Stock continue to sit near all time highs while the dollar is somewhat mixed on Tuesday, albeit a little heavy against the EU majors and the Yen, ahead of Donald Trump’s address to Congress that is due to take place at 9.00 EST (around lunch time in Asia). He has indicated that he will outline his plans for restructuring Obamacare, infrastructure spending, anti terrorism, tax reform and trade. In terms of data, the Q4 US GDP rose at a 1.9% annual rate, unchanged from the previous quarter, with downward revisions to business and government investment offsetting robust consumer spending. The dollar showed some mild strength late in the session following some hawkish Fed remarks from Dudley, Williams and Harker, all hinting that a rate hike is on its way sooner rather than later.
Wednesday will be busy, but really all about Donald trump who is due to address Congress during the Asian time zone. If he fails to deliver, then both stocks and the dollar could see a sharp fall so be nimble! Elsewhere, AUD traders will need to be alert, as the Q4 GDP (exp 0.7% qq, 1.9% yy) is due for release about an hour before he starts speaking, meaning that it will be pretty choppy there for a couple of hours at least. The other main focus of the day will be on the global Mfg PMIs, led off by Australia, China and Japan and followed later in the day by those of the EU and US. The German provisional CPI (exp 0.6%mm, 2.1%yy) and Unemployment (exp -10K, 5.9%) for January and the US Personal Consumption/Expenditure figures, the Construction Spending and Total Vehicle Sales are also due, as are Fed speeches from Kaplan and Brainard, both due late in the day. Look out for what Brainard, a noted dove, has to say. If she has toughened up her stance, a March rate hike is probably on the cards. Until then all eyes will be on Donald Trump.
EURUSD: The Euro was slightly firmer as French election polls favoured Macron over Le Pen although the US$ is generally a little firmer on some hawkish Fed speak. Now likely to hold steady ahead of Trump.
USDJPY: US$ initially traded heavily, with doubts about Trump’s tax plan/speech outweighing other influences, but has seen a decent bounce late in the day, back to wards the session highs.
GBPUSD: Rangebound. Pressured by Brexit concerns
AUDUSD: Rangebound before a late US selloff
NZDUSD: Rangebound, initially slightly firmer ahead of some late selling out of the US..
US STOCKS: A touch lower but still close to all time highs
ASX SPI: Heavy
OIL: WTI fell more than 1% early in the session, as concerns grow about rising U.S. crude inventories. It then bounced back sharply on the news that OPEC has cut its oil output for a second month, allowing producers to boost the already strong compliance with the agreed supply restrictions on the back of a steep supply reduction by Saudi Arabia.
The levels in this table are a guide only. For more in depth analysis please go the “Articles” tab at the top of the page and scroll down.
|INDICES / COMMODITIES|
|ASX SPI: 5680|
|OIL (WTI): 53.91|