A volatile week for equities and currencies

Thursday, April 02, 2015

It has been a volatile week for global equity and commodity prices. The uncertainty regarding the Greek debt issues continue to weigh on market sentiment adding further pressure to the euro which hovers around 1.08 against the USD.

Investors remain cautious as Greece has to pay the IMF loan instalment next week, while its Economy Minister George Stathakis said that the country expects to wrap up negotiations with its creditors “very soon, possibly next week”, according to Bloomberg. In the meantime, The Greek Prime Minister Alexis Tsipras and Russian President Vladimir Putin plan to discuss EU-Russia relations including tourism, investment and energy, trade as well as regional and international developments in Moscow, on 8th April.  European equity markets were mixed today as the CAC, IBEX and London equity benchmark indices gained between 0.10% and 0.50%, while the DAX index slid lower falling by 0.35%.

On the macroeconomic front, US factory orders rose unexpectedly by 0.2% in February against expectations of a 0.4% drop, while the ISM NY manufacturing dropped sharply to 50.0 in March compared to 63.1 in February. Weekly jobless claims declined to 268,000 last week beating estimates of 286,000 and Challenger layoffs rose 6.4% in March. The USD index dropped sharply towards 97.50 against a basket of currencies.

However, the softer US dollar failed to provide any support to crude oil prices which continued their downside momentum. Brent front month futures declined sharply over 3% to retest $55 per barrel while WTI front month futures fell below $50 per barrel amid ongoing concerns regarding record high levels of crude oil inventories. Copper was under pressure in today’s session retreating below $6,000, while other base metal prices bucked the downtrend and posted strong gains during the last trading session of the week.

The UK and European equity markets are closed tomorrow, Friday 3rd April and Monday 6th April due to Easter Holiday, while the US markets will be closed just tomorrow for US.  

EURUSD reboundes towards 1.0850

EURUSD Curncy (EUR-USD X-RATE)   2015-04-02 09-16-33

Copper 3M retreats below $6000

LMCADS03 Comdty (LME COPPER    3 2015-04-02 16-12-21

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