Market Roundup
- Bitcoin slips to around $16,300, futures volumes drop
- Nearly half of Americans still oppose Republican tax bill -Reuters/Ipsos poll
- UK workers face renewed hit to spending power in 2018 - Korn Ferry
- US, EU, Japan to join forces on Chinese excess capacity -source
- China's banks dole out record credit in 2017 as Nov loans blow past forecasts
- S. Korea's Moon, China's Xi to talk N. Korea, trade in Beijing summit
- Japan Nov wholesale prices rise at fastest pace in 9 years
- Japan Inc bond float seen rising to 8-year high, @Y10.9 trln - Nikkei
- Australian business conditions pull back in November-survey
- Australian Q3 Home Price Index -0.2%, 1.9% last, f' cast 0.5%
- Prominent Australian opposition lawmaker quits over claims of China links
Economic Data Ahead
- (0430 ET/0930 GMT) Great Britain Nov CPI y/y, f' cast 3.0%, 3.0% last
- (0600 ET/1100 GMT) Germany Dec ZEW Economic Sentiment f' cast 18.0, 18.7 last
- (0600 ET/1100 GMT) Germany Dec ZEW Current Conditions f' cast 88.5, 88.8 last
FX Beat
DXY: The dollar index held gains near recent highs, as traders awaited the U.S. Federal Reserve's policy meeting outcome that will end on Wednesday. The greenback against a basket of currencies traded flat at 93.92, having touched a high of 94.09 on Friday, its highest since Nov. 22. FxWirePro's Hourly Dollar Strength Index stood at 48.39 (Neutral) by 0500 GMT.
EUR/USD: The euro consolidated within a narrow range as investors refrained from placing big bets ahead of Federal Reserve and European Central Bank's policy meeting decisions this week. The European currency traded 0.05 percent up at 1.1774, having touched a low of 1.1730 on Friday, its lowest since Nov. 21. FxWirePro's Hourly Euro Strength Index stood at 9.27 (Neutral) by 0400 GMT. Investors’ attention will remain on Eurozone and German ZEW Survey's, ahead of U.S. producer price index and monthly budget statement. Immediate resistance is located at 1.1812 (21-DMA), a break above targets 1.1848. On the downside, support is seen at 1.1732 (Nov. 22 Low), a break below could drag it lower 1.1712 (Nov 21. Low).
USD/JPY: The dollar slightly eased against the yen after rising to a near 1-month high in the previous session, ahead of the FOMC meeting outcome, where it is widely expected to hike interest rates at its two-day policy meeting that will end on Wednesday and tighten policy further next year. The major was trading 0.1 percent down at 113.47, having hit a high of 113.68 the day before, its highest since Nov. 14. FxWirePro's Hourly Yen Strength Index stood at -109.76 (Highly Bearish) by 0400 GMT. Investors’ will continue to track broad-based market sentiment, ahead of the U.S. producer price index and monthly budget statement for further momentum. Immediate resistance is located at 113.91, a break above targets 114.34. On the downside, support is seen at 113.30, a break below could take it near 112.98 (5-DMA).
GBP/USD: Sterling consolidated near recent lows ahead of Bank of England's meeting on Thursday and a raft of top-tier data including for retail sales, inflation and jobs due this week. The major traded 0.05 percent up at 1.3342, having hit a low of 1.3319 on Thursday, it’s lowest since Nov. 28. FxWirePro's Hourly Sterling Strength Index stood at -102.91 (Highly Bearish) by 0400 GMT. Investors’ focus will remain the UK retail sales, producer price index and consumer price index, ahead of U.S. fundamental drivers. Immediate resistance is located at 1.3404 (5-DMA), a break above could take it near 1.3500. On the downside, support is seen at 1.3319 (Dec 7 Low), a break below targets 1.3300. Against the euro, the pound was trading flat at 88.23 pence, having hit a high of 86.89 pence on Friday, it’s highest since Jun. 9.
AUD/USD: The Australian dollar rose, extending previous session gains, despite data released earlier showing Australia's house price index dropped 0.20 percent q/q in the third quarter versus expected print of 0.5 percent. The Aussie trades 0.1 percent up at 0.7535, having hit a low of 0.7501 on Friday; it’s lowest since Jun. 7. FxWirePro's Hourly Aussie Strength Index stood at 116.46 (Highly Bullish) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7501 (Dec. 8 Low), a break below targets 0.7457 (Jun. 6 Low). On the upside, resistance is located at 0.7564 (10-DMA), a break above could take it near 0.7581 (21-DMA).
NZD/USD: The New Zealand dollar rallied to a 2-week high after the government appointed national pension fund chief Adrian Orr as the new governor for the Reserve Bank of New Zealand for a five-year term, starting March 2018. The Kiwi trades 0.3 percent up at 0.6930, having touched a high of 0.6936 earlier, its highest level since Nov. 28. FxWirePro's Hourly Kiwi Strength Index was at 31.97 (Neutral) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6945 (Nov. 28 High), a break above could take it near 0.6979 (Nov. 9 High). On the downside, support is seen at 0.6901 (Session Low), a break below could drag it lower 0.6869 (10-DMA).
Equities Recap
Asian shares steadied after three straight sessions of gains, while markets consolidated as investors refrained from taking big positions ahead of Federal Reserve's policy meeting outcome.
MSCI's broadest index of Asia-Pacific shares outside Japan reversed early session gains.
Tokyo's Nikkei declined 0.4 percent to 22,860.13 points, Australia's S&P/ASX 200 index rallied 0.3 percent to 6,016.20 points and South Korea's KOSPI fell 0.5 percent to 2,459.45 points.
Shanghai composite index eased 0.7 percent to 3,298.18 points, while CSI300 index was trading 0.7 percent down at 4,041.18 points.
Hong Kong’s Hang Seng was trading 0.4 percent higher at 28,864.24 points. Taiwan shares shed 0.3 percent to 10,443.28 points.
Commodities Recap
Brent crude oil prices rallied above $65 per barrel for the first time since 2015 after the shutdown of the Forties North Sea pipeline drained out significant supply from the market. International benchmark Brent crude was trading 1.01 percent up at $65.32 per barrel by 0436 GMT, having hit a high of $65.37 earlier, its highest since Jun. 2016. U.S. West Texas Intermediate was trading 0.5 percent higher at $58.28 a barrel, after rising as high as $58.33, its highest since Dec. 1.
Gold prices steadied declining to a 4-1/2 month low in the previous session, ahead of the start of a two-day Federal Reserve meeting in the United States. Spot gold was 0.2 percent up at $1,244.28 an ounce by 0450 GMT, after hitting its lowest since July 20 at $1,240.70 the day before. U.S. gold futures were 0.2 percent lower at $1,244.40.
Treasuries Recap
The 10-year U.S Treasury yield stood at 2.379 percent lower by 0.005 bps, while 5-year yield was 0.005 bps down at 2.151 percent.
The Japanese government bonds traded nearly flat as investors awaited the 1.0 trillion yen 20-year JGBs auction scheduled for Thursday along with FOMC last policy decision for this year. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, trade nearly flat at 0.051 percent, the yield on long-term 40-year remained steady at 0.979 percent and the yield on short-term 2-year rose a nearly ½ basis point to -0.143 percent.
The Australian government bonds traded narrowly mixed as investors remain remained sidelined in any major deal ahead of the Reserve Bank of Australia (RBA) Governor Philip Lowe speech. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 1 basis point to 2.554 percent, the yield on the long-term 30-year note traded nearly flat at 3.297 percent and the yield on short-term 2-year surged 1/2 basis point to 1.837 percent.
The Canadian government bond prices were lower across much of a flatter yield curve, with the two-year down 1.5 Canadian cents to yield 1.512 percent and the 10-year falling 1 Canadian cent to yield 1.862 percent. The gap between Canada's two-year yield and its U.S. equivalent widened by 1.5 basis points to a spread of -31.1 basis points.
