Turnaround Tuesday? - This morning's..........>

FOREX: Turnaround Tuesday?

- This morning's recovery in equities and sentiment looks like a typical dead

cat bounce, with position squaring, short-covering and fatigue helping some

indices stabilise. As such, core European indices sit higher by 2-3%, but the

bounce back in Italian assets is more limited, with news of a now national

lockdown keeping any optimism anchored. Implied vols are also creeping lower,

with short-end JPY, EUR and RUB vols the largest decliners.

- This has translated into weaker safe havens so far, with JPY the poorest

performer in G10 FX, extending USD/JPY's recovery from just above Y101 yesterday

to just shy of Y105 today. Furtively higher oil markets have also helped put a

near-term floor in the likes of CAD and NOK, which outperform slightly today,

but are yet to repair the considerable damage suffered on Monday.

- There are no notable data releases today, keeping focus on a meeting between

President Trump and Treasury Secretary Mnuchin, where they are expected to

outline the details of the US stimulus package to combat the Coronavirus.