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Choppy oil keeps risk in check

A fairly sanguine reaction to Chinese GDP growth in the first quarter. Released in the early hours, the data showed that China slowed to 6.7%, down from 6.8% in Q4. Retail sales and industrial production in China grew faster than expected in March to 10.5% and 6.8% respectively which has ultimately prevented any overtly bearish reaction to the news.
The US dollar continues to surge as has been the case over the past couple of days – with the dollar index looking to finish out the week higher – this would be the first week in 5 that the dollar has seen any strength.

USDJPY is still above the 109 level helped in part by Bank of Japan’s Kuroda call that the yen’s recent rise was ‘excessive’. And he’s probably not wrong, but there is still a risk of additional yen strength especially if equities fail to push higher from present levels.
EUR/USD is trading at the 1.12 handle, down from levels seen recently with the recent attempt to break higher against the US dollar following the more dovish policy signal form the Fed has failing at this point.

Recent ECB meeting minutes revealed a discussion about a deeper cut in rates and that the central bank has not reached its lower bound. This has helped keep the pair in check and been to the benefit of European indices – although these are trading marginally softer this morning.

Gold prices have been trending lower, but price action is at the 1225/30 handle of support, which could see a potential pullback if this support holds. The bias remains to the downside for the moment as prices could test the $1200 handle this time around in light of the renewed dollar strength.
Oil prices are choppy and news that the Iranian finance minister would not be attending the meeting in Doha has taken even more of the recent sheen of the commodity upside.

The Bank of England held back from doing anything different yesterday which was no surprise but the outlook is likely dim for sterling with the market more positioned for a rate cut than a hike in the near to medium term. Many expect at least 2 members to vote for a cut in due course. Support at $1.415 – 1.4126 will be key as a support failure here could send GBPUSD lower to 1.40 region.

Data is mostly US based today with the Empire State Manufacturing Index, Industrial Production as well as consumer sentiment data due later this afternoon.

European indices are mostly treading water this morning awaiting a catalyst but ultimately moving sideways following the fairly decent gains this week.

BP (+0.5%) BP’s Shareholders have taken action and voted against CEO Bob Dudley’s $20 m pay deal for 2015. After the company posted a record annual loss amidst tumbling oil prices, shareholders revolted against the CEO’s bumper pay packet.

SABMiller (+1.15%) Anheuser-Busch InBev will invest 1 billion rand ($69 million) to support small South African farmers as part of concessions agreed with the government to secure regulatory approval for its $100 billion-plus takeover of SABMiller, it said on Thursday. (Reuters)

Man Group (+6.14%)
CEO Emmanuel Roman of alternative investment management business cautioned that ‘the ongoing uncertainty in the markets remains challenging and, accordingly, the risk appetite of our clients has the potential to impact flows.’ Overall funds under management at Man were little changed at $78.6 bn at the end of the quarter from the fourth quarter.

Chipotle saw shares pop over 2.5% after JPMorgan took a shining to the company, arguing that a key sales metric is set to improve in the current quarter.

We call the Dow slightly lower to 17910.