Forex news from the European trading session - 8 March 2021
Headlines:
- Oil turns to losses as early gains fizzle
- BOE's Bailey: Negative rates contingency planning implies nothing about our intentions in that direction
- Eurozone March Sentix investor confidence 5.0 vs 1.4 expected
- SNB total sight deposits w.e. 5 March CHF 703.1 bn vs CHF 704.1 bn prior
- Tech selloff gathers pace, Nasdaq futures down 2%
- Switzerland February unemployment rate 3.6% vs 3.8% expected
- BOJ's Amamiya: BOJ able to control long-term yields because of bond-buying
- Germany reports 5,011 new coronavirus cases, 34 deaths in latest update today
Markets:
- USD leads, NZD lags on the day
- European equities higher; S&P 500 futures down 0.5%
- US 10-year yields up 3.2 bps to 1.598%
- Gold down 0.6% to $1,690
- WTI up 0.4% to $66.35
- Bitcoin up 0.2% to $50,205
The session was engulfed by an extended selloff in tech and a push higher in Treasury yields to start the week, keeping the dollar more bid across the board.
The greenback rose to fresh highs since November last year, with EUR/USD falling further from 1.1910 to 1.1859 and moving towards its 200-day moving average.
This comes as Nasdaq futures slumped heavily, falling by as much as 2% at the lows, before recovering some ground to be down by 1.2% "only" for the time being.
The softer mood resulting from the rotation out of tech was inspired by the continued push higher in Treasury yields as 10-year yields are testing 1.60% again.
European bonds were much calmer, though investors might be waiting on ECB PEPP data later today after last week's report failed to inspire much confidence.
Going back to FX, USD/JPY gradually ascended from 108.45 to 108.64 and is testing the Friday highs just below its 100-month moving average at 108.76.
The antipodeans led losses on the tentative risk mood as AUD/USD fell from 0.7710 to 0.7636 while NZD/USD declined from 0.7160 to 0.7107.
As the dollar firmed, precious metals also lost ground as gold kept below $1,700 and silver declined from $25.50 to $25.10-20 levels currently.
Elsewhere, oil's spike to start the day on the Saudi attack news also fizzled as Brent dropped back under $70 after peaking just above $71 while WTI pared gains briefly in a drop from near $68 to just below $66 before recovering slightly.
As much as the market faded the moves following the non-farm payrolls on Friday, we are looking to revisit that again this week as the bond market narrative stays on track.
