Treasury Morning Brief - 5 May

Transcription

1. TREASURY MM ORNING BRIEF TREASURY ORNING BRIEF 05 May 2017 Treasury Sales +44 207 648 7786/89 - Reuters BACM Market Report Markets Nonfarm payroll day, all eyes down for U.S jobs data. Expectations are for a move back somewhere close to a 190k change in the payroll, a number more suited to a smooth running Jobs engine than the antifreeze lacking 98k posted last time. Back on track weather permitting, I can see Janet Yellen sporting an afro, backing group in full voice "Don't blame it on the sunshine, Don't blame it on the moonlight, Don't blame it on the good times, Blame it on the boogie" "Ow (Sunshine)". I could be wrong, maybe they won't get that excited but today's numbers are important , labelled these days as 'hard' data, the difference in leaving a door open for a June hike or opening the bifolds and windows, we shall see if the magic music does indeed grove them. Numbers aside European markets are likely to end the week with a pop rather than a bang, Macron set to win convincingly on Sunday but no point in pushing ones luck with the Poll Gods for a third time. Equity markets are on the back foot, Energy stocks to blame with Oil collapsing to a 5 month low during the Asian session. WTI Crude in fairness has made a considerable effort to regain composure this morning, heading back to $46 a barrel. I'm no expert but I can read, on reading about Oil the gist of it would seem to be there is too much of it in relation to requirement, I'm sure there is a quote in there along the lines of demand and supply, though i might have that wrong, as I say I'm no expert. EM Credit The market is a little softer as we complete yet another week. With June hike expectations in the air Core Bond yields are still elevated from the lows at the start of the week. EM Eurobond sovereign paper trades a smidge lower today, no cause for alarm more of an opportunity to add where possible with a better yield to boot. Senegal, Morocco and Kenya three examples where value might be found in the market, South Africa and Turkey paper viewed as having a bigger correction for now. Turkey returned to International markets yesterday with a USD 30 year Bond taking full advantage of the bid for duration paying 5.875% raising $1.75bn. The 2017 target set by the Turkey Treasury has now been achieved having a total of $6.25bn in the market this year already, with a cost of 5.875% for 30 year money who can blame them. Senegal will hit the roadshow road from Monday, 1 week worth of investor meetings before an expected new USD issue of up to 15 years in the making. As mentioned earlier this week Ivory Coast are another likely participant in the coming weeks having already hired some leads. Foreign Exchange The greenback is on the ropes ahead of the Jobs data, 1.10 in EUR/USD still a tough nut to crack EUR/USD support 1.0950 1.0900 resistance 1.0980 1.1000 GBP/USD support 1.2875 1.2830 resistance 1.2965 1.3000 Economic Indicators Area GE EC US US US US US CA CA Data Markit Germany Retail PMI Markit Eurozone Retail PMI Change in Nonfarm Payrolls Unemployment Rate Average Hourly Earnings MoM Average Hourly Earnings YoY Average Weekly Hours All Employees Net Change in Employment Unemployment Rate Date Apr Apr Apr Apr Apr Apr Apr Apr Apr Previous 52.5 49.5 98k 4.5% 0.2% 2.7% 34.3 19.4k 6.7% Expected 190k 4.6% 0.3% 2.7% 34.4 10.0k 6.7% Today's Tipples  Iron ore prices tanked to a 6 month low. 8.6 percent drop this week alone, demand from China, or lack of, taking the blame  EM Currencies could take the brunt of a strong U.S NFP is market sentiment  Nigerian manufacturers applaud the recently created Foreign currency FX window WWW.BACB.CO.UK
2. FX Markets Bond Markets GBP /USD EUR/USD USD/JPY GBP/EUR Close 1.2923 1.0985 112.46 1.1766 Today 1.2935 1.0963 112.25 1.1799 USD/CHF USD/MAD USD/TND USD/LYD USD / TRY USD/NGN USD/ZAR 0.9864 9.8672 2.4541 1.4043 3.5536 316.99 13.66 0.9880 9.8780 2.4487 1.4043 3.5639 314.83 13.6012 Close 48.38 5518.00 1228.16 16.33 1913.00 437.75 15.37 Today 48.67 5518.00 1234.99 16.49 1913.00 439.00 15.38 US 10 Year UK 10 Year GER 10 Year Today 2.35 1.09 0.38 Equity Markets FTSE 100 S&P 500 DOW JONES Euro Stoxx Nikkei Shanghai Comp Close 7248.10 2389.52 20951.47 3627.88 19445.70 3127.37 Today 7254.08 Ldn PM Ldn PM 3617.48 Closed Closed Commodities Brent Crude Copper Gold Silver Aluminium Wheat Sugar This document has been prepared for information purposes only and is issued by British Arab Commercial Bank plc (BACB). It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication only. It does not constitute or form part of and should not be construed as, an offer to sell or issue, or the solicitation of an offer to buy or acquire, securities in any jurisdiction or an inducement to enter into investment activity. No part of this document, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. Any information contained in this document does not take into account any particular investment objectives, or other financial situation which may be relevant to any particular investor to whom this information may be sent. As a result, investors using the information should assess whether it is appropriate in light of their own individual circumstances before acting on it. The information in this document is based on information obtained from sources believed by BACB to be reliable, but BACB does not represent or warrant, nor accepts responsibility, as to its completeness or accuracy. If you are to rely on the information you are strongly recommended to take your own independent advice. The information on which this document is based may change and BACB is under no obligation to update the information. Sources of information obtained from third parties are cited as appropriate. Copyright (c) British Arab Commercial Bank plc 2013, ALL RIGHTS RESERVED. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, or on any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of British Arab Commercial Bank plc. British Arab Commercial Bank plc Registered Office: 8-10 Mansion House Place, London EC4N 8BJ. Registered in England Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and Prudential Regulation Authority - Firm Reference Number 204564 WWW.BACB.CO.UK