Kuwait Finance House: Market Commentary - 28 May

Transcription

1. Thu , 28 May 2020 Report produced on Thu, 28-May-2020
2. Forex Market JAPANESE YEN 20D SMA 1 .17 1.15 1.13 1.11 1.09 1.07 50D SMA 27-May 20-May 13-May 6-May 29-Apr 22-Apr 15-Apr 8-Apr 1-Apr 25-Mar 18-Mar 11-Mar 4-Mar 1.05 26-Feb 3M %chg 107.71 0.46% -1.71% USD/JPY, JPY crosses buoyant, Tokyo risk-on despite HK - Reuters 28-May-2020 07:22:08 AM * USD/JPY, JPY crosses buoyant, Tokyo risk on, USD/JPY 107.71-91 EBS * USD/JPY gravitates towards massive, USD1.8 bln 107.90 option expiries * Nikkei +2% on day @21,849, risk-on despite US-China tiff on Hong Kong * US Treasury yields firm, 10s @0.693% though still essentially range-bound * EUR/JPY breaks above Ichi cloud, 100-DMA, 118.66 to 118.95 EBS * Another false break above Ichi cloud March 25-27, 119.28 200-DMA eyed * AUD/JPY buoyant, 71.20-51, holding under 72.12 200-DMA, RBA supportive 50D SMA EURO 20D SMA 1M %chg 27-May 20-May 13-May 6-May 29-Apr 22-Apr 15-Apr 8-Apr 1-Apr 25-Mar 18-Mar 11-Mar 4-Mar 26-Feb 113.00 112.00 111.00 110.00 109.00 108.00 107.00 106.00 105.00 104.00 103.00 102.00 101.00 CLOSE CLOSE 1M %chg 3M %chg 1.1003 1.62% 0.05% EUR/USD-Eases after making fresh 2-month high - Reuters News 28-May-2020 07:50:27 AM * EUR/USD opened 0.24$ higher at 1.1008 after whippy US session * Asia was risk-on early as S&P futures moved over 0.4% higher * EUR/USD traded to fresh 2-month high at 1.1035 as EUR/JPY buying underpinned * Asian equities gave back some ground and the EUR/USD settled around 1.1010 * It is trading around the 200-day MA @ 1.1011 & close above would be bullish * A close above 1.1030 targets the March 27 high at 1.1148 * Support at the 10-day MA @ 1.0940 and close below would suggest top in place
3. Forex Market POUND STERLING 1 .32 1.27 1.22 1.17 20D SMA 27-May 20-May 13-May 6-May 29-Apr 22-Apr 15-Apr 8-Apr 1-Apr 25-Mar 18-Mar 11-Mar 4-Mar 26-Feb 1.12 8.20 7.70 7.20 6.70 6.20 50D SMA 27-May 20-May 13-May 6-May 29-Apr 22-Apr 15-Apr 8-Apr 1-Apr 25-Mar 18-Mar 11-Mar 4-Mar 5.70 26-Feb 1M %chg 3M %chg 1.2250 -1.43% -4.92% GBP/USD-Tight but busy range - USD calls the shots - Reuters 28-May-2020 08:07:12 AM * A touch softer, at the base of a busy 1.2260-1.2276 Asian range * Charts; momentum studies flat line, 5, 10 & 21 DMAs conflict, neutral setup * 1.2359, 50% of the April-May fall capped this week - pivotal resistance * 1.2185, 61.8% of the May bounce and 1.2143, 76.4% initial supports UK PM Johnson to go to Brussels next month for Brexit talks - The Times - Reuters May 28 (Reuters) - British Prime Minister Boris Johnson will resume Brexit talks in Brussels next month, the Times newspaper reported on Thursday.Britain's negotiator with the European Union, David Frost, said Johnson will meet the presidents of the European Commission and Council to formally assess the state of the talks, according to the newspaper. 50D SMA TURKISH LIRA 20D SMA CLOSE CLOSE 1M %chg 3M %chg 6.7699 -3.05% 9.09% Turkey's lira must hold this level to sustain its rise - Reuters 27-May-2020 11:25:55 AM * Scope for Turkey's lira to rally 4% to base of daily cloud * USD/TRY now 6.78. Daily cloud base is 6.5050 * 6.5061 is a 61.8% retracement of USD/TRY rise since Mar 3 2020 * To do this USD/TRY must now hold below cloud peak and 55-DMA * 55-DMA 6.7845, peak 6.7644. Yesterday pair closed 6.7380 * Situation balanced. Stocks/risk support further lira rise * China/HK, chance trade war and weak yuan undermine EMFX like TRY * Q1 GDP due later this week is next Turkish event risk May 29
4. US Treasury & Dollar Index 10Y US-TREASURY 2.5 2 1.5 1 1M %chg 3M %chg 0.69 3.52% -47.88% Gold prices edge up as Hong Kong dispute riles China-U.S. ties - Reuters News May 28 (Reuters) - Gold edged up on Thursday after hitting a two-week low in the previous session as the rift between Washington and Beijing over Hong Kong escalated, with prices also supported by central bank and government largesse to cushion the blow from the pandemic. Spot gold XAU= was up 0.2% at $1,712.39 per ounce, as of 0315 GMT, after dropping to $1,693.22 on Wednesday. U.S. gold futures GCcv1 were flat at $1,711.40. Reflecting investor sentiment, SPDR Gold Trust GLD holdings, the world's largest gold-backed exchange-traded fund, rose 0.2% to 1,119.05 tonnes on Wednesday. Palladium XPD= rose 0.4% to $1,943.34 per ounce and platinum XPT= gained 1.4% to $830.21, while silver XAG= inched down 0.1% to $17.29. 0.5 0 GOLD 1800 1750 1700 1650 1600 1550 1500 1450 1400 TODAY'S KEY ECONOMIC INDICATOR RELEASES INDICATOR DOLLAR INDEX 20D SMA 50D SMA 27-May 20-May 13-May 6-May 29-Apr 22-Apr 15-Apr 8-Apr 1-Apr 25-Mar 18-Mar 11-Mar 4-Mar 104.00 103.00 102.00 101.00 100.00 99.00 98.00 97.00 96.00 95.00 94.00 26-Feb CLOSE Ctry / Regn Time For Prior GfK Consumer Confidence* GB 28-May 03:01 Consensus May -34 CPI, Overall Tokyo JP 28-May 03:30 May 0.2 Jobs/Applicants Ratio* JP 28-May 03:30 Apr 1.39 Business Climate* EU 28-May 13:00 May -1.81 Cons Infl Expec EU 28-May 13:00 May 29.1 Consumer Confid. Final EU 28-May 13:00 May -18.8 -18.8 Economic Sentiment EU 28-May 13:00 May 67.0 70.3 Selling Price Expec EU 28-May 13:00 May -7.9 Services Sentiment EU 28-May 13:00 May -35 Corporate Profits Prelim US 28-May 16:30 Q1 2.1 Core PCE Prices Prelim US 28-May 16:30 Q1 1.8 -34 1.33 -28.6 1.8
5. Daily Market Report KWD - CBK FIX CENTRAL BANK OF KUWAIT 0 .3105 KWD (CBK FIX) CLOSE 3M% CHG 0.3095 0.30860 1.00% 0.3085 0.3075 0.3065 0.3055 0.3045 0.3035 0.3025 4-Jul-19 23-Aug-19 12-Oct-19 1-Dec-19 20-Jan-20 10-Mar-20 29-Apr-20 18-Jun-20 MARKET SUMMARY POLICY RATES INDICATOR ON Repo Rate As of 16-Mar-'20 Value 1.00 Prior 2.00 Change -1.00 1W Repo Rate 16-Mar-'20 1.25 2.25 -1.00 1M Repo Rate 16-Mar-'20 1.75 2.75 -1.00 KWD ON Rate 16-Mar-'20 10.00 10.00 0.00 16-Mar-'20 1.50 2.50 -1.00 INSTRUMENT OPEN HIGH LOW CLOSE %CHG 1D Discount Rate EUR 1.0982 1.103 1.0932 1.1003 0.21% LIBOR RATES GBP 1.233 1.2353 1.2203 1.225 -0.66% Tenor Value Tenor JPY 107.52 107.94 107.35 107.71 0.18% ON 0.06 3M Value 0.37 TRY 6.725 6.7819 6.7155 6.7699 0.68% SW 0.09 6M 0.57 Dollar Idx 99.016 99.342 98.716 99.062 0.16% 1M 0.17 1Y 0.68 Brent 35.93 36.16 33.98 34.74 -3.95% 2M 0.29 WTC - - - 32.8 -5.48% Gold 1711.6544 1715.3907 1693.2231 1708.8744 -0.14% OTHER C-BANK RATES 4972.81 5035.77 4972.81 5020.4 2.17% INDICATOR KWSE Index KIBOR RATES Tenor Value Tenor Value Value Prior Change FED Target Rate As of 15-Mar-'20 0.25 0.25 0.00 ECB Refinancing Rate 10-Mar-'16 0.00 0.05 -0.05 ON 1.00 3M 1.75 BOE Bank Rate 19-Mar-'20 0.10 0.25 -0.15 SW 1.25 6M 1.94 BOJ Prime Rate 08-May-'20 1.05 1.10 -0.05 1M 1.50 1Y 2.19 TRY ON Lending Rate 21-May-'20 9.75 10.25 -0.50
6. Global Top News KEY INTERNATIONAL STORIES Trump to sign executive order on social media on Thursday -White House - Reuters News RPT-EXCLUSIVE-India may need to pump $20 bln into coronavirus-hit state banks -sources Reuters News WASHINGTON, May 27 (Reuters) - U.S. President Donald Trump will sign an executive order on social media companies on Thursday, White House officials said after Trump threatened to shut down websites he accused of stifling conservative voices. The officials gave no further details. "Republicans feel that Social Media Platforms totally silence conservatives voices. We will strongly regulate, or close them down, before we can ever allow this to happen," Trump said in a pair of additional posts on Twitter on Wednesday. MUMBAI/NEW DELHI, May 27 (Reuters) - India may need to inject up to 1.5 trillion rupees ($19.81 billion) into its state-owned lenders as their pile of soured assets is expected to double during the coronavirus pandemic, three government and banking sources told Reuters. The government initially considered a budget of around 250 billion rupees for bank recapitalisations but that has risen significantly, a senior government source with direct knowledge of the matter said, with loan defaults likely to rise as businesses take a severe hit from nationwide lockdowns to tackle the coronavirus. U.S. to end sanctions waivers allowing some work at Iran nuclear sites - Reuters *TOP NEWS* Middle East & North Africa - Reuters News WASHINGTON, May 27 (Reuters) - The United States said on Wednesday it will terminate sanctions waivers that had allowed Russian, Chinese and European companies to carry out work originally designed to make it harder for Iranian nuclear sites to be used for weapons development. The waivers, which officials said expire on July 27, covered the conversion of Iran's Arak heavy water research reactor. Pompeo said Washington would extend for 90 days a waiver allowing foreign work at a Russian-built nuclear power plant at Bushehr to ensure safety. * U.S. to end sanctions waivers allowing some work at Iran nuclear sites * Putin, Saudi crown prince agree further coordination on oil output cuts -Kremlin * Oil drops as surprise U.S. stock build douses demand recovery hopes * Fourth Iranian fuel tanker enters the Caribbean as Venezuela readies distribution * Turkish Airlines may delay delivery of Airbus, Boeing planes -report * Lebanon central bank to allocate dollars for raw materials * MIDEAST STOCKS-UAE bourses end higher; other major markets closed for holiday "Move on" says British PM, as row over adviser Cummings persists - Reuters Brazil loses over 1 million jobs in two months as coronavirus sweeps country - Reuters LONDON, May 27 (Reuters) - Prime Minister Boris Johnson urged Britain on Wednesday to move on from what he described as a "very, very frustrating episode" when his closest adviser provoked outrage for taking a long-distance drive during the coronavirus lockdown. Dominic Cummings has refused to quit after it was revealed that he had travelled 400 km (250 miles) from London to northern England in March with his four-year-old son and his wife, who was sick at the time, to be close to relatives. Johnson has repeatedly backed his adviser. BRASILIA, May 27 (Reuters) - Brazil lost over 1 million jobs in March and April, figures on Wednesday showed, wiping out job growth in the first two months of the year and a clear indication of the economic and social damage likely to be unleashed by the coronavirus crisis. The first release of 2020 data, known locally by the acronym 'CAGED', included 860,503 job losses in April, the biggest monthly fall in employment since comparable records began. The release of the data on Wednesday comes after the ministry had said in March that publication was halted because companies were having difficulties providing accurate and up-to-date information. 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