Market Roundup
• Brexit in turmoil as UK PM May pulls vote on her EU divorce deal.
• EU's Tusk says Brexit deal not up for renegotiation, will hold talks.
• Pound tumbles to 20-month low after Britain's May aborts Brexit vote.
• US Nov Employment Trends, 110.4, 110.7 previous.
• US Oct JOLTS Job Openings, 7.079 mln, 6.995 mln forecast, 7.009 mln previous, 6.960 mln revised.
• France's Macron says has asked government to increase wages by 100 euros per month from January.
• Macron says won't reinstate the wealth tax, will fight tax fraud.
• EU warns Italy time running out to avoid procedure over budget .
• CA Nov House Starts, Annualized, 215.9k, 198.0k forecast, 205.9k previous, 206.8k revised.
• CA Oct Building Permits MM, -0.2%, -0.3% forecast, 0.4% previous.
• Oil falls nearly 2% on stocks sell-off, pares OPEC deal gains.
Looking Ahead - Economic Data (GMT)
• Dec 10 21:45 New Zealand Nov Electronic Card Retail Sales mth, 0.1% previous
• Dec 10 21:45 New Zealand Nov Elec Card Retail Sales YY, 6.2% previous
• Dec 10 23:50 Japan Oct Business Survey Index, 6.5% previous
• Dec 11 00:30 Australia Nov NAB Business Conditions, 12 previous
• Dec 11 00:30 Australia Nov NAB Business Confidence, 4 previous
• Dec 11 00:30 Australia Q3 Home Price Index, -1.5% forecast, -0.7% previous
Looking Ahead - Events, Other Releases (GMT)
• Dec 11 08:30 ECB Vice President Luis de Guindos speaks at the European Statistical Forum in Frankfurt
• Dec 11 13:00 Bank of Slovenia Deputy Governor Primoz Dolenc and head of IMF mission to Slovenia Bernardin Akitoby speak at the presser in Ljubljana
• Dec 11 09:30 BoE publishes Record of the Financial Policy Committee meeting held on November 28, 2018
Currency Summaries
EUR/USD is likely to find support at 1.1302 levels and currently trading at 1.1392 levels. The pair has made session high at 1.1445 and hit lows at 1.1392 levels. The euro declined against US dollar on Monday as greenback rebounded after posting its biggest weekly drop in more than three months last week on Brexit worries. The U.K. parliamentary vote for May's Brexit proposal was set for Tuesday. The postponed vote left the door open to a disorderly Brexit with no deal, a last-minute deal or another EU referendum. European Council President Donald Tusk said the Brexit Brussels and May agreed on are not up for renegotiation. Safe-haven bids stoked a comeback for the greenback which suffered its steepest weekly drop versus a basket of currencies in three months last week. The dollar's snapback was limited as traders reduced their expectations that the Federal Reserve might pause its interest rate hikes sooner than previously thought. The euro was last trading down 0.23 percent at $1.1351 after hitting a near 2-1/2-week high at $1.1442 in Asian trading.
GBP/USD is supported in the range of 1.2500 levels and currently trading at 1.2555 levels. It reached session high at 1.2556 and dropped to session low at 1.2502 levels. Britain's pound declined sharply against the dollar on Monday after Prime Minister Theresa May pulled a parliamentary vote on her Brexit deal with the European Union, panicking investors about deepening political uncertainty in Britain. May said on Monday she was delaying the planned vote as her deal would likely be rejected "by a significant margin". Colleagues had told May that she faced a rout in the vote that was set for Tuesday. The move thrusts Britain's exit from the European Union into turmoil, with possible options including a disorderly no-deal Brexit, another referendum on EU membership, or a last minute renegotiation of May's deal with Brussels. May said she would do all she could to secure further assurances from the EU on the so-called backstop arrangement, a crucial part of the deal bitterly opposed by many of her fellow conservatives and opposition parties. The pound fell 1.6 percent against the dollar to as low as $1.2502, most of the loss coming after May confirmed she was delaying the vote.
USD/CAD is supported at 1.3290 levels and is trading at 1.3407 levels. It has made session high at 1.3420 and lows at 1.3300 levels. The Canadian dollar weakened against its U.S. counterpart on Monday as stronger dollar across the board and weaker oil prices weighed on loonie. Decline for the loonie came as the U.S. dollar rose against a basket of major currencies and as the British pound lost ground after British Prime Minister Theresa May abruptly decided to pull a parliamentary vote on her Brexit deal.The loonie was paring some of its gains following stellar jobs data on Friday. Canada added a record number of jobs in November and the unemployment rate dipped to a new all-time low, a performance that analysts said should help ease the Bank of Canada's worries about a recent economic slowdown. On Monday, data showed the Canadian Mortgage and Housing Corporation (CMHC) the seasonally adjusted annualized rate of Canadian housing starts increased to 215,941 units from a revised 206,753 units in October. The Canadian dollar was last trading 0.6 percent lower at 1.3409 to the greenback.
USD/JPY is supported around 112.22 levels and currently trading at 113.18 levels. It peaked to hit session high at 113.16 and made session lows at 112.82 levels. The U.S. dollar strengthened against the yen on Monday after Britain's Prime Minister Theresa May postponed a parliamentary vote on her deal to exit the European Union. May's abrupt move less than 30 hours before parliament was to vote opens up a range of possibilities from a Brexit without a deal, a last-minute agreement or another EU referendum. Admitting she faced defeat on Britain's potentially biggest political and economic shift since World War Two, May was laughed at by some lawmakers when she said there was broad support for key aspects of her deal reached with the EU last month. The dollar rebounded after posting its biggest weekly drop in more than three months last week on Brexit worries. The EU reacted coolly, with European Council President Donald Tusk saying it was ready to discuss how to smooth ratification, but that neither the withdrawal agreement nor the Irish backstop would be renegotiated._
Equities Recap
Investors took cover and ditched European shares on Monday as a burst of political risk with a key vote on Brexit being delayed and unrest over the weekend in France added to concerns over global growth and U.S-Chinese trade tensions.
UK's benchmark FTSE 100 closed down by 0.7 percent, the pan-European FTSEurofirst 300 ended the day down by 1.74 percent, Germany's Dax ended down by 1.7 percent, France’s CAC finished the day down by 1.6 percent.
U.S. stocks ended a volatile session slightly higher on Monday, helped by gains in technology shares, though uncertainty over Britain's exit from the European Union kept investors on edge about global growth.
Dow Jones closed up by 0.14 percent, S&P 500 ended up by 0.18 percent, Nasdaq finished the day up by 0.75 percent.
Treasuries Recap
U.S. Treasury yields drifted higher on Monday as Wall Street stocks recovered, but trading was mostly rangebound as investors digested the Brexit turmoil and its impact on other assets after Britain's Prime Minister Theresa May postponed a parliamentary vote on her deal to exit the European Union.
U.S. 10-year note yields were up at 2.853 percent, from 2.85 percent late on Friday. Earlier, they fell to a near four-month low.
U.S. 30-year bond yields, however, fell to 3.127 percent, from 3.143 percent on Friday, after earlier dropping to 3.103 percent, a three-month trough.
Commodities Recap
Gold edged lower on Monday as the dollar firmed against the pound on doubts about Britain's departure from the European Union, but falling equities and prospects of a slower pace of U.S. interest rate hikes in 2019 kept bullion near a five-month peak.
Spot gold was down 0.4 percent at $1,242.89 per ounce at 1:47 p.m. EST (1847 GMT), having touched $1,250.55, its highest level since July 11, early in the session.
U.S. gold futures settled down $3.20, or 0.3 percent, at $1,249.40.
Oil fell nearly 2 percent on Monday, echoing the weakness in global stock markets as the focus returned to demand growth concerns and crude prices erased some of the gains made last week on an OPEC-led decision to cut output.
Brent crude oil futures fell 75 cents to $60.96 a barrel by 11:54 a.m. EST (1654 GMT), while U.S. futures fell 95 cents to $51.66 a barrel.
