ASIA: ASEAN Manufacturing Sees Stronger Growth, Indonesia Outperforms
The S&P Global ASEAN manufacturing PMI rose further into expansion territory in March at 51.5 from 50.4. The improvement was driven by positive domestic new orders growth which resulted in a pickup in production and employment, but foreign orders contracted. Only the Philippines and Indonesia are in expansionary territory above 50. Most of ASEAN is optimistic looking forward.
- Indonesia’s manufacturing PMI rose to 54.2 from 52.7, the highest since October 2021, but with minimal capacity pressures there was no change in employment. The increase in growth was driven by a sharp rise in domestic new orders and thus in output to its fastest in over two years. Foreign orders contracted though. Costs rose strongly, especially due to the exchange rate, but robust demand enabled them to be passed onto customers with selling prices rising to an almost two year high and at an above average rate.
- The Philippines PMI eased only 0.1 point to 50.9 but production shrank due to input shortages, while orders growth is lacklustre but enough for hiring to rise. Selling price fell even though costs rose but at a lower rate. Confidence in the outlook is weak.
- Manufacturing activity in Thailand continued to shrink but it eased considerably in March with the PMI at 49.1 up from 45.3. The improvement was driven by rising output but orders and employment continue to shrink, although at a slower pace. The outlook was its most positive in almost a year. Cost and price pressures eased.
Source: MNI - Market News/Bloomberg
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USDCAD TECHS: Bulls Remain In The Driver’s Seat
- RES 4: 1.3729 76.4% retracement of the Nov 1 - Dec 27 bear leg
- RES 3: 1.3661 High Nov 27
- RES 2: 1.3623 61.8% retracement of the Nov 1 - Dec 27 bear leg
- RES 1: 1.3606 High Feb 28
- PRICE: 1.3550 @ 16:20 GMT Mar 1
- SUP 1: 1.3441/3359 Low Feb 22 / Low Jan 31 and key S/T support
- SUP 2: 1.3343 Low Jan 12
- SUP 3: 1.3288 Low Jan 5
- SUP 4: 1.3229 Low Feb 1
USDCAD is holding on to its recent gains. The pair traded higher Wednesday, resulting in a print above resistance at 1.3586, the Feb 13 high and bull trigger. A clear break of this level would confirm a resumption of the uptrend and pave the way for a climb towards 1.3623 a Fibonacci retracement. Key support to watch lies at 1.3359, the Jan 31 low. Clearance of this level would be bearish. Initial firm support has been defined at 1.3441, the Feb 22 low.
AUDUSD TECHS: Trend Signals Remain Bearish
- RES 4: 0.6871 High Dec 28 and the bull trigger
- RES 3: 0.6729/71 High Jan 12 / 3
- RES 2: 0.6663 High Jan 16
- RES 1: 0.6595/6625 High Feb 22 / High Jan 30 and key resistance
- PRICE: 0.6533 @ 16:16 GMT Mar 1
- SUP 1: 0.6478/6443 Low Feb 15 / 13 and the bear trigger
- SUP 2: 0.6412 76.4% Fibonacci retracement for Oct - Dec upleg
- SUP 3: 0.6360 Low Nov 14
- SUP 4: 0.6339 Low Nov 10
AUDUSD is trading just above this week’s lows. Recent gains appear to have been a correction and the downtrend that started Dec 28, is intact. The pair has recently attempted to clear resistance around the 50-day EMA, at 0.6567. A clear break of this average is required to suggest scope for a stronger recovery. On the downside, the bear trigger lies at 0.6443, the Feb 13 low. A breach would open 0.6412, a Fibonacci retracement point.
US STOCKS: Chip Stocks Lead S&P Eminis to New Highs
- Stocks remain strong in late afternoon trade, carry-over rally in semiconductor stocks helping S&P Eminis extend new contract highs: S&P E-Minis currently up 40 points (0.78%) at 5144.25, Nasdaq up 180 points (1.1%) at 16272.41, DJIA up 76.22 points (0.2%) at 39071.61.
- Leading Gainers: Information Technology and Energy sectors outperformed Friday, AI demand driving continued broad-based support for chip makers: Broadcom +8.13%, Micron Tech +5.61%, KLA Corp +5%, Advanced Micro Devices +4.93%.
- Energy sector shares were supported by oil and gas shares as crude prices rallied (WTI +1.62 at 79.88): APA +2.72%, Marathon +2.38%, ConocoPhillips +1.88%.
- Laggers: Utilities and Financial sectors underperformed in the first half, multi-energy and electricity shares weighed the former: Dominion Energy -6.19%, Xcel Energy -6.04%, Edison Int -1.93%.
- Insurance names continued to weigh on the Financials sector (more so than banks after NY Comm Bancorp after the bank reported "material weakness" in internal loan review and controls late Thursday): Allstate -2.45%, Hartford -1.40%, Prudential Financial -1.25%.
