CURRENCY MARKET WRAP
As of Wed, Apr 10, Singapore Time zone UTC +8
Dollar Index -0.05%, $97.00
USDJPY, -0.35%, $111.08
EURUSD, +0.04%, $1.1265
GBPUSD, -0.07%, $1.3054
USDCAD, +0.11%, $1.3329
AUDUSD, +0.02%, $0.7128
NZDUSD, +0.16%, $0.6751
U.S. Treasuries saw increased buying interest following the IMF growth cut for 2019. The 2-yr yield and the 10-yr yield decreased two basis points each to 2.34% and 2.50%, respectively. The U.S. Dollar Index finished flat at 97.00. WTI crude lost 0.5% to $64.06/bbl.
The market received some dampening news pertaining to trade and growth: (1) The White House proposed tariffs on $11 billion of EU products in response to the subsidies the EU provides Airbus and (2) the International Monetary Fund (IMF) lowered its world growth forecast for 2019 to 3.3% from the 3.5% growth it forecast in January..
In Brexit, MPs backed Theresa May’s plan to ask for a Brexit extension until 30 June 2019. May was forced to bring her proposal to the Commons for a vote by the passage of legislation put forward by Labour’s Yvette Cooper and others. The Commons backed the prime minister by a majority of 310. But the president of the EU Council, Donald Tusk, urged EU leaders to offer a much longer extension. Tusk said the UK should be given up to a year to get Brexit sorted, claiming there was little chance of arrangements being made by 30 June. A draft EU Council document suggested such proposals were being drawn up. Labour has said it will back any “reasonable” delay beyond 30 June.
STOCK MARKET WRAP
S&P500, -0.61%, 2,878.20
Nasdaq, -0.41%, 7,568.49
Nikkei Futures, -0.14%, 21,740.0
The S&P 500 lost 0.61% on Tuesday, as negative macroeconomic headlines and a bit of corporate news fostered some broad-based profit taking. Tuesday’s decline snapped an eight-session winning streak for the benchmark index.
Bank stocks were particularly weak after Bank of America (BAC 28.89, -0.28, -1.0%) announced it will increase its minimum wage to $17 per hour on May 1, followed by incremental increases to $20 per hour by 2021. The wage increase raised some concerns about other banks feeling pressured to do the same and its subsequent impact on their profit-margins. The SPDR S&P Bank ETF (KBE 43.13, -0.75) lost 1.7%. American Airlines (AAL 33.31, -0.57, -1.7%) and Pentair (PNR 39.13, -6.13, -13.5%), meanwhile, both lowered their first quarter expectations with Pentair also slashing its fiscal 2019 outlook. AAL finished well off its session low (-3.8%), though, as the company only reduced the top end of its unit revenue growth forecast to 1.0% from 2.0%.