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CROSS ASSET: Risk Appetite Up Tariff Headlines, USD Index Near Pre NFP Levels

CROSS ASSET
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The risk mood is supportive in early Tuesday dealings, albeit away from best levels for some markets. The catalyst is an earlier BBG story that hit near the NY/Asia cross over around a potential for a gradual tariff hike plan being considered/studied by Trump's economic advisors (see this link). The plan has reportedly not been presented to incoming President Trump yet, but it is showing the sensitivity of markets to tariff related headlines. 

  • US equity futures have opened up firmer, after a mixed cash session in Monday US trade. Eminis are around 0.30/35% higher, while Nasdaq futures are up by over 0.50%.
  • In the FX space, the USD BBDXY index opened up 0.40% weaker, but the index is up from lows, last near 1315.3. This puts us back close to pre US NFP levels from last Friday. Gains are fairly uniform against the USD, although higher beta plays are outperforming at the margin. NZD/USD is up 0.40% to 0.5605/10, while AUD/USD is up 0.30%, last near 0.6195. GBP and EUR are up 0.20-0.25%, while yen has gained less than 0.10%.
  • USD/CNH is back under 7.3400, up around 0.10% in CNH terms. MXN is 0.20% firmer, with USD/MXN, back near 20.61, with both pairs up from earlier lows.  
  • US Tsys futures have opened firmer, with long-end contracts outperforming, the 10yr contract is +07 at 107-14+. Cash trading will return shortly, after being closed in Asia on Monday, the 10yr briefly topped 4.80% overnight following a fresh wave of selling in SOFR futures, the 10yr is on track to open around 4.75%.
  • Oil is close to unchanged for WTI, while Gold is up a touch, last near $2669. 
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The risk mood is supportive in early Tuesday dealings, albeit away from best levels for some markets. The catalyst is an earlier BBG story that hit near the NY/Asia cross over around a potential for a gradual tariff hike plan being considered/studied by Trump's economic advisors (see this link). The plan has reportedly not been presented to incoming President Trump yet, but it is showing the sensitivity of markets to tariff related headlines. 

  • US equity futures have opened up firmer, after a mixed cash session in Monday US trade. Eminis are around 0.30/35% higher, while Nasdaq futures are up by over 0.50%.
  • In the FX space, the USD BBDXY index opened up 0.40% weaker, but the index is up from lows, last near 1315.3. This puts us back close to pre US NFP levels from last Friday. Gains are fairly uniform against the USD, although higher beta plays are outperforming at the margin. NZD/USD is up 0.40% to 0.5605/10, while AUD/USD is up 0.30%, last near 0.6195. GBP and EUR are up 0.20-0.25%, while yen has gained less than 0.10%.
  • USD/CNH is back under 7.3400, up around 0.10% in CNH terms. MXN is 0.20% firmer, with USD/MXN, back near 20.61, with both pairs up from earlier lows.  
  • US Tsys futures have opened firmer, with long-end contracts outperforming, the 10yr contract is +07 at 107-14+. Cash trading will return shortly, after being closed in Asia on Monday, the 10yr briefly topped 4.80% overnight following a fresh wave of selling in SOFR futures, the 10yr is on track to open around 4.75%.
  • Oil is close to unchanged for WTI, while Gold is up a touch, last near $2669.