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Asia Roundup: EUR/USD hits fresh 2-week high at 1.0653, most Asian markets marginally higher, gold touches $1,160 mark - Friday, December 30, 2016

Market Roundup

  • Australian private sector i.e business credit +0.5% in Nov vs +0.5% month prior - RBA.
     
  • Housing credit +0.5% in Nov from +0.6% prev - RBA.
     
  • PBOC sets yuan mid-point at 6.9370 / dlr vs 6.9497 previous close.
     
  • China will focus on freeing up foreign investment in banking, insurance, securities, futures as part of opening up of services sector - State planner.
     
  • China will relax foreign investment restrictions on credit-rating service.
     
  • China will "orderly" open up sensitive areas such as telecoms, education, and internet to foreign investment.

Economic Data Ahead

  • (0300 ET/0800 GMT) Spain Current Account Balance bln EU Oct, last 1.5.
     
  • (0300 ET/0800 GMT) Spain HICP Flash YY % Dec, last 0.5.
     
  • (0400 ET/0900 GMT) Norway Central Bank Currency Purchase mln Jan, last -900.00.
     
  • (0400 ET/0900 GMT) Italy Producer Prices YY % Nov, last -0.60.
     
  • (0400 ET/0900 GMT) Italy Producer Prices MM % Nov, last -0.10.

Key Events Ahead

  • No key events scheduled for the day.

FX Recap

USD: The dollar index was down at 102.36. The index has gained 4.4 percent this year, the bulk of the rise taking place after the U.S. elections early in November.

EUR/USD: The euro jumped to its highest in three weeks in holiday-thinned Asian trade on Friday, but was on track for a losing year on expectations that U.S. President-elect Donald Trump's policies will boost inflation and prompt the U.S. Federal Reserve to hike interest rates at a faster pace. The euro was last up 0.8 percent at $1.0570 after briefly spiking to $1.0700, its highest since Dec. 8. On the last trading day of 2016, it was down 2.6 percent against the dollar for the year. Immediate resistance was seen at $1.0670 level. A daily close below 1.0408 will drag the parity down towards 1.0382 levels.  

USD/JPY: The yen was down against the U.S. dollar in early hours of Asia and trading around 116.78 mark. The yen lost 3.3 percent for the year, but considerably pared its losses after the Nov. 8 U.S. presidential election. A sustained close above 117.24 is required to take the parity higher towards 118.66 and 120.00 marks. Alternatively, a daily close below 117.24 will drag the parity down towards 114.81 levels.

GBP/USD:   Sterling rose 0.2 percent to $1.2293, moving away from a two-month low of $1.2201 plumbed Wednesday. It was down 16.6 percent in a year marked by Britain's June vote to exit the European Union. Short term bias remains bullish till the time pair holds key support at 1.2209 levels.  On the other side, current upside movement will take the parity higher towards key resistance around 1.2378, 1.2417 levels respectively.

AUD/USD:  Against its U.S. counterpart, the Aussie was up 0.36 percent at $0.7238 and off a seven-month trough of $0.7160 hit last week. The Aussie is down nearly 2 percent in December and 0.6 percent for the year, its fourth straight annual loss. Pair made intraday high at 0.7246 and low at 0.7214. A consistent close below 0.7165 will drag the parity towards key supports around 0.7142 and 0.7058 marks respectively. On the top side, key resistances are seen at 0.7257, 0.7312 and 0.7369 marks.

NZD/USD: The New Zealand dollar barely moved on Friday to stay at $0.6965, not far from a seven-month low of $0.6863 touched last week. The Kiwi is set to end the week 1.2 percent higher after two straight losses. For the year, it is on track for a gain of 2 percent following three consecutive years of negative returns.

Equities Recap

Tokyo's Nikkei was trading 0.16 percent higher at 19,151.26 points.

Australia’s S&P ASX 200 was trading 0.58 percent lower 5,665 points.

Hong Kong’s Hang seng was trading 0.82 percent higher at 21,969 points.

Shanghai composite index to open flat at 3,097.35 points and China's CSI300 index to open up 0.2 pct at 3,302.60 points.

Taiwan stocks open up 0.4 pct at 9,186.30 points.

India’s NSE Nifty was trading around 0.64 percent higher at 8,155.70 points and BSE Sensex was trading at 0.61 percent higher at 26,528 points.

Commodities Recap

Oil prices are on track for their biggest annual percentage gain since 2009 on the back of an agreement struck between OPEC and non-OPEC countries to cut crude production output. U.S. benchmark West Texas intermediate (WTI) crude futures were up 15 cents or 0.3 percent at $53.92 at 0408 GMT. Brent front-month March crude oil futures were 14 cents a barrel or 0.3 percent higher at $56.99.

Spot gold was up 0.1 percent at $1,159.36 an ounce by 0325 GMT, having earlier hit a more than two-week high of $1,163.14 an ounce. The metal rose over one percent in the previous session, its biggest daily percentage gain since late September. Gold has added more than 9 percent so far this year despite a steep fall in November, following three successive years of losses.

Treasuries Recap

New Zealand government bonds rose, sending yields about 3 basis points lower across the curve.

Australian government bond futures eased, with the three-year bond contract and the 10-year contract off 1 tick each at 97.92 and 97.175 respectively.

10-year U.S. treasury yield was at 2.465 percent vs U.S. close of 2.477 percent on Thursday.

 

 

 

 

 

 

 

 

 

 

 

 

 

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