Market Roundup
• US Dec Core PPI (MoM) 0.1%,0.2% forecast, -0.2% previous
• US Dec Core PPI (YoY) 1.1%,1.3% forecast, 1.3% previous
• US Jan NY Empire State Manufacturing Index 4.80, 3.55 forecast, 3.50 previous
• US Dec PPI (MoM) 0.1% , 0.2% forecast, 0% previous
• US Crude Oil Inventories -2.549M, -0.474M forecast, 1.164M previous
• US Gasoline Inventories 6.678M, 3.386M forecast, 9.137M previous
• Brazil Foreign Exchange Flows1.110B,, -9.491B previous
Looking Ahead - Economic Data (GMT)
• 21:45 New Zealand Dec Electronic Card Retail Sales (MoM) -0.2%,2.6% previous
• 21:45 New Zealand Electronic Dec Card Retail Sales (YoY) 2.1%, 5.1% previous
• 23:00 Japan Jan Reuters Tankan Index -6 previous
• 23:30 Japan Core Machinery Orders (MoM) 3.2%, -6.0% previous
• 23:30 Japan Nov Core Machinery Orders (YoY) -5.4%,-6.1% previous
• 23:30 Japan Dec PPI (MoM) 0.2%, 0.2% previous
• 00:30 Australia Home Loans (MoM) 0.4%,0.6% previous
• 00:30 Australia Invest Housing Finance (MoM) 1.1% previous
• China Dec House Prices (YoY) 7.1% previous
• China Dec M2 Money Stock (YoY) 8.3% forecast, 8.2% previous
Looking Ahead - Events, Other Releases (GMT)
• No significant events
Currencies Summaries
EUR/USD: The euro strengthened against the U.S. dollar on Wednesday, after the United States and China signed a deal to de-escalate their trade war. The two countries announced an initial trade deal on Wednesday that will roll back some tariffs and boost Chinese purchases of U.S. goods and services, defusing an 18-month conflict between the world's two largest economies. The euro was up 0.20 percent at $1.1150. An index that tracks the dollar versus a basket of six major currencies was down 0.16 at 97.23. Immediate resistance can be seen at 1.1163 (Daily High), an upside break can trigger rise towards 1.1217 (Higher BB).On the downside, immediate support is seen at 1.1102 (Jan 14th low), a break below could take the pair towards 1.1055 (Lower BB).
GBP/USD: Sterling declined against dollar Wednesday, before recovering some ground as investors scaled back expectations for further monetary easing at the next Bank of England policy meeting on Jan. 30. Sterling was last trading up 0.1% at $1.3023, having weakened to as low as $1.2955 earlier, bringing its year-to-date losses to almost 2%. Immediate resistance can be seen at 1.3067 (9 DMA), an upside break can trigger rise towards 1.3098 (11 DMA).On the downside, immediate support is seen at 1.2901 (Lower BB), a break below could take the pair towards 1.2832 (Nov 27th low).
USD/CAD: The Canadian dollar was little changed against the greenback on Wednesday as domestic data showed a drop in home sales and investors assessed the merit of a trade deal between the United States and China. Canadian home sales fell 0.9% in December from the previous month, breaking a streak of monthly gains that began last March, the Canadian Real Estate Association said. At (2029 GMT), the Canadian dollar was trading nearly unchanged at 1.3050 to the greenback . The currency, which last Thursday hit a near two-week low at 1.3104, traded in a range of 1.3057 to 1.3078. Immediate resistance can be seen at 1.3076 (Daily High), an upside break can trigger rise towards 1.3100 (Psychological level).On the downside, immediate support is seen at 1.3025 (5 DMA), a break below could take the pair towards 1.3000 (Psychological level).
USD/JPY: The dollar declined against the Japanese yen on Wednesday, as signing of a preliminary U.S.-China trade deal increased demand for safe haven yen. The U.S.-China Phase 1 agreement, due to be signed at the White House on Wednesday, marks the first step toward ending a damaging 18-month trade dispute between the world’s two largest economies. Beijing and Washington touted the “Phase 1” agreement as a step forward after months of start-stop talks, and investors greeted the news with relief. Strong resistance can be seen at 110.22 (Higher BB), an upside break can trigger rise towards 110.11 (May 22nd High).On the downside, immediate support is seen at 109.30 (5 DMA), a break below could take the pair towards 108.93 (11 DMA).
Equities Recap
European shares ended flat on Wednesday as investors held back from making any big bets ahead of the signing of a Phase 1 trade deal between the United States and China.
UK's benchmark FTSE 100 closed up by 0.28 percent, Germany's Dax ended down by 0.18 percent, France’s CAC finished the day down by 0.14 percent.
U.S. stocks came off their session highs on Wednesday after the United States and China signed a long-awaited Phase 1 trade deal that will roll back some tariffs and boost Chinese purchases of U.S. goods and services.
Dow Jones closed up by 0.30 percent, S&P 500 ended up by 0.12 percent, Nasdaq finished up by 0.01 percent.
Treasuries Recap
U.S. Treasury yields declined on Wednesday as investors repositioned around new data showing producer prices barely rose in December. The benchmark 10-year yield was down 3.5 basis points in morning trading to 1.783%.
Commodities Recap
Oil prices were down slightly on Wednesday, pressured early by data showing big increases in U.S. refined products but recovered some of the losses later by the signing of a Phase 1 trade deal between Washington and Beijing.
Brent futures lost 49 cents, or 0.8%, to settle at $64 a barrel, while U.S. West Texas Intermediate (WTI) crude ended 42 cents, or 0.7%, lower at $57.81.
Gold prices gained on Wednesday on hopes a U.S.-China trade deal will reduce tensions.
Spot gold rose 0.3% to $1,551.40 per ounce as of 1101 GMT, having slipped to a more than one week low of $1,535.63 in the previous session. U.S. gold futures gained 0.5% to $1,552.20.
