Market Roundup
- Eurozone Nov 2018 reserve assets total increase to 700.27 eur vs previous 696.85 eur
- Eurozone Nov 2018 inflation ex-tobacco idx decrease to 104.1 vs previous 104.3
- Eurozone Nov 2018 HICP-x tobacco yy decrease to 1.9 % vs previous 2.1 %
- Eurozone Nov 2018 HICP-x tobacco mm decrease to -0.2 % vs previous 0.2 %
- Eurozone Nov 2018 HICP-x f&e mm decrease to -0.2 % vs previous 0.1 %
- Eurozone Nov 2018 HICP final mm decrease to -0.2 % (forecast -0.2 %) vs previous 0.2 %
- Eurozone Oct 2018 eurostat trade nsa, eur increase to 14 eur vs previous 13.1 eur
- Eurozone Nov 2018 HICP final yy decrease to 1.9 % (forecast 2 %) vs previous 2 %
- Eurozone Nov 2018 HICP-x f,e,a&t final yy stays flat at 1 % (forecast 1 %) vs previous 1 %
- Eurozone Nov 2018 HICP-x f, e, a, t final mm decrease to -0.3 % (forecast -0.2 %) vs previous -0.2 %
- Eurozone Nov 2018 HICP-x f&e final yy stays flat at 1.1 % (forecast 1.1 %) vs previous 1.1 %
- Italy Oct 2018 trade balance eu decrease to 0.744 eur vs previous 1.182 eur (revised from 1.183 eur)
- Italy Oct 2018 global trade balance increase to 3.784 eur vs previous 1.274 eur
Economic Data Ahead
- (0830 ET/1330 GMT) The Federal Reserve Bank of New York is expected to report that Empire State general business conditions index fell to 21.5 in December from 23.30 in November
- (0830 ET/1330 GMT) The Statistics Canada will report foreign portfolio investment in domestic stocks for the month of October.
- (0830 ET/1330 GMT) The Statistics Canada will release investment in foreign securities figures for the month of October.
- (1000 ET/1500 GMT) The National Association of Home Builders (NAHB) is expected to report that the U.S. Housing Market Index remains unchanged at 60 points in December.
Key Events Ahead
● No Significant Events Scheduled
FX Beat
DXY: The dollar index eased as recent disappointing U.S. economic data and worries over Washington's protectionist policies fuelled expectations the Federal Reserve will cut its guidance. The greenback against a basket of currencies trades 0.2 percent down at 97.21, having touched a high of 97.71 on Friday, its highest since June 2017. FxWirePro's Hourly Dollar Strength Index stood at 14.79 (Neutral) by 1000 GMT.
EUR/USD: The euro rebounded from an over 2-week low touched in the previous session after Italy's coalition government agreed on the contents of the budget it will propose to Brussels in an effort to avoid disciplinary action over its plans to hike deficit spending next year. The European currency traded 0.3 percent up at 1.1339, having touched a low of 1.1270 on Friday, its lowest since Nov. 28. FxWirePro's Hourly Euro Strength Index stood at -21.28 (Neutral) by 1000 GMT. Immediate resistance is located at 1.1361 (December 5 High), a break above targets 1.1401 (November 29 High). On the downside, support is seen at 1.1267 (November 28 Low), a break below could drag it till 1.1215 (November 12 Low).
USD/JPY: The dollar declined after a senior International Monetary Fund official stated that trade dispute between China and the United States were already affecting business confidence and investment in Asia. However, downside appears limited as investors awaited cues on U.S. interest rate hikes from a Federal Reserve meeting this week. The major was trading 0.05 percent down at 113.31, having hit a high of 113.70 on Thursday, its highest since December 3. FxWirePro's Hourly Yen Strength Index stood at 129.23 (Highly Bullish) by 1000 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. housing market index and New York empire state manufacturing. Immediate resistance is located at 113.72 (November 30 High), a break above targets 114.03 (November 28 High). On the downside, support is seen at 113.18 (November 29 Low), a break below could take it lower 112.66 (October 23 Low).
GBP/USD: Sterling surged as investors cautiously awaited Prime Minister Theresa May's speech in parliament scheduled later in the day, where she will state her opposition to a second Brexit referendum, as such a vote will do irreparable damage to politics and also break trust with British people. The major traded 0.3 percent up at 1.2623, having hit a low of 1.2476 on Wednesday; it’s lowest since mid-April 2017. FxWirePro's Hourly Sterling Strength Index stood at 24.85 (Neutral) 1000 GMT. Immediate resistance is located at 1.2670 (Dec. 13 High), a break above could take it near 1.2754. On the downside, support is seen at 1.2560, a break below targets 1.2515. Against the euro, the pound was trading 0.05 percent down at 89.83 pence, having hit a low of 90.87 last week, it’s lowest since August 29.
USD/CHF: The Swiss franc bounced back after falling to a 1-week low in the previous session, amid fears of a global economic slowdown and concerns over the broadening impact of the international trade dispute. The major trades 0.3 percent down at 0.9950, having touched a high of 0.9989 on Friday; it’s highest since December 6. FxWirePro's Hourly Swiss Franc Strength Index stood at 14.79 (Neutral) by 1000 GMT. On the higher side, near-term resistance is around 1.0008 (December 5 High) and any break above will take the pair to next level till 1.0050 (November 7 High). The near-term support is around 0.9889 (Dec. 7 Low), and any close below that level will drag it till 0.9847 (Oct. 15 Low).
Equities Recap
European shares slumped, weighed down by losses in retail stocks, while sterling rebounded as investors waited for the next Brexit-related developments.
The pan-European STOXX 600 index plunged 0.3 percent at 346.12 points, while the FTSEurofirst 300 index declined 0.4 percent to 1,366.12 points.
Britain's FTSE 100 trades 0.2 percent down at 6,829.78 points, while mid-cap FTSE 250 fell 0.5 to 17,583.99 points.
Germany's DAX eased 0.05 percent at 10,865.46 points; France's CAC 40 trades 0.3 percent lower at 4,838.26 points.
Commodities Recap
Crude oil prices consolidated within narrow ranges after easing by around 2 percent last week, as concern over the prospects for global economic growth and fuel demand dented investor sentiment. International benchmark Brent crude was trading flat at $60.27 per barrel by 1048 GMT, having hit a high of $63.67 on Dec. 7, its highest since November 22. U.S. West Texas Intermediate was trading 0.9 percent up at $51.68 a barrel, after rising as high as $54.20 on Dec. 7, its highest since the December 5.
Gold prices surged amid concerns of a global economic slowdown, however, upside remained capped as investors awaited cues on U.S. interest rate hikes from a Federal Reserve meeting this week. Spot gold was trading 0.1 percent up at $1,238.70 per ounce at 1050 GMT, having touched a low of $1,232.82 on Friday, its lowest level since Dec. 4. U.S. gold futures rose 0.1 percent at $1,242.1 per ounce.
Treasuries Recap
The U.S. Treasuries remained tad higher during late afternoon session amid a muted trading session that witnessed data of little economic significance. However, all eyes are on the Fed’s announcements on Wednesday. The yield on the benchmark 10-year Treasuries slipped nearly 1 basis point to 2.882 percent, the super-long 30-year bond yields remained tad lower at 3.140 percent and the yield on the short-term 2-year remained 1/2 basis point lower at 2.727 percent.
The German bunds remained narrowly mixed during European session after the Eurozone’s consumer price inflation (CPI) for the month of November disappointed market investors, while the rise in trade balance offset the market pessimism. The German 10-year bond yields, which move inversely to its price, hovered around 0.252 percent, the yield on the 30-year note fell remained tad higher at 0.888 percent and the yield on short-term 2-year slipped 1/2 basis point to -0.611 percent.
The Japanese government bonds gained on the first trading day of the week as investors wait to watch the country’s trade balance data for the month of November, scheduled to be released on November 18 by 23:50GMT. The yield on the benchmark 10-year JGB note, which moves inversely to its price, plunged 7 basis points to 0.033 percent, the yield on the long-term 30-year note suffered by nearly 1-1/2 basis points to 0.771 percent and the yield on short-term 2-year lost nearly 2basis points to -0.148 percent.
The Australian government bonds gained across the curve during Asian session as investors remain cautious amid slowing global economic growth. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, fell 2 basis points to 2.448 percent, the yield on the long-term 30-year bond also dipped 2-1/2 basis points to 2.960 percent and the yield on short-term 2-year down 1 basis point to 1.986 percent.
