• Asian equities traded with little in the way of firm direction with macro newsflow particularly light overnight
• USD held onto yesterday’s gains as the USD-index remained above the 99.00 level while AUD underperformed amid downbeat domestic retail sales
• Looking ahead, highlights include US JOLTS, APIs, Fed’s Kaplan and Rosengren

ASIA

Major Asian stock indices traded mostly subdued following an indecisive lead from US where S&P 500 and DJIA closed relatively unchanged, although the Nasdaq 100 posted a fresh record high as Apple surmounted the USD 800bln market cap level. ASX 200 (-0.5%) underperformed following earnings from CBA. Furthermore, all Big 4 banks traded with firm losses ahead of the upcoming budget announcement which Treasurer Morrison signalled would fund the Productivity Commission enquiry into banks’ financial product sales and possible conflicts of interests. Nikkei 225 (-0.1%) was negative on pull-back from yesterday’s surge, while Shanghai Comp (-0.1%) and Hang Seng (+0.4%) were mixed after the PBoC refrained from liquidity injections for the 3rd consecutive day. South Korean markets were shut due to Presidential Elections and 10yr JGBs traded flat following weakness in T-notes, while today’s 10yr JGB auction also failed to support demand with the b/c slightly lower than prior.

PBoC refrained from open market operations today. (Newswires)

PBoC set CNY mid-point at 6.9037 (Prev. 6.8947)

EUROPE/UK

UK BRC Retail Sales Monitor (Apr) Y/Y 5.6% vs. Exp. 0.5% (Prev. -1.0%). (Newswires)

FX

USD held onto yesterday’s gains as the USD-index remained above the 99.00 level. This kept its major counterparts subdued in which EUR/USD and GBP/USD languished near yesterday’s lows, while AUD/USD was the notable underperformer as the pair extended on its descent below the 0.7400 handle following disappointing retail sales figures.

Australian Retail Sales (Mar) M/M -0.1% vs. Exp. 0.3% (Prev. -0.1%). (Newswires)

Australian Retail Sales Ex-Inflation (Q1) Q/Q 0.10% vs. Exp. 0.50% (Prev. 0.90%)

COMMODITIES

WTI traded rangebound amid a lack of tier 1 data, which saw prices hold onto yesterday’s mild rebound following OPEC source comments that producers are mulling extending the output cut deal for 9-months or more, while gold (+0.2%) was subdued near 7-week lows on a firmer greenback, as the USD-index reclaimed the 99.00 level. Elsewhere, copper also saw lacklustre demand alongside the negative risk off tone observed in China.

US

Treasury markets were offered tspanoughout the session, with the recent hawkish Fed rhetoric possibly leading to position taking in the asset class. A slight bounce was seen in the complex, with many techs noting over sold levels alongside long end support in the form of the 50 DMA. The 10y T-note Jun’17 future settled at 124.02, down 5 ticks.