Daily FX & Market Commentary

Transcription

Please note and carefully read the
Important Disclosure on the last page
Jan 30 2015
Published from Tuesday to Friday
Market Recap
• The S&P 500 Index rose 1% as earnings
boosted consumer shares and materials
producers.
• Data Thursday also showed the fewest
Americans in almost 15 years filed
applications for unemployment benefits.
• Brent crude futures rebounded 1.4% to
$49.13 a barrel from their biggest one-day
drop in more than week.
Table: Daily Market Movement (Jan 29, 2015)
Equity Market Indices
U.S.
S&P 500 Index
Dow Jones Industrial Average
NASDAQ Composite Index
Europe
Stoxx Europe 600 Index
DAX Index
Japan
TOPIX Index
Nikkei 225 Stock Average
China / Hong Kong
Hang Seng Index
Hang Seng China Enterprises
Shanghai SE Composite
Close Change
2,021.25
17,416.85
4,683.41
+19.1
+225.5
+45.4
368.76
10,737.87
-0.3
+26.9
1,413.58
17,606.22
-16.3
-189.5
24,595.85
11,736.09
-266.0
-227.5
3,262.31
-43.4
% Commodity Futures
Energy & Metals
+1.0% WTI Crude Oil (USD/bbl)
+1.3% Brent Crude (USD/bbl)
+1.0% Natural Gas (USD/MMBtu)
COMEX Gold (USD/oz)
-0.1% LME Copper (USD/MT)
+0.3% Bond Yields & CNY
U.S. Treasuries - Yields
-1.1% 3-Month - Yield (%)
-1.1% 5-Year - Yield (%)
10-Year - Yield (%)
-1.1% 30-Year - Yield (%)
-1.9% USD/CNY
-1.3% China Renminbi Spot
Close
44.53
49.13
2.72
1,254.6
%
+0.2%
+1.4%
-5.1%
-2.4%
5,484.0
0.0%
Close Change
0.01
-0.01
1.27
+0.03
1.75
+0.03
2.31
+0.02
Close
%
6.25
0.0%
Data Source: Bloomberg L.P.
Hot News: Earnings to remain the primary driver for U.S.
stocks
Chart: S&P 500 vs S&P 500 EPS
Source: Haver Analytics and Citi Research, as of Jan 23, 2015
Technology giants reported quarterly earnings
• Google Inc., Visa Inc. and Amazon.com Inc. were
among 52 S&P 500 companies posting results
yesterday.
• Amazon jumped more than 8% in post-market
trading after reporting profit and sales for the holiday
quarter that exceeded analysts’ estimates.
• However, Alibaba Group Holding fell 8.8% after
reporting revenue that missed estimates. Revenue
was 26.2 billion yuan in the third quarter (market
estimate: 27.6 billion-yuan).
Citi analysts’ view:
• Recent volatility in the U.S. market has largely been
oil-related. The non-energy sectors have held up
relatively well with realized volatility in line with
recent annual averages.
• Intra-market correlations in the U.S. remain low
which suggests that broad based equity market risk
aversion is not yet evident.
• Market trends will likely remained to be driven
by earnings and EPS guidance as close
connection exist between earnings and index
performance over time. (Chart)
• Earnings-per-share for the S&P 500 Index may
reach 7.5% this year. Among the 196 companies
that have reported quarterly results so far this
month, 71% beat analysts’ expectations on
earnings, according to Bloomberg.
• Citi analysts remain generally constructive longer
term while advising some nearer-term tactical
caution. For the S&P 500, we maintain the yearend 2015 forecast level of 2,200.
• Risk Factors: Potential negative spillovers to
financials from energy high yield debts, external
shocks from Europe and emerging markets.
© 2015 Citibank
Citibank and Arc Design is a registered service mark of Citibank, N.A. or Citigroup Inc. Citibank (Hong Kong) Limited
1
FX & Commodity Technical Corner
YESTERDAY PERFORMANCE
FX TREND
TECHNICAL
CCY
USD
EUR/USD
USD/JPY
GBP/USD
USD/CAD
AUD/USD
NZD/USD
USD/CHF
USD/SGD
GOLD
Close Price
Day High
Day Low
94.47
1.1320
118.29
1.5067
1.2616
0.7762
0.7266
0.9238
1.3538
1257.38
94.69
1.1368
118.49
1.5162
1.2677
0.7907
0.7348
0.9252
1.3554
1285.99
93.97
1.1262
117.39
1.5019
1.2512
0.7720
0.7234
0.9047
1.3501
1252.05
Short Term
Comment
Bullish
Bearish
Neutral
Neutral
Neutral
Neutral
Neutral
Bullish
Neutral
Bullish
Support
Resistance
90.00
1.1141
115.57
1.4952
1.2000
0.7704
0.7118
0.8813
1.3224
$1,250
95.86
1.1460
120.83
1.5476
1.2766
0.8209
0.7433
0.9607
1.3649
$1,345
Citi Foreign Exchange
Forecast:
0-3
Months
92.54
1.15
116.00
1.53
1.19
0.82
0.77
0.83
1.35
1270
6-12
Months
97.95
1.10
130.00
1.47
1.25
0.72
0.67
0.95
1.37
1240
FX Rate Source: Bloomberg L.P. (cut off time is NY Time 5:00pm)
•
•
•
•
•
USD rebounded: U.S. Jobless Claims plunged from 308K to 265K last week, topped market estimates.
JPY dropped: Japan Core CPI growth (YoY) fell from 2.7% to 2.5% in Dec 2014, trailed market expectations.
CAD fell: Oil prices remained low yesterday, triggering concerns over Canada’s export income.
NZD plunged: The RBNZ turned the monetary policy stance from hawkish to neutral at policy meeting.
CHF weakened against USD and EUR, on renewed speculation of intervention by the Swiss National Bank.
Daily FX Focus
USD/CHF may rise toward 0.9557-0.9607:
0.9557-0.9607 (fibo 0.764, 55MA)
0.8813 (fibo 0.50)
Source: Bloomberg L.P., data as of Jan 30, 2015
CHF Outlook:
• The SNB’s surprise decision to end its CHF 1.20/€
FX cap — and the subsequent sharp appreciation of
the CHF — has probably set the stage for severe
deflation and recession in Switzerland.
• We expect real GDP to fall by about 1% this year
and to again fall slightly in 2016, with CPI of roughly
minus 2.5% this year and deflation in later years.
• This would represent the biggest YoY decline in
prices for any advanced economy over the last 35
years, apart from the steep deflation in HK during
1999-2003.
• In response, we expect the SNB may move its
policy rate into even more deeply negative territory,
with the likelihood of some kind of additional policies
to inhibit capital inflows (perhaps through taxation).
Technical Analysis:
• 1) MACD: Cross-over; 2) RSI: Trending up
• The technical indicators suggest that USD/CHF may rise toward 0.9557-0.9607, with support at 0.8813.
NOTE: The brackets are the exchange rates in terms of Hong Kong dollar, with HKD $7.75 exchange rate for reference, and 1,000 yen per unit for JPY/HKD.
© 2015 Citibank
2
NZD/USD may drop to 0.7118:
Recap:
• NZD dropped yesterday as the RBNZ turned
its monetary policy stance from hawkish to
neutral and said to keep the OCR on hold for
some time.
0.7118 (Mar 2011 low)
0.6540-0.6690
(200 month MA &
Jul 2005 low)
NZD Outlook:
• Because of the global disinflation risk amid
the decline in oil prices, Citi analysts defer its
timing of next rate hike from Dec this year to
Q2 2016.
• However, due to the strong housing market
and the Governor’s expectation of inflation to
back to the mid-point of the target band, the
RBNZ is unlikely to cut the interest rate.
• The divergences in monetary policy
between the Fed and RBNZ may keep NZD
under pressure in medium term.
Technical Analysis:
• NZD/USD has breached long term double top neckline at 0.7371.
• We expect NZD/USD may fall toward 0.7118, with resistance at 0.7494 (28 Jan top).
AUD/NZD may trade inside 1.0579-1.0829
1.0829-1.0863 (fibo
0.50 & 100MA)
1.0579 (fibo 0.236)
Technical Analysis:
• 1) RSI: turning down from overbought region; 2) Being capped
below fibo 0.618 & 100MA
• We expect AUD/NZD may trade inside the range of 1.05791.0829.
Recap:
• AUD/NZD fell sharply yesterday on AUD’s
weakness as market expect the RBA may
cut the interest rate next week with other
central banks already cutting rate.
AUD/NZD Outlook:
• Citi analysts believe a rate cut may be
overreaction on higher-than-expected Q4-14
CPI.
• Recent jobs data suggests the economy has
been robust. There is already stimulus from
lower oil price (equivalent to two rate cuts)
and lending rates already have come down
driven by lower global long term rates.
• A rate cut may would place pressure on
prudential measures to deal with the risk of
rekindling the Sydney and Melbourne
property markets.
• Thus, we believe AUD/NZD’s downside may
be limited and it will likely trade inside the
range.
NOTE: The brackets are the exchange rates in terms of Hong Kong dollar, with HKD $7.75 exchange rate for reference, and 1,000 yen per unit for JPY/HKD.
© 2014 Citibank
3
Important Economic Data (Jan 26, 2014 – Jan 30, 2015)
Time
Importance
Event
Period Actual
Survey
Prior
Monday
01/26/2015 07:50
JN
!
Trade Balance Adjusted
01/26/2015 17:00
GE
!!
IFO Business Climate
Dec -¥712.1B -¥743.1B -¥832.5B
Jan
106.7
106.5
105.5
Dec
2
--
1
Tuesday
01/27/2015 08:30
AU
!
NAB Business Confidence
01/27/2015 17:30
UK
!!
GDP YoY
4Q
2.70%
2.80%
2.60%
01/27/2015 21:30
US
!!
Durable Goods Orders
Dec
-3.40%
0.60%
-2.10%
01/27/2015 22:00
US
!
S&P/CS Composite-20 YoY
Nov
4.31%
4.30%
4.47%
01/27/2015 23:00
US
!!
New Home Sales MoM
Dec
11.60%
2.70%
-6.70%
01/27/2015 23:00
US
!!
Consumer Confidence Index
Jan
102.9
95.5
93.1
01/28/2015 08:30
AU
!!!
CPI YoY
4Q
1.70%
1.80%
2.30%
01/29/2015 03:00
US
!!!
FOMC Rate Decision (Upper Bound)
Jan
0.25%
0.25%
0.25%
01/29/2015 04:00
NZ
!!!
RBNZ Official Cash Rate
Jan
3.50%
3.50%
3.50%
01/29/2015 05:45
NZ
!!
Trade Balance
Dec
-159M
75M
-285M
01/29/2015 21:30
US
!!
Initial Jobless Claims
Jan
265K
300K
308K
01/29/2015 23:00
US
!
Pending Home Sales NSA YoY
Dec
8.50%
10.50%
1.50%
Dec
--
3.50%
3.50%
Wednesday
Thursday
Friday
01/30/2015 07:30
JN
!!
Jobless Rate
01/30/2015 07:30
JN
!!!
Natl CPI Ex Fresh Food YoY
Dec
--
2.60%
2.70%
01/30/2015 18:00
EC
!!
Unemployment Rate
Dec
--
11.50%
11.50%
-0.20%
01/30/2015 18:00
EC
!!!
CPI Estimate YoY
Jan
--
-0.40%
01/30/2015 21:30
CA
!!!
GDP YoY
Nov
--
--
2.30%
01/30/2015 21:30
US
!!!
GDP Annualized QoQ
4Q
--
3.00%
5.00%
01/30/2015 23:00
US
!!
U. of Mich. Sentiment
Jan
--
98.2
98.2
For any enquiries, please call (852) 2860-0333.
Source: Source: Bloomberg L.P.
(K = Thousand, M = Million, B = Billion)
This document is based on information provided by Citigroup Investment Research, Citigroup Global Markets, and Citigroup Global Wealth Management. It is provided for your information only. It is
not intended as an offer or solicitation for the purchase or sale of any security. Information in this document has been prepared without taking account of the objectives, financial situation or needs of
any particular investor. Accordingly, investors should, before acting on the information, consider its appropriateness, having regard to their objectives, financial situation and needs. Any decision to
purchase securities mentioned herein should be made based on a review of your particular circumstances with your financial adviser. Investments referred to in this document are not
recommendations of Citibank (Hong Kong) Limited (“Citibank”) or its affiliates. Although information has been obtained from and is based upon sources that Citibank believes to be reliable, Citi
analysts do not guarantee its accuracy and it may be incomplete and condensed. All opinions, projections and estimates constitute the judgment of the author as of the date of publication and are
subject to change without notice. Prices and availability of financial instruments also are subject to change without notice. Past performance is no guarantee of future results. The document is not to
be construed as a solicitation or recommendation of investment advice. Subject to the nature and contents of the document, the investments described herein are subject to fluctuations in price and/or
value and investors may get back less than originally invested. Certain high-volatility investments can be subject to sudden and large falls in value that could equal the amount invested. Certain
investments contained in the document may have tax implications for private customers whereby levels and basis of taxation may be subject to change. Citibank does not provide tax advice and
investors should seek advice from a tax adviser. Investment products: (i) are not insured by the Federal Deposit Insurance Corporation; (ii) are not deposits or other obligations of any insured
depository institution (including Citibank); and (iii) are subject to investment risks, including the possible loss of the principal amount invested. Citi Foreign Exchange: Forecasts are a joint venture
between Citi’s foreign exchange, global macro and technical strategy groups and our developed and emerging markets economists. Under normal circumstances, we expect to present Forecasts on a
monthly schedule although we may offer intra month updates if circumstances dictate. Technical Trend: All views, opinions and estimates derived from CitiFX Technicals (i) may change without notice
and (ii) may differ from those views;, opinions and estimates held or expressed by Citi or other Citi personnel, including Citi Foreign Exchange: Forecast. Should CitiFX Technicals not cover any major
currency pairs, the indication of short-term technical "bullish", "bearish", or "neutral" trends will be based on the result of analysis with various widely known short-term technical analysis tools, namely
RSI, MACD, fibonacci, stochastics, bollinger bands, and simple moving averages.
4

Daily FX & Market Commentary

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