US: Senate Passes Funding Measure To End DHS Shutdown, Heads To House Of Reps

A bull cycle in WTI futures remains intact and the contract is holding on to the bulk of its recent gains. Price has traded through $65.99, the Jan 29 high and bull trigger. The clear break of this level confirms a resumption of the uptrend and opens $68.11, the Jun 23 ‘25 high and the next key resistance. A pullback would - for now - be considered corrective. Support to watch lies at the 50-day EMA, at $61.76. Gold has traded to a fresh short-term cycle high this week marking a continued retracement of the Jan 29 - Feb 2 sell-off. The next resistance to monitor is $5314.0, a Fibonacci retracement level. Note that the reversal from the Jan 29 high continues to highlight a potential top in the L/T trend and from a S/T perspective, an unwinding of the overbought condition. A resumption of bearish activity would refocus attention on $4403.0, the Feb 2 low.

• WTI Crude up $0.02 or +0.03% at $65.63
• Natural Gas down $0.02 or -0.58% at $2.898
• Gold spot up $41.13 or +0.8% at $5185.05
• Copper up $3.9 or +0.65% at $602.8
• Silver up $3.63 or +4.16% at $90.8
• Platinum up $122.16 or +5.62% at $2297.05

The primary trend condition in EuroStoxx 50 futures is unchanged, it remains bullish and a fresh cycle high on Monday reinforces the bull theme and confirms a continuation of the uptrend. The contract has cleared the 6100.00 handle and this paves the way for a move towards 6172.00 next, a Fibonacci projection point. Key support to watch lies at the 50-day EMA, at 5950.08. Clearance of this average would highlight a short-term top. S&P E-Minis continue to trade inside a range. A bear threat is still present following the sharp sell-off on Feb 12. Key resistance at 7043.00, the Jan 28 high, is intact and attention is on 6751.50, the Feb 6 low, where a break would highlight a stronger reversal. This would open 6691.56, 76.4% of the Nov 21 - Jan 28 bull leg. Initial resistance to watch is 6912.20 (pierced), the 50-day EMA. A clear break of it would be a short-term bullish development. 

• Japan's NIKKEI closed higher by 1262.03 pts or +2.2% at 58583.12 and the TOPIX ended 27.18 pts higher or +0.71% at 3843.16.
• Elsewhere, in China the SHANGHAI closed higher by 29.821 pts or +0.72% at 4147.23 and the HANG SENG ended 175.4 pts higher or +0.66% at 26765.72.
• Across Europe, Germany's DAX trades higher by 71.54 pts or +0.29% at 25057.36, FTSE 100 higher by 92.79 pts or +0.87% at 10773.32, CAC 40 up 26.67 pts or +0.31% at 8545.76 and Euro Stoxx 50 up 35.16 pts or +0.57% at 6151.53.
• Dow Jones mini up 70 pts or +0.14% at 49305, S&P 500 mini up 11.5 pts or +0.17% at 6915.25, NASDAQ mini up 54.5 pts or +0.22% at 25083.

10-Year BTP/Bunds briefly trades sub-60bp, aided by the uptick in European equities earlier this morning.

• BTP bulls have been unable to force a meaningful, prolonged break below the level (January closing lows located at 59.45bp).
• While spread widening instances surrounding upticks in broader market volatility and macro risks have been limited, underscoring ongoing demand for carry (aided by the ECB’s monetary policy outlook and fiscal loosening in Germany), it would seem that the market has reached a stage whereby it needs a fresh BTP-bullish catalyst for further tightening to take hold.
• Italian fiscal and sovereign credit matters remain on a positive trajectory. S&P moved Italy to Positive Outlook earlier this month (alongside affirming at BBB+), with the next major Italian ratings decisions are Fitch (March 13) and Moody's (March 27).
• Elsewhere, the domestic political situation has been relatively stable in recent years, lowering the bar to spread tightening when wider conditions are conducive to such a move.
• Most are relatively sanguine about the Italian constitutional referendum that will take place in March.
• In one such example, UBS maintain their long 30-Year BTP vs. Buxl recommendation, targeting a move to 70bp. They note that “clients have asked about the risk of Italian underperformance in case the government does not obtain a majority in the constitutional referendum. This referendum is on the separation of the careers of judges and public prosecutors. It is not easy to gauge turnout for this referendum, but we do not think that an unchanged outcome would weigh on the arguments we have been making in favour of tighter spreads”.