20 March 2017. Daily Market Updates

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Headlines – International
Finance chiefs of the Group of 20 nations renewed their pledge to finalize an overhaul of global bank-capital rules. In the statement capping a two-day meeting in the German town of Baden-Baden, the G-20 urged the Basel Committee on Banking Supervision to finalize the Basel III reforms “without further significantly increasing overall capital requirements,” sticking to previous language. European regulators have been waiting months for President Donald Trump to install new faces at the four institutions that represent the U.S. on the Basel Committee, led by the Federal Reserve. Germany wants to ink a deal on new measures to stop banks gaming capital rules during its presidency of the G-20, whose focal point is a summit in July. But no breakthrough is possible until the U.S. negotiating team is formed.
G-20 drops anti-protectionist pledge as price of U.S. assent.Group of 20 nations said in a communique on Saturday that they are “working to strengthen the contribution of trade to our economies.” While the U.S. didn’t get all it wanted — such as a explicit pledge to ensure trade is fair — that’s a much pared-down formulation compared with the group’s statement last year, and omits a promise to “avoid all forms of protectionism.”
In two days of meetings in the German town of Baden-Baden,the argument by U.S. Treasury Secretary Steven Mnuchin reflects claims by President Donald Trump that his nation has had a bad deal from the current global trade setup.
That attitude pitched him against most other delegates, who favored a multilateral, rules-based system as embodied in the World Trade Organization.While delegates thought he didn’t elaborate on how the U.S. considers itself to be treated unfairly and it wasn’t possible to reconcile his stance and that of the other members in any substantive way. Officials may continue to seek greater consensus on trade between now and the G-20 leaders summit in Hamburg in July.
Donald Trump is forcing the European Union and China to decide how willing they are to set aside trade tensions that go back decades.As the U.S. president pushes his mantra of America First,German ChancellorAngela Merkel and Chinese President Xi Jinping are taking almost every opportunity to affirm their commitment to free trade. Just last week, they agreed on a phone call to continue their trusting cooperation on open markets.
As the U.S. president pushes his mantra of “America First,” German Chancellor Angela Merkel and Chinese President Xi Jinping are taking almost every opportunity to affirm their commitment to free trade. Just last week, they agreed on a phone call “to continue their trusting cooperation” on open markets.
The chiming signals by Europe and China come as Xi plans a visit to Berlin this year and the U.S. sends mixed messages on its future trade policy.
Scotland First Minister Nicola Sturgeon said 2021 Scots independence vote is unacceptable and accused U.K. Prime Minister Theresa May of being intransigent on the timing of a referendum on Scottish independence, and said it would “not be reasonable” to make Scots wait more than three years from now for a potential vote.For her, a fair compromise would be to set a vote “a bit after” after her own deadline of early 2019, when the U.K. could leave the bloc.
Sturgeon’s team want to press on with the legal process after she called for a vote as early as the fall of 2018.
China home-price rises regain speed last month in more cities despite increased restrictions on property transactions by local authorities.New home prices, excluding subsidized housing, gained in February in 56 out of 70 cities tracked by the government, compared with 45 in January, the National Bureau of Statistics said Saturday. Prices climbed in 67 out of 70 cities from a year earlier, compared with 66 in January.To cool the market, Beijing city on Friday raised down-payment requirements for second homes 10 percentage points to between 60 percent and 80 percent. The rule also applied to buyers who don’t currently own a home but previously had a mortgage with the same down-payment threshold, making it harder for someone to sell their house to upgrade to a bigger or more expensive property.
Market in Details
FX:
The Bloomberg Dollar Spot Index slipped 0.1 percent, pushing its rout in the week to 1.3 percent, most since July 2016 after a measure of U.S. inflation expectations dropped to a record low.
EUR/USD fell 0.3 percent versus the dollar to $1.0737
AUD/USD regains above 0.7700, still strong after U.S. Fed meeting.
The yen traded at 112.70 per dollar as of 7:25 a.m. in Tokyo,which comes on the back of its strongest week since the start of February.
Rates:
The yield on 10-year U.S. Treasuries fell four basis points to 2.4987 percent.
French yields for bonds of the same duration climbed two basis points to 1.109 percent, while German bunds fell one basis point to 0.43 percent.
The yield on 10-year Australian government bonds dropped three basis points to 2.83 percent.
Equites:
U.S. stocks slid last Friday as a drop in financials offset gains in utilities as bonds advanced for a third time this week. S&P 500 lost 0.1% to 2,378 while the Dow Industrials lost 20 to 20,914,which ended last week 0.2% higher after the Federal Reserve raised rates without altering its forecast for further increases this year.Utility shares rose 0.7% for biggest gain in S&P 500 as the 10-year Treasury yield dropped 4 basis points.Financial stocks retreated 1.1%.
European stocks advanced to the highest level since December 2015, posting a weekly gain that was supported by the Federal Reserve raising interest rates and investor relief over the result of Dutch elections.At close last week,Stoxx 600 up less than one point at 378.3;Dax up 0.1% at 12,095.24;FTSE 100 up 0.1% at 7,424.96;Stoxx Banks SX7P down 0.6% at 178.79.
The S&P/ASX 200 Index futures contract falls 0.2% at close last week.
The MSCI Emerging Markets Index rose 0.3 percent, bringing its rally for the week to 4.3 percent, outpacing a 1.3 percent advance for the MSCI All-Country World Index
Commodities:
West Texas Intermediate gained less than 0.1 percent to settle at $48.78 a barrel and Brent was little changed at $51.76.
Gold posted its first weekly advance this month.
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