Asia Recap
NIKKEI
14,718.34
+255.93
+1.77%
HANG SENG
21,962.98
+383.72
+1.78%
S&P/ASX 200
5,254.50
+32.35
+0.62%
News Events
Actual
Forecast
AUD NAB Business Confidence
8
AUD HPI q/q
3.4%
3.2%
AUD NAB Business Confidence
-1.9%
0.5%
Headlines
Aussie Rises as Home Prices to Confidence Gain; Dollar Declines — Bloomberg — Australia’s dollar reached a four-week high after home prices and business sentiment climbed. Demand for the greenback against the yen was limited before Federal Reserve Chairman Janet Yellen speaks to U.S. lawmakers. The Aussie rose against its major peers, while the U.S. dollar weakened versus all but three of its 16 biggest counterparts. Data this week may show U.S. retail sales stalled and Chinese import growth slowed. A gauge of global currency volatility dropped to the least in more than two weeks.
Aussie Climbs to Four-Week High on Home Prices; Morgan Says Buy — Bloomberg — The Australian dollar climbed to its highest level in four weeks as home prices rose at the fastest pace since 2010 and business confidence strengthened, adding to signs the nation’s economy is gaining momentum. Australian bonds fell, pushing the yield premium two-year notes offer over the U.S. to the highest level since April 2013. New Zealand’s currency also gained as Asian stocks advanced for a fifth day, spurring demand for higher-yielding assets. Appetite for the South Pacific nations’ currencies was also supported before Federal Reserve Chairman Janet Yellen delivers her first semi-annual monetary-policy testimony as investors weigh the pace of stimulus reductions in the U.S.
China Bulls in Australia Belie $1.4 Trillion Stocks Rout — Bloomberg — Australian policy makers see little evidence of a slump in China’s economic growth, defying global pessimism that helped wipe $1.4 trillion from stocks this year. The Reserve Bank of Australia and the nation’s Treasury forecast the world’s second-largest economy will expand 7.5 percent this year. The view is underpinned by a 21 percent expansion in Australia-China trade to a record A$141.8 billion ($127.7 billion) in 2013, led by shipments of iron ore, a key ingredient of the steel used to build the skyscrapers, subways and bridges transforming China’s cities.
Europe Recap
STOXX 50
3,058.33
+25.80
+0.85%
FTSE 100
6,642.56
+51.01
+0.77%
DAX
9,406.91
+117.05
+1.26%
News Events
Actual
Forecast
GBP BRC Retail Sales Monitor y/y
3.9%
Headlines
Pound Reaches One-Week High Versus Dollar as Retail Sales Rise — Bloomberg — The pound climbed to the strongest level in a week against the dollar after an industry report showed U.K. retail sales growth accelerated in January, adding to evidence the recovery is gaining momentum. The U.K. currency was little changed against the euro. The British Retail Consortium said like-for-like retail sales jumped 3.9 percent from a year earlier after increasing 0.4 percent in December. Economists surveyed by Bloomberg forecast an increase of 0.8 percent. The Bank of England is scheduled to release new forecasts for economic growth and consumer prices in its quarterly Inflation Report tomorrow.
Gold Climbs to Highest Level This Year Before Yellen Testimony — Bloomberg — Gold rallied to the highest level since November as investors assessed further cuts to U.S. stimulus and Chinese buyers increased purchases to extend last year’s record consumption. Silver, platinum and palladium rose. Bullion for immediate delivery gained as much as 1 percent to $1,287.81 an ounce, the highest price since Nov. 18, and was at $1,283.85 by 3:01 p.m. in Singapore. A fifth day of advance would be the longest such run since August, when bullion gained 5.3 percent. Silver added 0.2 percent to $20.1175 an ounce, climbing for an eighth day in the longest rally since August.
House to Vote Feb. 12 on U.S. Debt-Limit Increase Plan — Bloomberg — The House plans to vote Feb. 12 to increase the U.S. debt limit and restore cost-of-living raises for military retirees, said Representative Robert Pittenger of North Carolina. The plan was announced in a closed-door meeting of House Republicans, Pittenger told reporters today in Washington. The debt limit would be raised until March 2015, said Republican Representative Joe Pitts of Pennsylvania.
Carney Faces Traders as BOE Updates Rates Guidance: U.K. Credit — Bloomberg — Bank of England Governor Mark Carney is set to present an updated version of his forward-guidance policy as he seeks to encourage investor expectations that the next increase in interest rates is some time away. Yields suggest Carney has convinced investors that there is enough slack in the economy to maintain the benchmark interest rate at a record 0.5 percent this year. The short-sterling contract expiring in March 2015 has fallen 26 basis points since Dec. 31 to 0.85 percent.
Today’s Session Highlights
An interesting day today – USD Fed Chair Yellen Testifies could see some market action. Focus is around USD this morning and CAD this afternoon. Some interest in AUD, JPY and CNY after hours. All news releases as per the table below.
Forecast
Previous
9:00am
USD
FOMC Member Plosser Speaks
10:00am
USD
Fed Chair Yellen Testifies
USD
JOLTS Job Openings
4.04M
4.00M
4:00pm
CAD
Annual Budget Release
6:30pm
AUD
Westpac Consumer Sentiment
-1.7%
6:50pm
JPY
Core Machinery Orders m/m
-4.1%
9.3%
JPY
Tertiary Industry Activity m/m
-0.2%
0.6%
Tentative
CNY
Trade Balance
24.2B
25.6B