Middle East tensions

Asia stocks pared early gains as caution crept in ahead of the U.S. earnings season and as investors weighed the possible impact on global growth from a tariff spat between the United States and China. Trade tensions between the U.S. and China that have gripped traders’ attention in recent weeks were also defused as Trump said that the two countries may not end up levying new tariffs on each other following conciliatory remarks on Tuesday by Chinese President Xi Jinping. Meantime, data showed China’s exports in yuan terms slid 9.8 percent in March, belying economists’ predictions of 8 percent gain.

President Donald Trump and his national security aides on Thursday discussed U.S. options on Syria, where he has threatened missile strikes in response to a suspected poison gas attack, as a Russian envoy voiced fears of wider conflict between Washington and Moscow.

Russia, Syria and its other main backer, Iran, have said reports of the Douma attack were fabricated by rebels and rescue workers and have accused the United States of seeking to use it as a pretext to attack the Syrian government.

In Commodities Oil prices edged lower following suggestions from U.S. President Donald Trump that a military strike on Syria may not be imminent. They are still set for their biggest weekly gains since last July. Brent crude futures were off 20 cents at 71.82 a barrel, near Wednesday’s high of 73.09. U.S. WTI crude futures slipped 20 cents to 66.89. Gold prices dropped 1.3% on Thursday, the biggest one-day percentage fall since March 28. Earlier on Friday Prices gained on tensions over Syria.

In currency markets EURUSD traded flat at 1.2325, gaining 0.4% for the week, supported by comments from European Central bank officials that reinforced expectations toward monetary policy normalization. USDJPY is trading highest since late February at 107.60 up by0.3% for this week.

The trading session for the week 9-13 April 2018 is ending today with a thin economic calendar. Some of the key economic data to pay attention to US Prelim UoM Consumer Sentiment, German Final CPI m/m. Moderate to high volatility is expected for the Euro and the US Dollar.