Daily Market Report - 15/02/2016

USD

US retail sales for January came out stronger than expected, with monthly retail sales in January growing by 0.2% versus an expectation of 0.1% and the ex-Autos adjusted retail sales figure rising by 0.1% versus an expectation of 0.0%. This lent credibility to the notion that the Federal Reserve may still raise rates more than once in 2016 and the US Dollar saw some strength on Friday afternoon as a consequence.

EUR

Annual GDP growth for the European Area came out in line with expectations at 1.5% (down on last month’s print of 1.6%), but quarterly GDP growth was better than expected, at 0.3% versus an expectation of 0.0%.
European stock exchanges rose on Friday, rebounding from the previous session's steep losses, with encouraging results from Commerzbank and a rally in oil prices helping banks and commodity-related stocks to regain ground. The pan-European FTSEurofirst 300 was up 1.4 percent at 1,212.47, having closed down 3.7 percent on Thursday, when a slump in banks and resource-related stocks pushed the index to a 2.5 year low. Banks were in favour on Friday, with Commerzbank up 12 percent after it returned to profit in the fourth quarter as provisions for bad loans fell, allowing it to draw a line under a six-year restructuring by announcing to close its 'bad bank' comprising non-core assets.

OIL

Global oil prices surged as much as 12 percent on Friday after a report once again suggested OPEC might finally agree to cut production to reduce the world glut, while a bounce in stock markets fed appetite for risk. Despite the strong daily gain, oil prices were poised to end the week down as much as 5 percent.
The Wall Street Journal reported on Thursday that the United Arab Emirates' energy minister said OPEC (the Organization of the Petroleum Exporting Countries) was willing to cooperate on an output cut. Many traders were skeptical at first about the report, noting that Venezuela and Russia had tried in vain earlier in the week to stir Saudi Arabia and other major producers into agreeing to output cuts. But after a 75 percent price slump since mid-2014 that has taken crude prices to more than 12-year lows, many were inclined to believe that a rebound was due sooner or later if production tightens or demand picks up.

Key Announcements

USD – Bank Holiday Today
14:00 – EUR – ECB President Mario Draghi Speech