Market Roundup
- Chinese imports fell 6.4% from a year ago in October
- Chinese exports fell 0.9% from a year ago in October
- Gold hovers near 1-month low on U.S.-China trade deal hopes
- Oil declines on rising U.S. stockpiles
Economic Data Ahead
- (0200 ET/0700 GMT) German trade balance
- (0200 ET/0700 GMT) German current balance
- (0245 ET/0745 GMT) France trade balance
- (0245 ET/0745 GMT) France current balance
- (0245 ET/0745 GMT) France industrial output
- (0245 ET/0745 GMT) France nonfarm payroll
Key Events Ahead
- No significant event scheduled
FX Beat
DXY: The dollar index held firm near a 3-week peak after data released yesterday showed the number of Americans filing applications for unemployment benefits fell more than expected last week, consistent with strong labor market conditions and continued job growth. The greenback against a basket of currencies traded flat at 98.14, having touched a high of 98.23 on Thursday, its highest since October 16.
EUR/USD: The euro consolidated near a 3-week low hit in the previous session, after the European Commission forecast that the eurozone economy is likely to grow slower than earlier expected this year and next, due to global trade conflicts, geopolitical tensions and Brexit. The European currency traded flat at 1.1049, having touched a low of 1.1036 on Thursday, its lowest since October 16. Investors’ attention will remain on a series of data from the Eurozone economies, ahead of the U.S. economic data, including wholesale inventories, Michigan prelim consumer sentiment index and Fed Brainard's speech. Immediate resistance is located at 1.1096 (5-DMA), a break above targets 1.1123. On the downside, support is seen at 1.1022, a break below could drag it below 1.1002.
USD/JPY: The euro steadied after rising to an over 5-month peak in the previous session as risk sentiment improved on news China and the United States have agreed to roll back tariffs on each others’ goods in a phase one trade deal if it is completed. The major was trading flat at 109.23, having hit a high of 109.48 on Thursday, its highest since May 31. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. wholesale inventories, Michigan prelim consumer sentiment index and Fed Brainard's speech. Immediate resistance is located at 109.62 (May 31 High), a break above targets 109.92 (May 30 High). On the downside, support is seen at 108.82 (5-DMA), a break below could take it near at 108.45.
GBP/USD: Sterling held near 2-week low after two Bank of England policymakers unexpectedly voted to cut interest rates on Thursday due to uncertainties posed by Britain’s exit from the European Union. The major traded flat at 1.2812, having hit a low of 1.2794 on Thursday, it’s lowest since October 24. Investors’ attention will remain on the development surrounding Brexit, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2874 (10-DMA), a break above could take it near 1.2949 (October 24 High). On the downside, support is seen at 1.2748, a break below targets 1.2700. Against the euro, the pound was trading flat at 86.21 pence, having hit a high of 85.85 on Tuesday, it’s highest since October 22.
AUD/USD: The Australian dollar declined, reversing most of its previous session gains after data showed China’s exports and imports fell less than expected in October. Chinese exports fell 0.9 percent, while imports fell 6.4 percent from a year ago in October, against expectations of 3.9 percent drop in exports and imports to fall 8.9 percent from a year earlier. However, the downside appears limited as trade balance for October was $42.81 billion, compared to forecasts of $40.83 billion. The Aussie trades 0.3 percent down at 0.6879, having hit a low of 0.6861 on Thursday, it’s lowest since October 30. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.6848, a break below targets 0.6821. On the upside, resistance is located at 0.6930, a break above could take it near 0.6948.
NZD/USD: The New Zealand dollar eased, extending losses for the fifth straight session, as dismal employment numbers bolstered bets that the Reserve Bank of New Zealand would cut rates next week. Data released on Tuesday showed, domestic seasonally adjusted unemployment rate rose to 4.2 percent in the September quarter, up from 3.9 percent last quarter. The Kiwi trades 0.1 percent down at 0.6360, having touched a low of 0.6341 on Thursday, its lowest level since October 30. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6396, a break above could take it near 0.6431. On the downside, support is seen at 0.6333, a break below could drag it below 0.6300.
Equities Recap
Asian shares declined from 6-month highs amid uncertainty over whether and when the United States and China will seal a deal marking a truce in their trade war.
MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.2 percent.
Tokyo's Nikkei rose 0.05 percent to 23,345.20 points, Australia's S&P/ASX 200 index declined 0.05 percent to 6,724.10 points and South Korea's KOSPI eased 0.4 percent to 2,136.84 points.
Shanghai composite index rose 0.05 percent to 2,980.83 points, while CSI 300 index traded 0.1 percent up at 3,995.92 points.
Hong Kong’s Hang Seng traded 0.6 percent lower at 27,670.66 points. Taiwan shares shed 0.2 percent to 11,586.36 points.
Commodities Recap
Crude oil prices declined amid fading hopes that a deal to end the lingering trade war between Washington and Beijing would be signed any time soon. International benchmark Brent crude was trading 0.3 percent down at $62.12 per barrel by 0446 GMT, having hit a high of $63.28 on Wednesday, its highest since September 24. U.S. West Texas Intermediate was trading 0.3 percent down at $56.87 a barrel, after rising as high as $57.84 on Thursday, its highest since September 24.
Gold prices steadied after falling to a near 1-month low in the previous session after China and the United States agreed to roll back tariffs as part of the first phase of a trade deal. Spot gold was trading flat at $1,468.99 per ounce by 0449 GMT, having touched a low of $1,460.48 on Thursday, its lowest since Oct. 1. U.S. gold futures were up 0.2 percent at $1,469.60 per ounce.
Treasuries Recap
The Australian government bonds during Asian session of the last trading day of the week after risk sentiments were lifted, following trade deal optimism amid ongoing Brexit uncertainties. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, jumped 8-1/2 basis points to 1.296 percent, the yield on the long-term 30-year bond surged 8 basis points to 1.878 percent and the yield on short-term 2-year gained 2 basis points to 0.893 percent.
