Market Roundup
- Waiting for May, Brussels eyes December Brexit deal
- UK sees weak growth, more borrowing, but Hammond says will spend
- German Social Democrats face pressure over coalition talks
- Fed policymakers say rate increase likely warranted soon -minutes
- JPMorgan's Dimon says Trump likely to be a one-term president
- China fixes yuan midpoint at 5-week high, biggest one-day strengthening since Oct.11
- Australia urges strong, sustained U.S. engagement in Asia, warns on China
- New Zealand Q3 retail sales vols +0.2 q/q from +2.0% and 4.1% vs yr ago from 5.4% - Stats NZ
- Cuba, North Korea reject 'unilateral and arbitrary' U.S. demands
- S. Korea considers scrapping exercise with U.S. for Olympics – Yonhap
Economic Data Ahead
- (0200 ET/0700 GMT) Germany Q3 GDP Detailed QQ f' cast 0.8%, 0.8% last
- (0200 ET/0700 GMT) Germany Q3 GDP Detailed YY NSA f'cast 2.6%, 2.3% last
- (0300 ET/0800 GMT) France Nov Markit Mfg Flash PMI f'cast 55.9, 56.1 last
- (0300 ET/0800 GMT) France Nov Markit Comp Flash PMI f' cast 57.2, 57.4 last
- (0330 ET/0830 GMT) Germany Nov Markit Mfg Flash PMI f' cast 60.4, 60.6 last
- (0330 ET/0830 GMT) Germany Nov Markit Comp Flash PMI f' cast 58.3, 58.5 last
- (0400 ET/0900 GMT) EZ Nov Markit Mfg Flash PMI f' cast 58.3, 58.5 last
- (0400 ET/0900 GMT) EZ Nov Markit Comp Flash PMI f' cast 56.0, 56.0 last
- (0430 ET/0930 GMT) Great Britain Q3 GDP 2nd Release q/q, f' cast 0.4%, 0.4% last
- (0430 ET/0930 GMT) Great Britain Q3 GDP 2nd Release y/y, f' cast 1.5%, 1.5% last
- (0700 ET/1100 GMT) Great Britain Q3 Nov CBI Distributive Trades f' cast 5, -36 last
Key Events Ahead
- (0335 ET/0835 GMT) ECB's Praet participates in a discussion – Luxemborg
- (0730 ET/1230 GMT) ECB Monetary Policy Meeting Accounts
- (1130 ET/1630 GMT) SNB's Jordan speaks at Univeristy of Basel – Basel
- (1315 ET/1815 GMT) ECB's Coeure speaks at a ceremony – Paris
FX Beat
DXY: The dollar index slumped to 1-month lows on speculation the Federal Reserve might not tighten U.S. policy as aggressively as previously thought. The greenback against a basket of currencies traded down at 93.23, having touched a low of 93.16 earlier, its lowest since Oct. 20. FxWirePro's Hourly Dollar Strength Index stood at -9.59 (Neutral) by 0500 GMT.
EUR/USD: The euro rallied to a 1-week high after data showed Eurozone consumer confidence rose to its highest level in nearly 17 years in November. The Eurozone's flash estimate consumer morale increased to 0.1 from a revised -1.1 points in October, surpassing the expectation of -0.8 and recording its first positive reading of the index since January 2001. The European currency traded 0.1 percent up at 1.1835, having touched a high of 1.1838 earlier; its highest since Nov. 15. FxWirePro's Hourly Euro Strength Index stood at 16.67 (Neutral) by 0400 GMT. Investors’ attention will remain on series of PMI's from the Eurozone economies and ECB Praet Speech, while the United States markets remained closed for Thanksgiving. Immediate resistance is located at 1.1850, a break above targets 1.1880. On the downside, support is seen at 1.1800, a break below could drag it lower 1.1770 (5-DMA).
USD/JPY: The dollar steadied after falling to a two-month low following the release of the Federal Reserve's latest meeting minutes, which showed some policymakers were concerned about persistently low inflation. The major was trading 0.1 percent up at 111.28, having hit a low of 111.07 earlier, its lowest since Sept. 18. FxWirePro's Hourly Yen Strength Index stood at 24.54 (Neutral) by 0400 GMT. Immediate resistance is located at 111.85 (78.6% retracement of 114.73 and 111.07), a break above targets 112.27 (5-DMA). On the downside, support is seen at 111.00, a break below could take it near 110.64.
GBP/USD: Sterling rose to a 1-1/2 month high ahead of the UK second estimate Q3 GDP. The major largely gained on the back of broad-based U.S. dollar selling, in response to flattening of the Treasury yield curve and dovish FOMC minutes. Sterling traded up at 1.3325, having hit a high of 1.3336, it’s highest since Oct. 13. FxWirePro's Hourly Sterling Strength Index stood at 33.08 (Neutral) by 0400 GMT. Investors’ focus will remain on political developments, amid a Thanksgiving holiday in the U.S. Immediate resistance is located at 1.3350, and a break above could take it near 1.3402. On the downside, support is seen at 1.3240 (5-DMA), a break below targets 1.3198 (10-DMA). Against the euro, the pound was trading 0.1 percent down at 88.80 pence, having hit a high of 88.42 pence on Tuesday, it’s highest since Nov. 10.
AUD/USD: The Australian dollar rose, extending gains for the third straight session, as the greenback stayed on the backfoot post-Yellen's remarks, confirming that the inflation outlook remained soft and reinforcing the gradual outlook for Fed policy. The Aussie trades up at 0.7617, having hit a low of 0.7532 on Tuesday; it’s lowest since Jun. 14. FxWirePro's Hourly Aussie Strength Index stood at 123.09 (Highly Bullish) by 0500 GMT. Immediate support is seen at 0.7578 (5-DMA), a break below targets 0.7500. On the upside, resistance is located at 0.7642 (21-DMA), a break above could take it near 0.7667 (61.8% retracement).
NZD/USD: The New Zealand dollar steadied near a one-week high as better than expected third-quarter retail sales figures boosted investor sentiment. The Kiwi trades flat at 0.6878, having touched a high of 0.6893 the day before, its highest level since June 2016. FxWirePro's Hourly Kiwi Strength Index was at 30.05 (Neutral) by 0500 GMT. Immediate resistance is located at 0.6904 (38.2% retracement of 0.6979 and 0.6780), a break above could take it near 0.6932 (23.6% retracement). On the downside, support is seen at 0.6836 (5-DMA), a break below could drag it lower 0.6800.
Equities Recap
Asian shares traded in a narrow range with Japanese markets closed for a holiday and the United States off for Thanksgiving, while the dollar fell to a 1-month low against a basket of currencies after the minutes of the Federal Reserve's latest meeting highlighted policymakers concern over the inflation outlook.
MSCI's broadest index of Asia-Pacific shares outside Japan edged up 0.1 percent.
Australia's S&P/ASX 200 index down 0.03 percent to 5,985.30 points and South Korea's KOSPI eased 0.02 percent to 2,539.78 points.
Shanghai composite index fell 0.9 percent to 3,398.48 points, while CSI300 index was trading 1.5 percent down at 4,162.53 points.
Hong Kong’s Hang Seng was trading 0.01 percent lower at 30,001.66 points. Taiwan shares added 0.3 percent to 10,854.57 points.
Commodities Recap
Crude oil prices remained near recent peaks as the shutdown of the Keystone pipeline and a drawdown in fuel inventories pointed to a tightening market. International benchmark Brent crude was trading 0.2 percent down at $63.17 per barrel by 0426 GMT, having hit a high of $63.39 the day before, its highest since Nov. 13. U.S. West Texas Intermediate was trading 0.2 percent lower at $57.87 a barrel, after rising as high as $58.12, its highest since June 2015.
Gold prices edged lower after gaining nearly one percent in the previous session on weaker U.S. economic data and concerns by some Federal Reserve policymakers about lower. Spot gold was 0.1 percent down at $1,289.95 per ounce by 0431 GMT, having touched a low of $1,274.36 on Monday, its lowest since Nov. 14. U.S. gold futures for December delivery edged 0.1 percent lower at $1,290.70.
Treasuries Recap
The 10-year U.S Treasury yield stood at 2.356 percent lower by 0.005 bps, while 5-year yield was 0.008 bps down at 2.098 percent.
The Australian bonds traded a little firmer following firmness in the U.S. Treasuries after Federal Open Market Committee toned cautious about inflation in its October 31-November 1 monetary policy meeting minutes. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 1 basis point to 2.525 percent, the yield on the long-term 30-year note dipped 1 basis point to 3.265 percent and the yield on short-term 2-year fell 1 basis point to 1.777 percent.
The New Zealand bonds closed higher following weaker-than-expected retail sales data for the third-quarter of this year. In addition, firmer U.S. Treasuries also supported the bonds prices. At the time of closing, the yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 3 basis points to 2.790 percent, the yield on 20-year note also dipped 2 basis points to 3.380 percent and the yield on short-term 2-year ended 2 basis points lower at 1.970 percent.
The Canadian government bond prices were higher across the yield curve, although they lagged the rally in U.S. Treasuries. The Canada's two-year rose 1.5 Canadian cents to yield 1.455 percent and the 10-year climbed 10 Canadian cents to yield 1.907 percent. The gap between Canada's two-year yield and its U.S. equivalent narrowed by 3.8 basis points to a spread of -27.6 basis points.
