Morning Report

Morning Report PDF (PDF 268KB)

Key themes:

• Markets remained jittery overnight amid broadly risk-negative headlines coming out of the Middle East, including reports of changes to the Iranian negotiation team, anti-aircraft systems being activated in Iran, while US President Trump ordered the US Navy to shoot any boat laying mines in the Strait.
• Crude oil prices continued to rally against this backdrop, with Brent breaching the US$106/bbl mark once again. Stocks were broadly sold-off, and yields rose as markets grew more confident in the prospect of a prolonged Fed pause and RBA rate hikes.
• The USD was broadly bid, and while this saw the AUD fall -0.4%, the NZD fell -0.9%, meaning the AUD/NZD is close to retesting the April's highs around 1.22.
• Preliminary PMI readings for April across the globe generally pointed to varying degrees of resilience in current economic activity amid intense uncertainty and growing pessimism over the outlook.