Risk sentiment sudden reversal after FOMC minutes - Westpac

Analysts at Westpac explained that risk sentiment improved modestly prior to the release of the Fed minutes, with equities at a two-week high, treasuries steady and the USD generally firmer. The market response to the news that most Fed committee members favour starting shrinking the balance sheet this year was modest. 

Key Quotes

US equities fell modestly into the close, and US 2- and 10-year yields are lower. Earlier, European equities were mixed. Oil prices initially fell on a surprise inventory build before stabilising, while gold had a U-shaped round trip to be down 0.1%.

The ADP employment report for March was much stronger than expected, boding well for non-farm payrolls, despite downward revisions to February. On the other hand the non-manufacturing ISM unexpectedly dipped, with most components dropping. The data still suggests the services sector is expanding, but momentum may have topped out."