US TSYS: Asia Wrap - Quiet session
May-01 03:29
TYM5 has traded sideways within a range of 112-05 to 112-10+ during the Asia-Pacific session. It last changed hands at 112-07, unchanged from the previous close.
- The US 10-year yield is a little higher, dealing around 4.18%, up from its close around 4.16%.
- The US 2-year yield is a little higher, dealing around 3.62%, up from its close around 3.6027%
- Earlier comments from US President Trump touted pledged tech investment into the US, while also re-iterating calls for lower interest rates.
- NVIDIA CEO Jensen Huang: "We're going to build NVIDIA's technology, the next generation of that, all here in the United States. Without the President's leadership, his policies, his support, and very importantly his strong encouragement -- manufacturing in the United States wouldn't have accelerated to this pace."
- BOJ left rates unchanged and sees downside risk to the economy in FY25 and 26.
- The 10-year Yield, drifts back towards the first target of 4.10%. Through this level we could get another wave of demand. Buyers should return on any bounce back towards 4.30%.
Data/Events : US Initial Jobless Claims, S&P US Man PMI, ISM Man PMI
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GOLD: Gold’s Lustre Shows No Sign of Fading
Apr-01 03:28
- Gold continues to climb, seemingly hitting new highs daily at present.
- Opening the Asian trading day at a new high of US$3,123.57, gold’s relentless climb continues at it hits $3,143.35.
- Some forecasters believed their forecasts of $3,200 may have been aggressive at the beginning of the year, only now to have questions as to whether they need to restate.
- As the world anxiously awaits news of further tariffs, investors flock to gold as a safe haven, driving up the prices.
- The rally in recent days has seen gold’s year to date performance through a 20% gain.
OIL: Crude Holds Onto Monday’s Gain As Risks To Russian Supply Drive Direction
Apr-01 03:17
Oil prices have held onto Monday’s close to 3% gain as market worries regarding US tariffs on Russia and buyers of Russian oil outweigh concerns over the impact on global demand from increased trade protectionism. WTI is up 0.2% to $71.65/bbl after a high of $71.73, still trading below key resistance at $72.91. Brent is 0.2% higher at $74.95 after breaking $75 briefly. The bull trigger is at $76.26. The USD index is slightly lower but off its intraday trough.
- US President Trump has said this week that he believes Putin won’t “go back on his word” and he wants him to make a deal but will introduce “secondary tariffs on Russian oil” if needed. Russia is the world’s third largest producer and India and China have been large buyers of its discounted crude since the full invasion of Ukraine. The actioning of Trump’s threats would impact these countries and global prices significantly.
- The Russia issue along with threats directed at Iran has so far outweighed worries over US reciprocal tariffs to be announced at 3pm ET (8pm BST) on Wednesday. Press secretary Leavitt said that there would be “no exemptions at this time”.
- Oil found some support from the better-than-expected Caixin China manufacturing PMI in March. It rose 0.4 points to 51.2 signalling moderate growth in the sector.
- Later the Fed’s Barkin speaks on policy and the economic outlook. US final March manufacturing PMI, March manufacturing ISM, February JOLTS job openings and March Dallas Fed services print. The ECB’s Lagarde, Lane and Cipollone speak and European March manufacturing PMIs and euro area CPI are released.
JGBS: Bear-Steepener At Lunch After Domestic Data Drop
Apr-01 03:04
At the Tokyo lunch break, JGB futures are holding weaker, -18 compared to the settlement levels.
- Outside of the previously outlined labour market and Tankan survey data, there hasn't been much by way of domestic drivers to flag.
- “Japan's credit market saw a record ¥15.9 trillion of yen note offerings in the fiscal year ended March 31, but issuance declined 4.6% from a year earlier in the fiscal fourth quarter.” (per BBG)
- Cash US tsys are slightly cheaper in today's Asia-Pac session after yesterday's modest gains. Month/quarter-end rebalancing flow tempered Monday morning's risk-off support ahead of Wednesday's US tariff deadline.
- Cash JGBs are flat to 3bps cheaper, with a steepening bias, across benchmarks. The benchmark 10-year yield is 2.1bps higher at 1.511% versus the cycle high of 1.596%.
- Swap rates are little changed. Swap spreads are tighter.
