Daily Market Review - 04/04/2014

GOLD

GOLD has been under heavy selling pressure in recent weeks as upbeat U.S. economic data underlined expectations that the Federal Reserve will begin to raise rates sooner than previously thought.

As always, Good numbers are bad numbers when it comes to gold. A surprise up in the report will send the Gold another leg down while a disappointing report is expecting to support its current price.

U.S March Jobs Report

The U.S Labor department will release its March Nonfarm Payrolls at 13:30GMT. This release is expected to provide crucial indications on the strength of the economy and the future course of monetary policy.

This report will also be used as a major test to the argument that the economic weakness in January and February was due to bad weather and the recovery is still on track.

Median forecasts are for a rise of 200,000 in payrolls, though market sentiment hint that expectations are higher and looking towards the 220,000 mark.

Market Overview

Asian markets traded sideways on Friday’s session as investors awaits to the main event of the week, U.S. monthly Jobs report , that will go out later today.

Hong Kong’s Hang Seng Index fell 0.25% at the end of morning trade while the Shanghai Composite gained 0.36%.

Australia’s S&P/ASX 200 lost 0.1% and South Korea’s KOSPI fell 0.3%. Japan’s Nikkei 225 eased down 0.44%.

Overnight, U.S. stocks edged lower in a nervous session after the publication of mix economic data and ahead of today’s March jobs. As always, investors prefer to move sideways and take some risk of the table ahead of this publication.

In Europe, As largely expected, ECB President Draghi, took no new action in yesterday rate decision but he did emphasize the central bank’s willingness to act if inflation stayed low mainly. This emphasize came due to deflation risk that is now threaten to spread in Europe.

In his statement, Draghi stated that his council supports any unconventional easing if needed. This “support” marked a major change as some countries, notably Germany, who has long opposed steps such as quantitative easing.

Draghi’s Council unanimous vote that supports unconventional easing sent the Euro to trade near a five-week low’s touching as low as 1.3694.

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