PLN: Regional Factors Work Against Zloty
EUR/PLN changes hands at 4.1946, up 113 pips on the session, with the 50-EMA providing a layer of resistance at 4.1986. A break here would open up the 4.20 mark as well as Feb 4 high of 4.2379. Bears look for a retreat through short-term trendline support at 4.1775.
- Consumer confidence in Poland deteriorated, with headline index falling to -15.2 in March from -14.8 prior. Respondents flagged significantly greater concern about the risk posed by the situation in Ukraine to Poland's "independence and sovereignty" and signalled marginally higher inflation expectations.
- A spill-over from Turkey's domestic political turmoil and Russia's refusal to agree to a full 30-day ceasefire in Ukraine have applied pressure to Polish assets.
- Following yesterday's POLGB auction, the Finance Ministry said that it has financed 54% of this year's borrowing needs. POLGB curve has twist steepened at the margin this morning.
- The WIG Index is 0.5% worse off, pulling back from a new all-time high printed yesterday. The WIG20 Index has shed 0.6%.
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EUROPEAN DATA: Larger Than Expected Trade Surplus On Import Weakness
- The Eurozone trade surplus printed close to consensus in December, at a seasonally adjusted E14.6bn (cons E14.5bn) after an upward revised E13.3bn (originally E12.9bn).
- The larger surplus was for the ‘wrong’ reasons, coming as the decline in imports (-0.8% M/M) outstripped that of exports (-0.2% M/M).
- This story was exaggerated for the EU as a whole, with a surplus widening from E10.1bn to E12.9bn (sa) as imports fell -1.2% M/M vs exports 0.1% M/M.
- Turning to the broader EU nsa data, extra-EU export growth stood at 3.7% Y/Y vs 3.9% Y/Y for extra-EU imports, whilst intra-EU trade was more subdued at just 1.6% Y/Y.
- One of the fastest growing areas of exports was for chemicals & related products (14.3% Y/Y), as we’ve noted one of the more vulnerable areas to US tariffs considering its magnitude within EU-US trade.
- By country, trade with the US was mixed the month ahead of Trump’s inauguration, with overall exports rising 5.6% Y/Y vs overall import growth of -10.8% Y/Y.
COMMODITIES: WTI Futures Remain Below 50-Day EMA
WTI futures have pulled back from last week’s high and price has again traded below the 50-day EMA - at $72.08. Attention is on $70.43, the Feb 6 low. It has been pierced, a clear break would undermine a bullish theme and confirm a breach of the 50-day EMA. This would strengthen a bearish threat and open $68.05, the Dec 20 ‘24 low. Key S/T resistance has been defined at $75.18. A move above this level is required to reinstate a bull theme. A bull cycle in Gold remains in play and the yellow metal continues to trade closer to its latest highs. Recent gains once again confirm a resumption of the uptrend and maintain the bullish price sequence of higher highs and higher lows. Moving average studies are in a bull mode position too, highlighting a dominant uptrend. Sights are on the $2962.2, a Fibonacci projection. The first key support to watch is $2826.5, the 20-day EMA.
- WTI Crude up $0.12 or +0.17% at $70.86
- Natural Gas down $0.09 or -2.42% at $3.637
- Gold spot up $20.92 or +0.73% at $2903.75
- Copper down $3.3 or -0.7% at $468
- Silver up $0.35 or +1.08% at $32.4489
- Platinum up $3.97 or +0.4% at $988.13
EQUITIES: Recovery for E-Mini S&P Continues to Undermine Recent Bearish Threat
The trend needle in Eurostoxx 50 futures continues to point north. The move higher last week confirms once again, a resumption of the uptrend that started on Nov 21 ‘24. Moving average studies are in a bull mode set-up too, highlighting a dominant uptrend. A major resistance at 5525.00, the March 2000 all-time high (cont), has been pierced. A clear break of it would highlight a key bullish technical breach. Support to watch is 5304.02, the 20-day EMA. S&P E-Minis traded higher this week and the contract maintains a firmer tone. The latest recovery undermines a recent bearish threat and attention turns to resistance at 6162.25, the Jan 24 high. Clearance of this level would expose key resistance at 6178.75, the Dec 6 ‘24 high. A move above this hurdle would resume the primary uptrend. Initial key support has been defined at 6014.00, the Feb 10 low. A break would be a bearish development.
- Japan's NIKKEI closed higher by 24.82 pts or +0.06% at 39174.25 and the TOPIX ended 7.69 pts higher or +0.28% at 2766.9.
- Elsewhere, in China the SHANGHAI closed higher by 9.106 pts or +0.27% at 3355.83 and the HANG SENG ended 4.1 pts lower or -0.02% at 22616.23.
- Across Europe, Germany's DAX trades higher by 140.04 pts or +0.62% at 22651.69, FTSE 100 higher by 13.62 pts or +0.16% at 8745.81, CAC 40 up 2.32 pts or +0.03% at 8180.86 and Euro Stoxx 50 up 10.47 pts or +0.19% at 5503.87.
- Dow Jones mini up 35 pts or +0.08% at 44670, S&P 500 mini up 8 pts or +0.13% at 6140, NASDAQ mini up 34 pts or +0.15% at 22231.
