Talking Points:

• Commodity bloc FX recovers, Yen falls as risk appetite firms in Asian trade
• Quiet economic data docket puts sentiment trends in focus into the week-end
• Worries about soft 1Q earnings season may unleash renewed risk aversion

The sentiment-linked Australian, Canadian and New Zealand Dollars rose traded higher alongside S&P 500futures while the anti-risk Japanese Yen declined in overnight trade. The moves looked corrective following the onset of risk aversion in the prior session that pushed the US equities benchmark to a weekly low while commodity-bloc FX swooned and the Yen winning streak extended for a fifth consecutive day.

A relatively quiet economic calendar through the remainder of the trading week seems likely to make for a sentiment-centric mood into the week-end. That may augur a repeat of yesterday’s performance on Wall Street, where the latest bout of selling pressure probably reflected pre-positioning ahead of the first-quarter corporate earnings reporting season starting next week.

Collectively speaking, earnings per share for the companies making up the S&P 500 are expected to have fallen 7.9 percent year-on-year in the first three months of 2016. Fears of such dour results may inspire continued unwinding of risk-on exposure, leading shares downward and pulling higher-yielding currencies in the same direction.

Asia Session

European Session

Critical Levels