S&P 500 — US Large Cap Index
FTSE 100 — UK Blue Chips
Euro Stoxx 50 — Eurozone Leaders
DAX 40 — German Equities
CAC 40 — French Market Index
Nikkei 225 — Japan Benchmark
Hang Seng — Hong Kong Index
Shanghai Composite — China Mainland
ASX 200 — Australian Market
TSX Composite — Canada Index
Nifty 50 — India Large Cap
STI Index — Singapore Market
KOSPI — South Korea Index
Bovespa — Brazil Equities
JSE Top 40 — South Africa Index
IPC Index — Mexico Market
ING’s Francesco Pesole notes that the Norwegian Krone (NOK) has rallied sharply versus both US Dollar (USD) and Euro (EUR) in April, supported by resilient US equities and higher Oil prices. ING had flagged 10.80–10.85 as a landing zone for EUR/NOK this month, but now sees downside risks, especially as Norges Bank is expected to hike 25 bps on 7 May and may keep the door open to further tightening.
Krone rally and Norges Bank outlook
“The Norwegian krone has staged an impressive 4.2% rally vs USD and 2.9% vs EUR in April, with gains accelerating yesterday. The market conditions we saw yesterday were ideal for NOK outperformance. US equities’ resilience kept global risk sentiment afloat as oil prices increased.”
“We have recently identified 10.80-10.85 as a landing zone for EUR/NOK this month, but had probably underestimated risk sentiment resilience, and risks are definitely on the downside relative to those targets.”
“That’s especially true considering that we expect Norges Bank to hike by 25bp on 7 May, which is currently 19bp priced in. While our current forecast is that this will be a one-and-done move, the risks are for a follow-up hike later this year, and we doubt Norges Bank will close the door to more tightening in May.”
