Crude oil rallied to an 8-week high of 82.41 earlier on the day as USD weakened and concerns over Greek debt crisis eased. However, price then pared gains as the dollar rebounded and China implemented further measures to curb lending. The front-month contract for WTI crude oil ended the day at 81.87, +0.45%. Today in Asia, energy prices continue pull back as the market anticipates industry reports will show stock builds in the previous week.

Although we have not seen actual figures showing Greece's budget deficits are reducing, investors' confidence have come back dramatically after the French president Nicolas Sarkozy said that 'if it were necessary, the states of the euro zone would fulfill their commitments...and 'we have measures, we are ready, we are determined' to help Greece if it is needed.

The German Finance Minister Wolfgang Schaeuble's comments that the EU is to prevent sovereign crisis from happening (potential measure includes creation of a European Monetary Fund) also boosted market sentiment.

Apart from policymakers' promises that drove investors to the euro and other risky assets, several economic data released also supported the view that world recovery is underway. The Eurozone Sentix Investor Confidence improved to -7.5 in March from -8.2 in the previous month, which the analysts had anticipated a rise to -8. In Canada, housing starts increased to +197K in February from 186.3K a month ago. Consensus forecast was a pullback to 186K.

Another positive news to oil bulls may be Iran's OPEC governor said that 100 dollar is a good price for oil!

However, the dollar rebounded later in the NY session as the market eventually factored in the risk of China's plan to abort all guarantees that local governments have provided for financial vehicles. The Chinese government will also issue regulations later this month to ban all futures guarantees of this kind. In China, local governments are not allowed to borrowing directly. Therefore, they set up investment vehicles to raise money.

The precious metal was mixed. While gold and silver decline PGMs surged amid tight supply. Benchmark contracts for gold and silver dropped -1% and -0.6% to 1124 and 17.272, respectively. Gold weakened as the New York Fed President, Brian Sack, said that preparation of tools to withdraw liquidity (including reverse repos and term deposit facility) is 'advancing very effectively' and it will 'drain a significant portion of excess reserves by the second half of the year'. While the Fed should retain its accommodative monetary policy for most of the time this year, Sack's speech triggered fears of tightening and this weighed on gold. We saw the fed funds rate and T-bill yields rise modestly. Yi Gang's, head of the State Administration of Foreign Exchange's, comment that the Chinese government will be cautiously watching the gold and precious metal market and that gold may not provide good return based on historical data might have pressured the metal, too.

Platinum soared +1.3% to close at 1600.1 as it caught up with palladium which rallied +10% last week. Palladium, on the other hand, slid -1.1% to close at 471.35 as the rally in the past 2 weeks sent the metal to a 2-year high. Retreat is seen in both metal but we believe it's due to profit-taking, instead of any change in fundamentals.