JPY Passes 102 Mark, Weak Data From China

Welcome back to another exciting week in the markets, and today both the dollar and the Nikkei 225 have opened with nice gains in the Asian session. This follows the BoJ’s announcement that the Japanese M2 money supply moved up 3.3 percent in April to 844.5 trillion Yen. This beats expectations of 3.1 percent. M2 quantifies the amount of money circulating in a specific country while M3 quantifies the total supply of money including assets and deposits. The M3 money supply in Japan gained 2.6 percent last month too, to 1,142.0 trillion Yen, which beat the expected 2.5 percent.

We saw some key data to come out of China, which included retail sales, industrial production and fixed asset investment, which investors were waiting for. Industrial production figures in China gained 9.3 percent for last month, which comes below the expected 9.5 percent gain and follows on from March’s 8.9 percent gain. Retail Sales gained 12.8 percent last month, which falls in line with targets.

Other investors are cashing in profits from commodities made from the stronger dollar.

In Australia a report has been released showing that home loan approvals have gone up by 5.2 percent in March, surpassing expectations of a 4 percent increase.

Stocks
The M2 and M3 money supply data and the Yen falling to its lowest point since 2008, boosted the Nikkei 225 in Japan to new highs not seen since before 2008’s banking crash. The index gained over 1.5 percent before settling at 1.2. percent. The Hang Seng in Hong Kong crept down weighed down by raw material producers stocks after the weak Chinese data. Australia’s ASX/S&P 200 index moved downwards after Chinese data release too, pulled down by mining giants BHP Billiton and Rio Tinto.

Forex
The USD/JPY hit 102 during the session, its highest point in 4 1/1 years and then eased back down to 101.59 during Asian session, a 0.02 percent dip. Meanwhile the dollar continued to gain against the other currencies making new highs. The EUR dropped 0.13 percent against the dollar, the GBP lost 0.09 percent and the AUD lost 0.37 percent.

Commodities
Commodities were down as investors cashed in their gains on the strength of the dollar. Gold lost 0.275 percent, Silver 0.15 percent and Crude 0.77 percent down. While Natural gas continues falling on warm weather forecasts losing 0.325 percent.

What To Watch Today
The disappointing Chinese data should lead the European session while stock market futures point to weakened stocks in Europe. The euro-zone members are due to meet later today in Brussels. Then later will see the release of U.S. retail sales, which are an important driver of the U.S. economy.