NORGES BANK: VIEW: Swedbank No Longer Expect 25bp Norges Cut Next Week
Following the Q1 Regional Network Survey, Swedbank no longer expect Norges Bank to cut rates at next week’s meeting.
- “We expect Norges Bank to condition a first rate cut (potentially in June?) on inflation coming more prominently down again”.
- “The more positive tone of the Regional Network report will take away some of the downside risks to growth in the Norwegian economy, and Norges Bank will likely assess the real economy momentum to be overall quite normal”.
- “As inflation surprised markedly to the upside in February, albeit some if it could prove temporary, Norges Bank will likely revise up their projections for both growth and inflation next week in the upcoming MPR”.
- “The risk scenario is that Norges Bank de facto cuts the policy rate, as the pre-commitment is seen as binding - and inflation as temporary - however, if that is the case, it will likely be a 'hawkish cut', combined with an upward revised rath potentially only signalling one more cut this year”
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COMMODITIES: Gold Holding Onto Bulk of Recent Gains, Bull Cycle Intact
WTI futures have pulled back from last week’s high and price has again traded below the 50-day EMA - at $71.62. Attention is on $70.20 (pierced), the Feb 6 low. A clear break of it would undermine a bullish theme and confirm a breach of the 50-day EMA. This would strengthen a bearish threat and open $67.75, the Dec 20 ‘24 low. Key S/T resistance has been defined at $74.06, the Feb 3 high. A move above this level would reinstate a bull theme. A bull cycle in Gold remains in play and the yellow metal continues to hold on to the bulk of its recent gains. Fresh highs 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 $2833.2, the 20-day EMA.
- WTI Crude up $1.13 or +1.6% at $71.89
- Natural Gas down $0.15 or -3.89% at $3.581
- Gold spot up $15.61 or +0.54% at $2912.21
- Copper down $6.75 or -1.43% at $464.55
- Silver up $0.16 or +0.49% at $32.4995
- Platinum up $2.86 or +0.29% at $987.92
EQUITIES: Bullish Trend Structure in Eurostoxx 50 Futures Remains in Play
The trend condition in Eurostoxx 50 futures remains bullish. The move higher last week confirmed 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 5325.83, the 20-day EMA. S&P E-Minis continue to climb and the contract maintains a firmer tone. Attention is on resistance at 6162.25, the Jan 24 high. Clearance of this level would expose the key resistance at 6178.75, the Dec 6 ‘24 high. A move above this hurdle would resume the primary uptrend.On the downside, initial key support has been defined at 6014.00, the Feb 10 low. A break would highlight a bearish development.
- Japan's NIKKEI closed higher by 96.15 pts or +0.25% at 39270.4 and the TOPIX ended 8.61 pts higher or +0.31% at 2775.51.
- Elsewhere, in China the SHANGHAI closed lower by 31.34 pts or -0.93% at 3324.49 and the HANG SENG ended 360.58 pts higher or +1.59% at 22976.81.
- Across Europe, Germany's DAX trades lower by 72.66 pts or -0.32% at 22726.07, FTSE 100 lower by 8.26 pts or -0.09% at 8759.9, CAC 40 down 24.22 pts or -0.3% at 8164.53 and Euro Stoxx 50 down 11.34 pts or -0.21% at 5508.37.
- Dow Jones mini up 21 pts or +0.05% at 44656, S&P 500 mini up 16.75 pts or +0.27% at 6148.75, NASDAQ mini up 83 pts or +0.37% at 22279.5.
EQUITIES: Estoxx Put Spread seller
SX5E (18/12/26) 5500/5000ps, sold at 175.2 in 10k.
