Market Roundup
- U.S. Congress meets briefly, takes no steps to end shutdown.
- Corbyn - Labour bid to force general election matter of 'when, not if'.
- BOJ at logger-heads on how much yield falls to tolerate - Dec summary.
- Japan factory output falls, sales slow as risks to economy rise.
- U.S. stock funds attract cash for 1st time in 6 weeks – Lipper.
- U.S. muni bond funds post $931.4 mln in inflows – Lipper.
- Foreign CB US debt holdings -$6.261 bln to $3.396 tln Dec 26 week.
- Treasuries -$4.625 bln to $3.023 tln, agencies -$1,146 mln to $307.564 bln.
Economic Data Ahead
- (0430 ET/0930 GMT) UK Nov UK Finance Mortgage Apps, 39.697k previous.
- (0800 ET/1300 GMT) Germany Dec CPI Prelim Y/Y, 1.9% forecast, 2.3% previous.
- (0800 ET/1300 GMT) Germany Dec HICP Prelim Y/Y, 1.9% forecast, 2.2% previous.
Key Events Ahead
- No major events are scheduled for the day.
FX Recap
USD: The dollar index, a gauge of its value versus six major peers, fell by around 0.15 percent to 96.34, after losing 0.5 percent overnight.
EUR/USD: The euro gained 0.2 percent, fetching $1.1457. But the single currency has struggled this year due to weak euro zone data, low inflation and political risks. That has led to the European Central Bank maintaining ultra-low interest rates. The euro is on track for a loss of 4.5 percent versus the greenback this year. A consistent close below $1.1429 will drag the parity down towards key supports around $1.1342, $1.1288, $1.1185 and $1.1080 levels respectively. Alternatively, reversal from key support will drag the parity higher towards key resistances around $1.1472, $1.1550, $1.1620 and $1.1820 marks respectively.
USD/JPY: The Japanese yen appreciates against U.S. dollar after mixed economic data and was currently trading around 110.55 marks. It made intraday high at 111.01 and low at 110.52 levels. A sustained close above 110.95 is required to take the parity higher towards key resistances around 111.40, 112.60, 113.98, 114.55, 115.25 and 117.98 marks respectively. Alternatively, a daily close below 110.95 will drag the parity down towards key supports around 110.27, 109.24, 108.72 and 107.90 marks respectively.
GBP/USD: The Sterling held above a three-day low on Thursday as investors remained sidelined awaiting another round of Brexit developments, as a broadly weaker dollar offered some support to the struggling British currency. Against the dollar, the pound was broadly steady at $1.2635 after climbing as much as 0.2 percent to $1.2665 in the Asian session. Versus the euro, the pound was down 0.4 percent at 90.14 pence. A sustained close below $1.2643 requires for dragging the parity down towards key supports around $1.2486 and $1.2150 mark. On the other side, key resistances are seen at $1.2760, $1.3047, $1.3187, $1.3215, $1.3362 and $1.3490 levels respectively.
AUD/USD: The Aussie erases previous loss against U.S. dollar and remains well supported above $0.70 mark. The pair made intraday high at $0.7053 and low at $0.7025 levels. Immediate support and resistance levels were seen at $0.7020 and $0.7303 mark respectively.
NZD/USD: The kiwi trades almost flat against U.S. dollar. Major support is down at $0.6632, with resistance around $0.6969. Pair made intraday high at $0.6714 and low at $0.6694 levels. A sustained close above $0.6697 is required to take the parity higher towards $0.6746, $0.6814 and $0.7050 mark respectively. Alternatively reversal from key resistance will take the parity down towards key supports around $0.6632 and $0.6402 levels respectively.
Equities Recap
Japan's Nikkei was trading 0.20 pct lower at 20,034.55 points.
Australia’s S&P/ASX 200 was trading 1.02 pct higher at 5,654.02 points.
Shanghai composite index to open flat at 2,483.62 points and China's CSI300 index to open up 0.1 pct at 2,994.80 points.
Taiwanese stock was trading around 0.32 percent higher at 9,672.93 points.
India’s NSE Nifty was trading around 0.86 percent higher at 10,872.22 points while BSE Sensex was trading 0.88 points higher at 36,124.58 points.
South Korea’s Kospi was trading 0.78 percent higher at 2,044.44 points.
Hong Kong’s Hang Seng was trading 0.26 pct higher at 25,544.55 points.
Commodities Recap
Oil prices jumped as much as 3 percent on Friday to win back a chunk of the ground they lost in the previous session, but growth in U.S. crude stockpiles and ongoing concerns about the global economy kept markets under pressure. Brent crude was up $1.18, or 2.26 percent, at $53.34 a barrel at 0219 GMT, having earlier risen as much as 3.1 percent. It dropped 4.24 percent, or $2.31, the day before to settle at $52.16 per barrel. U.S. West Texas Intermediate (WTI) crude future, were at $45.62 a barrel, up 2.26 percent, or $1.01, after earlier rising 3.6 percent. They ended Thursday down 3.48 percent, or $1.61, at $44.61 a barrel..
Gold inched higher on Friday to trade below a more than six-month high hit earlier this week, as concerns about slowing global economic growth and a partial government shutdown in the United States stoked safe-haven demand, although gains in equities capped the upside. Spot gold had risen by 0.2 percent to $1,277.75 per ounce as of 0448 GMT, and was set for a second straight weekly gain with no end in sight for China-U.S. trade tensions and political uncertainty in the United States. The precious metal had hit its highest level since June 19 at $1,279.06 on Wednesday. U.S. gold futures inched down 0.1 percent to $1,280.2 per ounce on Friday.
Treasuries Recap
U.S. treasury yields trim decline as Dow, S&P turn positive; 10-year yield last at 2.7738 pct.
U.S. 10-year treasury yield at 2.775 pct on Friday vs U.S. close of 2.743 pct.
Benchmark 10-year JGB futures open up 0.11 point.
