America’s Roundup: Dollar slips as banking turmoil roils markets, Wall Street ends sharply lower, Gold surges, Oil prices settle down, post big weekly losses on bank fears-March 18th,2023

Posted at 18 March 2023 / Categories Market Roundups

Market Roundup

•Wall Street, European stock indexes fall

•Focus on Fed policy meeting next week

•Gold to shine through the chaos - analyst

•All precious metals head for weekly gains

•Canada Feb IPPI (MoM)  -0.8%,-0.1% forecast,0.4% previous

•Canada Feb IPPI (YoY)  1.4%,5.4% previous

•Canada Jan Foreign Securities Purchases 4.21B, 14.25Bforecast,21.22B previous

•Canada Feb RMPI (MoM) -0.4%,0.0% forecast,-0.1% previous

•Canada Jan Foreign Securities Purchases by Canadians -16.18B, -2.29B previous

•US Feb Manufacturing Production (MoM) -5.2%,-0.2%forecast,1.0% previous

•US Feb Industrial Production (YoY) -0.25%, 3.00% forecast,0.79% previous

•US Feb Capacity Utilization Rate  78.0%, 78.5%forecast,78.3% previous

•US Feb Industrial Production (MoM) 0.0%,0.2% forecast,0.0% previous

•US Mar Michigan Inflation Expectations 3.8%,4.1% previous

•US Mar Michigan 5-Year Inflation Expectations 2.80%,2.90% previous

•US Mar Michigan Consumer Sentiment  63.4, 66.9 forecast , 67.0 previous

•US Mar Michigan Consumer Expectations 61.5, 64.5 forecast  ,64.7 previous

•US Mar Michigan Current Conditions 66.4,70.0 forecast,70.7 previous

•US  Feb Leading Index (MoM) -0.3%,-0.3% forecast,-0.3% previous

•US 4-Week Bill Auction               4.220% ,4.640% previous

Looking Ahead  Economic Data(GMT)

•No data ahead

Looking ahead events and other releases(GMT)

•No significant events

Currency Summaries

EUR/USD: The euro strengthened on Friday as dollar slipped as an unfolding crisis in the banking sector grabbed headlines and spooked investors. Concerns have spread to Europe, as Credit Suisse shares stumbled over liquidity worries, prompting policymakers to scramble to reassure markets. The European Central Bank (ECB) went ahead with a hefty 50-basis-point rate hike at its policy meeting on Thursday.ECB policymakers sought to reassure investors that euro zone banks were resilient and that if anything, the move to higher rates should bolster their margins.The euro's reaction to the decision was fairly muted, though it gained more ground on Friday, rising 0.33% to $1.0663. Immediate resistance can be seen at 1.0665(5DMA), an upside break can trigger rise towards 1.0733(23.6%fib).On the downside, immediate support is seen at 1.0602(Daily low), a break below could take the pair towards  1.0534(38.2%fib).

GBP/USD:   Sterling rose against the dollar on Friday, after a series of lifelines for struggling banks helped restore some investor confidence, trouncing this week's spring budget as a catalyst for the pound. First Republic Bank   got a $30 billion lifeline from a cohort of large U.S. banks on Thursday. It followed a dramatic day on Wednesday that saw the Swiss National Bank step in to offer Credit Suisse   a $54-billion injection to shore up liquidity and restore investor confidence. Sterling rose 0.12% to $1.2132. Immediate resistance can be seen at 1.2211 (23.6%fib), an upside break can trigger rise towards 1.2245(Higher BB).On the downside, immediate support is seen at 1.2132(5DMA), a break below could take the pair towards 1.2031(38.2%fib).

USD/CAD: The Canadian dollar fell against its U.S. counterpart on Friday as further declines in the shares of Credit Suisse and First Republic Bank rattled markets fearful of contagion and increased concerns that a recession lies ahead because of the impact of tighter monetary policy. Fears of a banking crisis failed to subside even after several major U.S. banks offered a $30 billion lifeline for beleaguered First Republic Bank . The loonie was trading 0.3% lower at 1.2704 to the greenback . It touched its strongest intraday level since April 2018 at 1.2630 before turning lower. Immediate resistance can be seen at 1.3734 (5DMA), an upside break can trigger rise towards 1.3779(23.6%fib).On the downside, immediate support is seen at 1.3681(38.2% fib), a break below could take the pair towards 1.3593(50% fib).

USD/JPY: The dollar declined against yen on Friday as investors fled to save haven yen  as fears of a global banking meltdown continued to plague investors. The collapse of Silicon Valley Bank in the U.S. has highlighted banks' vulnerabilities to sharply higher rates, while a rout in Credit Suisse shares added to market turmoil.The Japanese yen , which   tends to benefit in times of extreme market volatility or stress, rose. It was last up 1.41% at 131.84 per dollar, set for a weekly rise of 1%.Strong resistance can be seen at 132.60(5DMA), an upside break can trigger rise towards 133.94 (38.2% fib).On the downside, immediate support is seen at 131.45(23.6%fib), a break below could take the pair towards 131.00(Psychological level).

Equities Recap

European shares erased their early gains on Friday and logged their steepest weekly drop in five months as supportive measures from regulators across the United States and Europe failed to allay fears over a brewing global banking crisis.

UK's benchmark FTSE 100 closed down  by  1.11 percent, Germany's Dax ended down by 1.33 percent, France’s CAC finished the day down by 1.43 percent.                

Wall Street closed lower on Friday, marking the end of a tumultuous week dominated by an unfolding crisis in the banking sector, with investors now guessing how much the Federal Reserve will hike interest rates next week.

A tumultuous week for stocks ended with all three of Wall Street’s main indexes closing lower, as an unfolding crisis in the banking sector grabbed headlines and spooked investors.

Dow Jones closed up  by  1.19% percent, S&P 500 closed down  by 1.10 % percent, Nasdaq settled down  by 0.74%  percent.

Treasuries Recap

U.S. Treasury yields stumbled on Friday, as investor worries about liquidity shortage in the banking system persisted despite financial rescues for beleaguered lenders Credit Suisse   and First Republic Bank .

In afternoon trading, the yield on 10-year Treasury notes was down 16.8 bps at 3.416%. On the week, the 10-year yield has weakened by 28 bps, the biggest decline since November.U.S. 30-year bond yields fell 10.5 bps to 3.609%.

Commodities Recap

Gold prices surged more than 2% on Friday as a wave of banking crises shook global markets and put bullion on track for its biggest weekly rise in three years, while bets solidified for a less aggressive Federal Reserve in its fight against inflation.

Spot gold climbed 2.8% to $1,971.95 per ounce by 1:47 p.m. ET (1747 GMT), highest since April 2022. Bullion has added about 5.6% this week, the most since March 2020.

Oil prices settled lower Friday, reversing early gains of more than $1 a barrel as banking sector fears caused both benchmarks to reach their biggest weekly declines in months.

Brent crude futures settled down by $1.73, or 2.3%, to $72.97 a barrel. U.S. West Texas Intermediate crude fell $1.61, or 2.4%, at $66.74.

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