Good morning and happy Friday.
To the scoreboard:
Dow: 24,895.21 +93.85 (+0.38%)
S&P 500: 2,738.62 +11.82 (+0.43%)
AUD/USD: 0.7792 -0.0033 (-0.42%)
ASX200 SPI futures (March contracts): 5,940 (+1)
1. Draghi drives the euro lower: The ECB kept its policy settings on hold overnight and agreed to drop its pledge to increase bond purchases if necessary. But dovish commentary from ECB president Mario Draghi — who reiterated that bond purchases would remain ongoing until the bank sees a pickup in inflation — subsequently drove the euro sharply lower:
2. US stocks fluctuated throughout the day ahead of a scheduled announcement on trade by President Trump, and markets pushed higher into the close as Trump gave a relatively measured speech. He said the US remains open to modifying or removing tariffs for specific countries and appeared open to working constructively with Australia.
3. While the euro selloff was the main move in currencies overnight, it came amid broader strength in the USD with the US dollar index pushing back above 90. That’s weighed on the Aussie which is back below US78 cents. The AUD was little-changed in the wake of Trump’s announcement following another poor session for commodities.
4. Spot iron ore prices have now lost around 8% since March 1 after a sharp plunge overnight, with analysts split on what’s driving the price action. And oil extended the previous day’s falls with another 1% decline, as benchmark crude dipped below $US64 a barrel. Gold was little-changed but copper, zinc and nickel also fell sharply.
5. Bitcoin hits the skids: Prices slumped back towards $US9,000 overnight and all the latest action seems to be coming from Japan. Two Japanese crypto exchanges were suspended overnight, while traders are blaming the latest price fall on a bitcoin selloff initiated by a Japanese lawyer to fund liquidation proceedings for Mt Gox, the bankrupt Japanese crypto exchange.
6. The day ahead: During Asian trade, there’s no key data domestically but China has February inflation data (CPI and PPI). And traders will be awaiting key data from the US tonight, with the release of all-important employment data for February — with the consensus forecast for another strong month with a further 205,000 jobs to be added.
Have a great weekend.