Mar 28, 2017 - Market Update

Short recap

Asia up on signs of stabilization in US stocks and USD

Europe opening higher

Chinese HNA Group in talks to acquire Forbes

Credit Suisse to make decision on capital increase soon

BoE asked UK banks to take steps their lending activities stay unaffected in case of full Brexit

Dow Chemical-DuPont merger (USD 130 bln) gets a green light from EU on asset sales plan

Westinghouse (Toshiba US) likely to file for bankruptcy today

PE fund Elliot giving the financial hand to a Chinese investors to buy AC Milan

Qatar wealth fund to be present in Silicon Valley

Ericsson under pressure on provisions

Saw some rebound in US stocks but it was weak

In general US stocks seem to be 20% overpriced compared to Europe

Gold – not able to break through, facing the profit taking

Correction can be within the range 1228-1236 despite positive tailwinds

Bunds – saw sharp rejection of 161 level yesterday

As markets may be refocussing more on high-yield space on the back of better macro data from EU

10-yr Trys yield at 2.39%

10-yr Bunds yield at 0.41%

EURUSD

Closed below the high from Dec 8 at 1.0873

200 DMA at 1.0878 and descending trendline kept the bulls

Bit of caution – As Le Pen is still part of presidential race in FR

It is prudent to still take this risk into account

In case of her win, the current rally would be strongly reversed

As the risks would need to be repriced across many asset classes

Betting suggests lower odds to her victory than official polls show

DXY

Got some technical support: from trendlines and 200 DMA

Otherwise can revisit 96 level

Data

US: Consumer Confidence Index – expecting slightly lower but confirming the trend

Fed speakers (GMT):

Yellen (1630)

George (1645)

Kaplan (1700)

Powell (2030)

Should you have any questions feel free to contact me anytime.

Good luck Champs!

Mr Hawk

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