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3 Mar 2014
European open: Risk aversion ramps up after subdued overnight sentiment
FXStreet (London) - We saw some risk off trading over the Asian session, however it was not as pronounced as might have been expected following heightened tensions in the Ukraine and Russia. The real risk aversion has kicked in with the opening of Russian and European markets.
The Nikkei fell sharply, falling to 4,275.61 at its low, however it clawed back its losses to 4,308.12, down just 10 points/0.25 percent.
AUD/JPY whipped around, falling to a low at JPY90.0713 but rebounded sharply to JPY90.6264
In China, February manufacturing PMIs slid to 50.2 from 50.5 compared to consensus expectations of 50.1. The print showed the expected increased firmness compared to the 48.3 flash HSBC number, but still shows a broad weakening trend.
Russian markets opened with a sharp fall after news that the Ukraine had mobilised troops and that Russian President Vladimir Putin had voiced his right to invade the Ukraine following civil unrest as a measure to protect Russian citizens.
The Moscow exchange has fallen sharply since the open, down 11.09 percent so far to 1,127.85.
USD/RUB is trading at RUB36.4595, up 1.11 percent, whipsawing on rumours of Russian central bank buying to support the tumbling rouble.
Final prints of February manufacturing PMIs are due this morning in Europe, with Spain the first up. Expectations are for a decline from 52.2 to 52.0 followed by Italy, France and Germany all facing declines. European Central Bank president Mario Draghi will be speaking before the Committee on Economic and Monetary Affairs of European Parliament. His appearance comes ahead of Thursday’s ECB meeting, which limits the possibility of him announcing anything significant on the monetary policy front.
Expectations are for a slightly weaker UK manufacturing PMI at 56.5, however we may see a surprise to the upside following from strengthened new factory orders in January.
In the US, January personal spending is expected to slow to a percent gain in January, in line with subdued consumer data through January/February. ISM manufacturing is expected to strengthen to 52.0 following last month’s 51.3 print.
The Nikkei fell sharply, falling to 4,275.61 at its low, however it clawed back its losses to 4,308.12, down just 10 points/0.25 percent.
AUD/JPY whipped around, falling to a low at JPY90.0713 but rebounded sharply to JPY90.6264
In China, February manufacturing PMIs slid to 50.2 from 50.5 compared to consensus expectations of 50.1. The print showed the expected increased firmness compared to the 48.3 flash HSBC number, but still shows a broad weakening trend.
Russian markets opened with a sharp fall after news that the Ukraine had mobilised troops and that Russian President Vladimir Putin had voiced his right to invade the Ukraine following civil unrest as a measure to protect Russian citizens.
The Moscow exchange has fallen sharply since the open, down 11.09 percent so far to 1,127.85.
USD/RUB is trading at RUB36.4595, up 1.11 percent, whipsawing on rumours of Russian central bank buying to support the tumbling rouble.
Final prints of February manufacturing PMIs are due this morning in Europe, with Spain the first up. Expectations are for a decline from 52.2 to 52.0 followed by Italy, France and Germany all facing declines. European Central Bank president Mario Draghi will be speaking before the Committee on Economic and Monetary Affairs of European Parliament. His appearance comes ahead of Thursday’s ECB meeting, which limits the possibility of him announcing anything significant on the monetary policy front.
Expectations are for a slightly weaker UK manufacturing PMI at 56.5, however we may see a surprise to the upside following from strengthened new factory orders in January.
In the US, January personal spending is expected to slow to a percent gain in January, in line with subdued consumer data through January/February. ISM manufacturing is expected to strengthen to 52.0 following last month’s 51.3 print.