Morning Update – 12/04/2017 – by Arjun Lakhanpal

Morning all.. After a weak start, US stocks rebounded and calmed nerves somewhat after US yields and the dollar fell on risk averion to geopolitical tensions. The S&P finishing down just 0.14%..In Asia we had a mixed session with the Nikkei down 1.27% on the back of a steep fall in USDJPY in NY that saw it break 110.00 support. The low overnight was 109.35. Fitch: affirms United States at AAA, outlook stable; US’s ‘AAA’ rating is underpinned by sovereign’s unparalleled financing flexibility as issuer of world’s preeminent reserve currency; government debt burden is a relative credit weakness compared with other AAA sovereigns. Elsewhere BoJ’s Kuroda said if JPY weakens, price could meet inflation target more quickly; reiterates not targeting FX; will continue QQE with YCC to meet 2% px tgt and pursue appropriate monetary policy; sees no problems from asset purchases or expansion of monetary base but will keep economy and financial mkts in mind. On the data front we saw Japan March Bank Lending: +3.0% y/y; sharpest increase since May 2009-Japan Mar Wholesale Prices: +1.4% y/y vs +1.3% cons & +0.2% m/m in line. China: Slightly higher CPI but lower PPI in March . Le Pen, Macron tied in run-up to French election: Elabe poll.. Risk off tone remained the prevalent theme in Asian overnight as geopolitical risks related to conflicts in Syria and intimidation by North Korea are not abating. This morning we get Spanish and Portuguese CPI and UK unemployment data. BoE’s carney due to speak at 09:30 BST.. Good luck.