. In fact, civil engineering activity fell “at the sharpest pace for five months” while residential building construction “remained on track for its weakest quarter since Q3 2016.”

Moreover, “New business volumes fell during February.” And survey respondents cited “a headwind from political uncertainty and a continued lack of tender opportunities to replace completed work on infrastructure projects” as the likely reasons.

Oil slips further as other commodities recover

After getting kicked lower during the past few days, most commodities staged a broad-based recovery. Although oil was one commodity that quite notably failed to attract buyers.

The broad-based commodities rally was likely due to bargain-buying sparked by the Greenback’s relative weakness for the day.

And for reference, the U.S. dollar index was down by 0.33% to 89.92 for the day when the session ended.

As to why oil extended its losses, market analysts blamed that on higher U.S. oil inventories and rising U.S. oil output.

Base metals were in recovery mode today.

  • Copper was up by 0.26% to $3.131 per pound
  • Nickel was up by 0.58% to $13,467.50 per dry metric ton

Precious metals were really in demand, likely because of the risk-off vibes.

  • Gold was up by 1.39% to $1,323.30 per troy ounce
  • Silver was up by 1.13% to $16.460 per troy ounce

Oil benchmarks just couldn’t attract enough buyers to prop them up.

  • U.S. WTI crude oil was down by 0.48% to $60.70 per barrel
  • Brent crude oil was down by 0.49% to $63.52 per barrel

Intense risk-off vibes to end the week

Europe has been plagued by risk aversion this week. And that didn’t really change today since another round of intense risk-off vibes pushed the major European equities lower.

And today’s bout of risk aversion was blamed by market analysts on fears of a potential trade war due to Trump’s announcement yesterday that he plans to slap tariffs on aluminum and steel imports, as well as Trump’s earlier tweet about his eagerness to engage in trade wars.

  • The pan-European FTSEurofirst 300 was down by 1.55% to 1,445.51
  • Germany’s DAX was down by 1.52% to 12,247.00
  • The blue-chip Euro Stoxx 50 was down by 1.03% to 3,404.50

U.S. equity futures were also crushed by all that risk aversion in Europe.

  • S&P 500 futures were down by 0.45% to 2,666.25
  • Nasdaq futures were down by 0.75% to 6,710.25

Major Market Mover(s):

Comdolls

The comdolls (NZD, AUD, CAD) really got the stuffing beaten out of ’em during the morning London session, very likely because of the intense risk-off vibes and fears of a potential trade war after Trump upped the ante with his tweet earlier.

Interestingly enough, commodities were actually in recovery mode during the session, but they failed to provide any support for the comdolls. Well, in the case of NZD and AUD to be more precise, since the slide in oil prices likely weighed on CAD.

AUD/USD was down by 12 pips (-0.16%) to 0.7748, AUD/JPY was down by 41 pips (-0.50%) to 81.64, AUD/CHF was down by 42 pips (-0.59%) to 0.7248

NZD/USD was down by 34 pips (-0.47%) to 0.7234, NZD/JPY was down by 62 pips (-0.81%) to 76.22, NZD/CHF was down by 62 pips (-0.90%) to 0.6766

USD/CAD was up by 36 pips (+0.28%) to 1.2873, EUR/CAD was up by 103 pips (+0.65%) to 1.5846, GBP/CAD was up by 74 pips (+0.42%) to 1.7749

CHF

The Swissy was the main beneficiary of all that risk aversion since even the mighty yen lost out to the Swissy.

USD/CHF was down by 41 pips (-0.44%) to 0.9353, GBP/CHF was down by 41 pips (-0.32%) to 1.2895 , EUR/CHF was down by 10 pips (-0.09%) to 1.1512

Watch Out For:

  • 1:30 pm GMT: British PM Theresa May is expected to give a speech on Brexit
  • 1:30 pm GMT: Canada’s monthly GDP (0.1% expected, 0.4% previous)
  • 3:00 pm GMT: University of Michigan’s revised consumer sentiment (99.5 expected, 99.9 previous)
  • 3:00 pm GMT: University of Michigan’s revised consumer sentiment (2.7% previous)