Macro Roundup (Apr 28)

SHANGHAI, Apr 28 (SMM) – This is a roundup of global macroeconomic news last night and what is expected in the day ahead. 

The US dollar declined on Monday as the plans to ease coronavirus-induced lockdowns by many countries boosted risk appetite and reduced demand for the safe-haven greenback.

Italy, which is been the second most affected country, is among the countries that have laid out plans to reopen more of their economy. A number of US states have eased restrictions on businesses, and more are ready to follow.

LME base metals ended mixed Monday, with tin advancing 3.35% to become the best performer. Zinc climbed 1.27%, lead added 0.77%, while copper shed 0.04%, aluminium fell 0.5% and nickel slipped 0.12%. 

SHFE nonferrous metals closed higher across the broad on Monday, with tin adding 3.5% to lead the way up. Zinc surged 2.1%, copper jumped 1.6%, lead and nickel advanced 1.3%, and aluminium rose 1.1%. The SHFE will keep its night trading session suspended until May 6.

US oil futures posted a loss of nearly 25% on Monday as concerns reemerged that worldwide storage will soon fill as the coronavirus pandemic continues to roil demand.

West Texas Intermediate for June delivery fell 24.56% to settle at $12.78 per barrel, after earlier trading as low as $11.88. International benchmark Brent crude dipped 6.76% to settle at $19.99.

OPEC and allies are slated to implement output cuts equating to 9.7 million barrels per day, about 13% of global production, on May 1 through June, but that is viewed by experts as doing little to address a global glut.

On the data front, profits of China's major industrial firms dropped 36.7% year on year in the first quarter, said the National Bureau of Statistics (NBS) Monday, but the decline narrowed in March as the economy began recovering from the strain of coronavirus.

According to the NBS data, the profits of China's major industrial firms fell to 781.45 billion yuan in the first quarter. The decline narrowed 1.6 percentage points from the 38.3% fall experienced in January and February.

"The resumption of work and production of enterprises continued to accelerate and sales of industrial products began to pick up," said NBS official Zhang Weihua in an analysis published on the agency's website. "The corporate profits show some positive changes."

Nonetheless, "due to the fact that market demand has not yet fully recovered, enterprise product inventories have increased, industrial product prices have continued to fall and cost pressures are still large," said Zhang. "The profitability situation is still not optimistic."

Key economic data slated for release today include the US wholesale inventories for March and the Conference Boards consumer confidence index for April. 

Traders will be next focused on a US Federal Reserve meeting that will end on Wednesday and a European Central Bank (ECB) meeting on Thursday.