Market wrap: - Westpac

Analysts at Westpac offered a market wrap.

Key Quotes:

"Global Market Sentiment:

European stocks ground lower throughout the day as USD rebounded, initially against JPY and then more generally. Trump’s aggressive Mexican wall comments (Mexican president cancels planned trip) turned the recent rebounds in MXN as well as periphery currencies and RUB fell despite the Oil Complex rising over 2% on lower OPEC shipping and Trump moving against biofuels. US yields continued to edge higher with a sharper rise in European periphery yields.

Currencies:

USD/JPY +1.25% to 114.70, NZD/USD -0.95% to 0.7230

An earlier interview with Abe’s advisor Honda, suggesting USD/JPY could rise above 120, was touted as a trigger for USD’s shift in tone which pervaded markets. NZD outperformance reversed before AUD (0.7530), EUR (1.0670) and then GBP (1.2530) all moved lower. RUB (60.47) was also hit, reversing recent performance, as USD was bought more broadly in what may be month-end/Chinese New Year repositioning.

Interest rates: US 10yr and Bund yields ground higher (+2bp to 2.54% and 0.48% respectively), but moves in European spreads were more notable (Italy and Portugal 10yr rose +13bps and +14bps and both France and UK also rose +5bps)."