Market Roundup
•Fed vows to keep benchmark interest rate near zero
•US Nov Core Retail Sales (MoM) -0.9% , 0.1% forecast, 0.2% previous
•US Nov Retail Sales (YoY) 4.10%, 5.68% previous
•US Nov Retail Sales (MoM) -1.1%, -0.3% forecast, 0.3% previous
•US Nov Retail Sales Ex Gas/Autos (MoM) -0.8%, 0.2% previous
•US Nov Retail Control (MoM) -0.5%,0.2%,0.1% previous
•Canada Oct Foreign Securities Purchases 6.92B, 4.46B previous
•Canada Oct Foreign Securities Purchases by Canadians 7.96B, 11.17B previous
•Canada Oct Wholesale Sales (MoM) 1.0%, 0.9% , 0.9% previous
•Canada Oct Common CPI (YoY) 1.5%, 1.6% previous
•Canada Nov Core CPI (MoM) 0.2%,0.4% previous
•Canada Nov Core CPI (YoY) 1.5%, 1.0% previous
•Canada Nov CPI (YoY) 1.0%,0.8% forecast,0.7% previous
•Canada CPI (MoM ) 0.1%,0.2% forecast, 0.4% previous
•US Dec Manufacturing PMI 56.5,55.7 forecast, 56.7 previous
•US Dec Services PMI 55.3, 55.9 forecast, 58.4 previous
•US Markit Composite PMI 55.7, 58.6 previous
•US Oct Business Inventories (MoM) 0.7%, 0.7% forecast, 0.7% previous
•US Dec NAHB Housing Market Index 86,86, 86 forecast, 90 previous
•US Retail Inventories Ex Auto 0.8%, 0.7% previous
•US Crude Oil Inventories-3.135M, -1.937M forecast, 15.189M previous
US Fed Interest Rate Decision 0.25% ,0.25% forecast, 0.25% previous
Looking Ahead - Events, Other Releases (GMT)
•21:45 New Zealand GDP Annual Average (Q3) -3.0% forecast, -2.0% previous
•21:45 New Zealand GDP (QoQ) (Q3) 13.5%,-12.2%previous
•21:45 New Zealand GDP (YoY) (Q3) -1.3%,13.5%,-1.3%
•23:50 Japan Foreign Bonds Buying 1,252.7B previous
•23:50 Japan Foreign Investments in Japanese Stocks 42.1B previous
•00:30 Australia Nov Participation Rate 66.0%forecast, 65.8% previous
•00:30 Australia Nov Employment Change 50.0 previous ,178.8K previous
•00:30 Australia Nov Full Employment Change 97.0K previous
Looking Ahead - Events, Other Releases (GMT)
• No significant events
Currency Summaries
EUR/USD: The euro strengthened against dollar on Wednesday as strong euro zone survey figures and hopes of progress on Brexit negotiations boosted euro across the board. The euro has been gaining since the European Union announced a recovery fund in May, rising nearly 13% since then. Economic activity data in recent months have also boosted bets that Europe is outperforming the U.S.Those expectations got a further boost with manufacturing survey data from Germany and France indicating that Europe’s biggest economies may be recovering quickly. The euro was up 0.31 percent at $1.2192. Immediate resistance can be seen at 1.2193 (23.6% fib), an upside break can trigger rise towards 1.2212 (Daily high).On the downside, immediate support is seen at 1.2147 (5DMA), a break below could take the pair towards 1.2130 (38.6%fib).
GBP/USD: Sterling gained against the dollar on Wednesday as positive soundings from the European Union on Brexit talks boosted sterling against the dollar. Upbeat mood music around a possible Brexit deal before the year-end has helped the pound strengthen over 2% against the dollar this week. However, caution still shows in elevated implied volatility gauges which imply traders buying protection against price swings in the currency. Immediate resistance can be seen at 1.3558 (23.6%fib), an upside break can trigger rise towards 1.3600 (Psychological level).On the downside, immediate support is seen at 1.3493 (38.2%fib ), a break below could take the pair towards 1.3441 (50%fib).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Wednesday, giving back some recent gains, as domestic data showed a steady profile for underlying inflation and after the Federal Reserve was less dovish than some investors expected. The Fed, in a policy statement, for the first time linked its $120 billion in monthly bond purchases to a set of economic conditions, but did not change the type or pace of assets being purchased. The Canadian dollar was trading 0.4% lower at 1.2744 to the greenback. Immediate resistance can be seen at 1.2796 (Daily high), an upside break can trigger rise towards 1.2799 (50%fib). On the downside, immediate support is seen at 1.2750 (38.2%fib), a break below could take the pair towards 1.2743(23.6%fib).
USD/JPY: The dollar edged higher against the Japanese yen on Wednesday after the Federal Reserve was less dovish than some investors expected. The U.S. dollar index rose to 90.713 after the Fed’s rate-setting committee on Wednesday said its monthly government bond purchase program will continue until the economy substantially improves. The policy sends a signal that the Fed is comfortable with some increases in longer-term U.S. yields. The dollar rose after the Fed statement, having earlier fallen to its lowest level since April 2018.The dollar index, which tracks the greenback versus a basket of six currencies, rose 0.144 point, or 0.16 percent, to 90.617. Strong resistance can be seen at 103.57(38.2%fib), an upside break can trigger rise towards 103.83 (50%fib). On the downside, immediate support is seen at 103.26(23.6%fib), a break below could take the pair towards 103.00 (Psychological level).
Equities Recap
European shares closed higher on Wednesday on upbeat regional business activity data, rising hopes of a Brexit trade deal and the possible roll-out of a COVID-19 vaccine on the continent before the new year.
The UK's benchmark FTSE 100 closed up by 0.88percent, Germany's Dax ended up by 1.52 percent, and France’s CAC finished the up by 0.31 percent.
Wall Street remained mixed on Wednesday, with the Nasdaq hitting a record high as investors awaited a potential fiscal economic stimulus package and after the Federal Reserve repeated a pledge to keep its benchmark interest rate near zero.
Dow Jones closed down by 0.15 percent, S&P 500 ended up 0.18 percent, Nasdaq finished the day down by 0.50 percent.
Treasuries Recap
The Treasury yield curve steepened slightly on Wednesday after the Federal Reserve said it would maintain its current bond-buying policy until significant progress in the U.S. economic recovery is made.
The benchmark 10-year yield was last up 0.4 basis point to 0.925%, while the 30-year bond yield was up 0.2 basis points to 1.666%. The move at the long end steepened the yield curve, with the spread between the two- and 10-year yield up 1.3 basis points to 80.2 basis points. The spread between the five- and 30-year yields was up 1 basis point to 129.5.
Commodities Recap
Gold rose on Wednesday on prospects for more stimulus measures after the U.S. Federal Reserve pledged to keep its benchmark interest rate near zero until an economic recovery is complete.
Spot gold was up 0.5% at $1,862.72 an ounce by 4:16 p.m. EST (2116 GMT). U.S. gold futures settled up 0.2% to $1,859.10.
Oil prices edged higher on Wednesday, buoyed by U.S. government data that showed crude stockpiles fell last week and by optimism about a coronavirus relief package in the United States.
Brent crude futures rose 32 cents to settle at $51.08 a barrel. U.S. West Texas Intermediate (WTI) crude futures rose 20 cents to settle at $47.82 a barrel.
