Market wrap: concerns over US Administration - Westpac

Analysts at Westpac offered a market wrap as follows:

Key Quotes:

"Global market sentiment: The US dollar and interest rates fell overnight, partly reflecting concerns about developments in the Administration.

Senate majority leader McConnell called for less drama in the White House, and dampened expectations of fiscal stimulus from Trump’s border tax, Dodd-Frank, tax cut and healthcare initiatives. There was also lingering unease following the intelligence leaks to Russia.

Interest rates: US 10yr treasury yields fell from 2.36% to 2.30% while McConnell spoke, but partly recovered to 2.33% afterwards. Fed fund futures yields were little changed, pricing a June rate hike as an 85% chance.

Currencies: The US dollar index is down 0.8% on the day, at a level last seen in November 2016. EUR rose from 1.1000 to 1.1097. USD/JPY fell from 113.75 to 112.94. AUD bounced off 0.7395 to 0.7438. NZD underperformed, despite a modest upside surprise from the GDT dairy auction, slipping from 0.6902 to 0.6863 and partly retracing to 0.6894. AUD/NZD rose from 1.0746 to 1.0800."