Euro hits 11-year low

Thursday, March 05, 2015

European equity markets rebounded strongly in today’s trading session, while the euro remained under further pressure, trading around 1.10 against the US dollar. The CAC, DAX, IBEX and London equity benchmark index gained between 0.65% and 1.1%, spreading an optimistic tone across the US markets as the Dow Jones, S&P 500 and NASDAQ climbed higher within the recent range.

EUR hits 11-year low against the US dollar

EURUSD Curncy (EUR-USD X-RATE)   2015-03-05 16-08-27

On the macroeconomic front, the Bank of England and the European Central Bank held interest rates unchanged at their current low levels, providing further support to equity markets. The BoE left rates at their historical low of 0.5% and held its quantitative easing asset purchase programme at £375 bln.

In the US, factory orders declined 0.2% in January against analysts’ estimates of a 0.2% rise, while initial jobless claims rose to 320,000 for the week ending 21st February missing estimates of a 295,000 increase. Challenger layoffs surged unexpectedly 20.9% in February compared to 17.6% in January, raising renewed concerns regarding the current US employment conditions. However, all eyes will be on the release of the US non-farm payroll data tomorrow. 

The London equity benchmark index rebounded towards the key psychological level of 7,000, as robust earnings results from Aviva and Schroders improved market sentiment. Aviva’s shares surged over 7.5% in today’s trading session after reporting pre-tax operating profits of $2.173 bln, a rise of 6%. Other insurance companies also followed the uptrend as Friends Life Group and Standard Life climbed higher 7.2% and 3.8%, respectively.

XAU- Gold hovers around $1200/ounce

XAU Curncy (Gold Spot   $_Oz )  2015-03-05 16-09-20

Precious metal prices climbed higher with gold trading back to $1,210 and silver rebounding towards $16.50. Platinum and palladium also posted strong gains, while base metal prices were also all higher on the day. The US dollar continues its strong upside rally today as the USD index has been currently holding above 96.2 against a basket of currencies.      

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