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Market movers today

Markets will continue to monitor Brexit developments and whether there is any breakthrough in the negotiations between PM May and Labour leader Jeremy Corbyn .

In the euro area, we get minutes from the March ECB meeting , where the ECB announced a new series of TLTRO3, opened the door for further easing and extended the forward guidance to rates to the end of 2019. We are particularly interested in the details of the discussion of the TLTRO3 announcement from members of the Governing Council. Judging from recent communication, the ECB has become increasingly concerned about the side effects of a prolonged period of negative rates on bank profitability. However, we do not expect a discussion on a tiered deposit system to already have taken place. At 08:00 CEST, we also get German factory orders for February, which we will monitor given the weakness seen in the German manufacturing sector lately.

In the US , Fed's Mester and Harker are speaking in the evening.

Selected market news

Despite a late rally in the US session sending S&P500 to the highest close since early October, risk sentiment in the Asian session has been fairly mixed this morning. 10Y Treasury yields continue to hover just above 2.50%, EUR/USD is little changed (see FX section) and Brent Crude remains below USD70/bbl.

Late yesterday evening, the UK House of Commons narrowly backed a bill to stop a no-deal exit by 313 votes to 312. The legislation was opposed by May and the Conservative group of hard brexiteers who want a clean break with the EU on 12 April. The bill will now move to the upper chamber of Parliament to be completed today. GBP was little changed.

The vote followed the kick-off of historical cross-party negotiations between May and Corbyn that has infuriated many pro-Brexit Conservatives and which yesterday led to the resignation of two ministers. Both parties stated the initial talks were "constructive" yet also "inconclusive". Both sides are preparing for a full day of negotiations today. A key topic will be that of the customs union, which the Labour Party would like but which in many ways invalidates the arguments of a Brexit in the first place.

According to Bloomberg , the US is said to be setting 2025 targets for China to fulfil trade pledges, which should involve commitments on commodity purchases and allow US companies to wholly own enterprises in China. The trade negotiations continue in Washington today.

In Norway, house price data from Real Estate Norway showed a March rise of 0.3% m/m s.a. This was slightly higher than most Nordic houses had called for yet in line with Norges Bank's revised projection. Generally, there is still a widespread expectation among economists that house prices will rise modestly this year as higher supply, higher mortgage rates, lower population growth and tight regulation are countered by a strong rise in real disposable income growth and high activity. We still pencil in the next rate hike from Norges Bank in June and another one in December this year.

For the 24 hours to 23:00 GMT, the EUR rose 0.35% against the USD and closed at 1.1243.

On the macro front, the Euro-zone's final services PMI unexpectedly climbed to a level of 53.3 in March, compared to a level of 52.8 in the previous month. The preliminary figures and market participants had envisaged the PMI to drop to a level of 52.7. Moreover, the region's seasonally adjusted retail sales advanced 2.8% on a yearly basis in February, surpassing market expectations for a rise of 1.5%. In the previous month, retail sales had recorded a gain of 2.2%. Separately, in Germany, the final services PMI surprisingly rose to a level of 55.4 in March, defying market anticipations for a fall to a level of 54.9. The PMI had registered a reading of 55.3 in the prior month, while preliminary figures had recorded a decline to a level of 54.9.

The US dollar declined against its major currencies yesterday, amid weak US jobs data.

In the US, data indicated that the ADP private sector employment growth slowed to an 18-month low level by 129.0K in March, following a revised rise of 197.0K in the preceding month. Market participants had anticipated the private sector employment to advance to 180.0K. Further, the final Markit services PMI fell to a level of 55.3 in March, notching a 19-month low level and compared to a reading of 56.0 in the previous month. The preliminary figures and market participants had expected the PMI to ease to a level of 54.8. Moreover, the nation's ISM non-manufacturing PMI declined to a level of 56.1 in March, marking its weakest level since mid-2017 and compared to a level of 59.7 in the previous month. Markets had expected the PMI to fall to a level of 58.0. On the contrary, the MBA mortgage applications rallied to a 2.5-year high level of 18.6% on a weekly basis in the week ended 29 March 2019, boosted by gains in refinancing activity and following a rise of 8.9% in the prior week.

In the Asian session, at GMT0300, the pair is trading at 1.1238, with the EUR trading a tad lower against the USD from yesterday's close.

The pair is expected to find support at 1.1217, and a fall through could take it to the next support level of 1.1196. The pair is expected to find its first resistance at 1.1257, and a rise through could take it to the next resistance level of 1.1276.

Moving ahead, traders would closely monitor Germany's factory orders for February and the Markit construction PMI for March, set to release in a few hours. Later in the day, the US initial jobless claims, will keep investors on their toes.

The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.

For the 24 hours to 23:00 GMT, the GBP rose 0.37% against the USD and closed at 1.3177, on fresh hopes of another Brexit extension.

In economic news, Britain's services PMI declined to a level of 48.9 in March, contracting for the first time in 2.5 years, amid mounting uncertainties over Brexit. In the previous month, the PMI had recorded a reading of 51.3, while market participants had envisaged for a fall to a level of 50.9.

In the Asian session, at GMT0300, the pair is trading at 1.3174, with the GBP trading slightly lower against the USD from yesterday's close.

The pair is expected to find support at 1.3132, and a fall through could take it to the next support level of 1.3090. The pair is expected to find its first resistance at 1.3206, and a rise through could take it to the next resistance level of 1.3238.

In absence of key economic releases in UK today, investor sentiment would be determined by global macroeconomic events.

The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.

For the 24 hours to 23:00 GMT, the USD rose 0.13% against the JPY and closed at 111.47.

In the Asian session, at GMT0300, the pair is trading at 111.42, with the USD trading marginally lower against the JPY from yesterday’s close.

The pair is expected to find support at 111.31, and a fall through could take it to the next support level of 111.19. The pair is expected to find its first resistance at 111.56, and a rise through could take it to the next resistance level of 111.69.

The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the USD declined 0.07% against the CHF and closed at 0.9974.

In the Asian session, at GMT0300, the pair is trading at 0.9978, with the USD trading slightly higher against the CHF from yesterday’s close.

The pair is expected to find support at 0.9959, and a fall through could take it to the next support level of 0.9939. The pair is expected to find its first resistance at 0.9993, and a rise through could take it to the next resistance level of 1.0007.

Amid no major economic releases in Switzerland today, investors would focus on global macroeconomic factors for further direction.

The currency pair is trading above its 20 Hr moving average and showing convergence with its 50 Hr moving average.

For the 24 hours to 23:00 GMT, the USD slightly rose against the CAD and closed at 1.3342.

In the Asian session, at GMT0300, the pair is trading at 1.3350, with the USD trading 0.06% higher against the CAD from yesterday’s close.

The pair is expected to find support at 1.3314, and a fall through could take it to the next support level of 1.3277. The pair is expected to find its first resistance at 1.3369, and a rise through could take it to the next resistance level of 1.3387.

Moving forward, investors would await Canada’s Ivey Purchasing Managers’ Index for March, slated to release later in the day.

The currency pair is trading above its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the AUD rose 0.79% against the USD and closed at 0.7118.

LME Copper prices rose 0.8% or $52.0/MT to $6483.0/MT. Aluminium prices rose 0.4% or $7.0/MT to $1865.0/MT.

In the Asian session, at GMT0300, the pair is trading at 0.7117, with the AUD trading marginally lower against the USD from yesterday’s close.

The pair is expected to find support at 0.7099, and a fall through could take it to the next support level of 0.7082. The pair is expected to find its first resistance at 0.7132, and a rise through could take it to the next resistance level of 0.7148.

Looking ahead, traders would await Australia’s AiG performance of construction index for March, scheduled to release overnight.

The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.

For the 24 hours to 23:00 GMT, Gold declined 0.12% against the USD and closed at USD1294.70 per ounce.

In the Asian session, at GMT0300, the pair is trading at 1294.80, with gold trading marginally higher against the USD from yesterday’s close.

The pair is expected to find support at 1292.00, and a fall through could take it to the next support level of 1289.20. The pair is expected to find its first resistance at 1298.30, and a rise through could take it to the next resistance level of 1301.80.

The yellow metal is showing convergence with its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, Silver rose 0.20% against the USD and closed at USD15.11 per ounce.

In the Asian session, at GMT0300, the pair is trading at 15.09, with silver trading 0.13% lower against the USD from yesterday’s close.

The pair is expected to find support at 15.01, and a fall through could take it to the next support level of 14.92. The pair is expected to find its first resistance at 15.17, and a rise through could take it to the next resistance level of 15.24.

The white metal is showing convergence with its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, Crude Oil declined 0.06% against the USD and closed at USD62.44 per barrel, after the Energy Information Administration (EIA) report indicated that US crude oil stockpiles advanced by 7.2 million barrels to 449.5 million barrels in the week ended 29 March 2019.

In the Asian session, at GMT0300, the pair is trading at 62.42, with oil trading a tad lower against the USD from yesterday’s close.

The pair is expected to find support at 61.98, and a fall through could take it to the next support level of 61.55. The pair is expected to find its first resistance at 62.92, and a rise through could take it to the next resistance level of 63.43.

Crude oil is showing convergence with its 20 Hr and 50 Hr moving averages.