The Morning Jumpstart Macro view

OVERNIGHT MARKET SNAPSHOT FOR TUESDAY 30/03/21 (as at 8am AEDT)

  • SPI200 (Jun) overnight futures up 44 pts to 6804
  • SP500 down 3.45 pts to 3971.09
  • NASDAQ Composite down 79.08 pts to 13059.65
  • Dow Jones up 98.49 pts to 33171.37
  • FTSE100 down 4.42 pts to 6736.17
  • DAX30 up 68.78 pts to 14817.72
  • GOLD futures US session (April) down $22.30 to $1710.00 an ounce
  • COPPER futures US session (Comex May) down $0.0.313 to $4.0367 a pound
  • OIL futures US Session (Nymex April) up $0.59 to $61.56 a barrel
  • CRB Index down 0.20 pts to 187.53
  • AUDUSD trading at 0.7634
  • EURUSD trading at 1.1765
  • GBPUSD trading at 1.3766
  • USDJPY trading at 109.8100
  • USD Index US Session (ICE Mar) up 0.178 to 92.953

US indexes were mixed with the SP500 and Nasdaq lower while the DOW ended slightly higher for the session. Traders were on edge with the news of a hedge fund default which muted the days action although optimism for the outlook of the economy managed to limit any serious losses. Bank shares came under pressure as traders expect that there will me more to the story. Investors remain upbeat thanks to speedy vaccinations and record stimulus which supported the action last week and expect that it will continue to do so in coming days while there will be some end of quarter window dressing into portfolios. The DOW closed up 0.30% while the broader SP500 ended down 0.09% and the Nasdaq closed down 0.60% for the session. In Europe, major Indexes edged higher in a relatively range bound market as the DAX pushed up into new all time highs before closing slightly back below. Credit Suisse took a beating and other banks are expected to come under more scrutiny after US based hedge fund Archegos defaulted on margin calls. There is expectations of some flow over into other hedge funds as they may announce they have been stung also. This took a toll on the financial services sector which ended down 1.9%. German Chancellor stepped up pressure to curb rising coronavirus cases and floated the possibility of introducing curfews to get it under control.

The USD Index was pressured to the upside in relatively contained trading. Price is extended but is being supported in the short term and looking set to continue that pressure for an extension into the 94.000 area. The daily anchor to the uptrend is at 91.365 so the pressure on the bears is continuing. Price was supported by a ramp up in yields and fall in bond prices that is expected to continue today in after hours US trading. The EURUSD held below the 1.1817 area and pressured into lows. Bulls managed to hold the level but expect that stop losses will be targeted for a push below 1.1760. If price can break the level cleanly then it paves the way for an extension into 1.1735 lows where we would expect to see a good reaction from buyers. Either way, USD buyers remain in control with the dollar in favour against the Euro until the EU get the latest virus outbreak under control. The GBPUSD was ramped up at the start of the European session before being sold straight back down into the US close to give up all of the gains. The spike up was into a data release on M4 money supply (the amount of currency in circulation and in bank accounts) which came in better than expected. The way it gave up the gains hinted at a short squeeze to clear out some sellers before price settles back down again. If there is further USD pressure higher, expect to see the Pound push down below 1.3750 towards the 1.3670 area. The AUDUSD really lacked any direction from the open of the Asian session until the US close as both bulls and bears pushed price around. Price managed to hold up off 0.7613 after a retest of the level but failed to move higher. Expect that the Aussie is in a holding pattern for now as major indexes pause into the end of the quarter. The USDJPY was knocked down hard in Asian trade in a move that was engineered to clean out some buyers as price was then quick to recover back through previous highs. The move adds to our expectation for continuation up into highs around 112.120 over the coming sessions. Expect that if the move plays out, there may be some profit taking and reaction lower off the area.

SPOT GOLD bulls continue to show weakness and fail to hold and significant level. Price pushed down below the 1722 area over night and took out stop losses to accelerate the move down. We expect that there will be more downside to come as the 1700 area comes under fire in the Asian session if buyers remain on the sidelines. The key is the 1700 level as if this can not hold a bigger move down through 1675 may be on the cards as bulls are continually disappointed. Crude Oil had a good session being supported hard from buyers after the Suez Canal was finally cleared and business is back to normal. Price did see some negative action lower off the highs around 61.75 but was bought up just as hard to close at the same level. The 61.70 level will be key today as many expect that there is lingering pressure on demand from Europe as virus cases increase. This may cap buying for now but the price action and action from buyers off 57.50 suggests that the level will not hold for long. Copper worked its way lower from the open for Asian trade yesterday but the move lower was a grind and did see buyers on the way down. We expect that, like oil, buyers will be looking for increasing demand to provide some support and the action lower does suggest that a ramp higher may be the play in coming sessions if 3.9500 holds.

Cryptocurrencies were lifted in a sharp spike higher after visa said that they will start settling transactions on the Ethereum network. Bitcoin is currently trading at $57420.1 up 4.71% while Ethereum is at $1815.72 up 8.93% and Ripple is at %0.56129 up 3.73%.

The ASX200 moved lower from the open off the important 6860 level as sellers were in control from start to finish. The index ended the day down 24.7 points to 6799.5 with the IT, Consumer Discretionary and Telecom Service sectors weighing most on the action. The Metals and Mining and Materials sectors followed the US and Europes lead to end with gains and be the main investor focus for the day. Falling stocks outnumbered advancing ones by 776 to 534 and 385 ended unchanged.

The ASX200 is expected to open up 40 points after the SPI200 held up off the day sessions lows.

ECONOMIC DATA OUT TODAY (AEDT)

JPY Unemployment Rate 10:30am

JPY Retail Sales 10:50am

EUR German Prelim CPI All Day

USD Consumer Confidence 1am

SPI200 INTRADAY LEVELS TO WATCH