After weeks of squabbling Eurozone finance ministers finally agreed to extend bailout funding for Greece by an additional four months overnight. The agreement, conditional on Greece announcing a series of acceptable reform measures on Monday, will allow the nation time to work towards a longer-lasting funding agreement later in the year. To read the statement from the Eurogroup in full click here.

Earlier this morning Moody’s downgraded Russia’s sovereign debt rating to Ba1, a move that now sees the nation’s debt classified as ‘junk’ status. The agency also left the nation’s rating on watch negative, something that suggests further downgrades are possible in the months ahead.

US manufacturing activity accelerated at a faster pace in February with Markit’s flash manufacturing PMI gauge rising to 54.3 from 53.9 in January. Despite the headline beat the internals were hardly convincing with gauges on new orders and employment falling to 13 and 7-month lows respectively.

Canada retail sales plunged by 2.0% in December, well below the 0.4% increase of November and expectations for a decline of 0.4%, with the figure the largest monthly contraction seen since April 2010. Excluding auto sales the news was even worse with a drop of 2.3% recorded. The figure was well below expectations for a decrease of 0.8% and was the largest monthly decline since December 2008.

Eurozone private-sector business activity continued to accelerate in February with Markit’s flash composite PMI gauge rising to 53.5. The reading, higher than the 52.6 level of January and expectations for an increase to 53.0, was the highest level seen since July. Services, up 1.2pts to 53.9 thanks to strong readings from Germany and France, did most of the heavy lifting although manufacturing, up 0.1pts to 51.1, also contributed to lift in the composite reading. To performance of the two-largest Eurozone economies, Germany and France, is found below.

Germany: Manufacturing 50.9 (Prior 50.9, Expected 51.5). Services 55.5 (Prior 54.0, Expected 54.2)

France: Manufacturing 47.7 (Prior 49.2, Expected 49.5). Services 53.4 (Prior 49.4, Expected 49.8)

UK retail sales missed to the downside in January with a fall of 0.3% reported. The reading, below the downwardly-revised 0.2% increase of December and expectations for a similar decline in January, left the annual increase at 5.4%, below the 5.9% level expected. Excluding fuel core sales slumped by 0.7%, the largest contraction since January 2014, leaving the annual rate at 4.8%, some 1.1% below the pace expected.

German producer prices fell by 0.6% in January, less than the 0.7% decline of December but below expectations for a decrease of 0.4%, with the annual rate slipping to -2.2%, the fastest decline recorded since February 2010.

Italian industrial orders jumped by the most since January 2014 in December with an increase of 4.5% reported. The surge, coupled with stronger data rolling off the series, saw the annual rate jump to 5.8% from -4.10% in November. While not as strong as the surge in orders sales also increased, up 0.9%, leaving the annual rate in positive territory at 1.4%.

Italian consumer prices fell 0.4% in January, unchanged from the preliminary estimate released earlier in the month, with the annual rate remaining at -0.6%, the lowest level seen since September 1959. Using EU-methodology prices fell by 2.5%, greater than the initial estimate of 2.4%, with the year-on-year rate sliding to -0.5% from -0.1% in December.


Monday’s Session Ahead (AEDT)

The ASX 200 looks set to open the week in the black with SPI futures pointing to a rise of 14pts on the open.

The AUDUSD closed the week buying .7842 after pushing higher over the course of European and North American trade. Resistance is located at .7860, .7900 and .7940 with support kicking in at .7825, .7800 and again below .7780.

Chinese and Hong Kong markets remain closed Monday for Lunar New Year celebrations.

Data releases Monday evening include existing home sales, the Chicago Fed national activity index and Dallas Fed manufacturing index from the States, German IFO business survey along with UK retail turnover.


Market Map Feb 21 2015


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