Market Roundup
• Canada Labor Reserve Assets Total (Nov): 122.6B, 123.1B previous
• Canada Labor Productivity (QoQ) (Q3): -0.4%, 0.2% forecast, -0.1% previous
• US S&P Global Composite PMI (Nov): 54.9, 55.3 forecast, 54.1 previous
• US Services PMI (Nov): 56.1, 57.0 forecast, 55.0 previous
• US All Car Sales (Nov): 2.96M, 3.04M previous
• US All Truck Sales (Nov): 13.54M, 13.21M previous
• US Durables Excluding Defense (MoM) (Oct): 0.5%, 0.4% forecast, 0.4% previous
• US Durables Excluding Transport (MoM) (Oct): 0.2%, 0.1% previous
• US Factory Orders (MoM) (Oct): 0.2%, 0.3% forecast, -0.2% previous
• US Factory Orders Ex Transportation (MoM) (Oct): 0.1%, 0.1% previous
• US ISM Non-Manufacturing Business Activity (Nov): 53.7, 57.2 previous
• US ISM Non-Manufacturing Employment (Nov): 51.5, 53.0 previous
• US ISM Non-Manufacturing New Orders (Nov): 53.7, 56.6 previous
• US ISM Non-Manufacturing PMI (Nov): 52.1, 55.5 forecast, 56.0 previous
• US ISM Non-Manufacturing Prices (Nov): 58.2, 56.4 previous
• US Crude Oil Inventories: -5.073M, -1.600M forecast, -1.844M previous
Looking Ahead Economic Data(GMT)
•23:00 Japan Reuters Tankan Index (Dec): 5 previous
•23:50 Japan Foreign Bonds Buying: -773.7B previous
•23:50 Japan Foreign Investments in Japanese Stocks: -446.0B previous
•00:30 Australia Exports (MoM) (Oct): -4.3% previous
•00:30 Australia Imports (MoM) (Oct): -3.1% previous
•00:30 Australia Trade Balance (Oct): 4.580B forecast, 4.609B previous
Looking Ahead Events And Other Releases (GMT)
• 01:30 BoJ Board Member Nakamura Speaks
Currency Summaries
EUR/USD: The euro initially gained but gave up ground on Wednesday after French Government overthrown in no-confidence vote.French opposition lawmakers brought the government down on Wednesday, throwing the European Union's second-biggest economic power deeper into a political crisis that threatens its capacity to legislate and rein in a massive budget deficit.Far-right and left-wing lawmakers joined forces to back a no-confidence motion against Prime Minister Michel Barnier and his government, with a majority 331 votes in support of the motion. No French government had lost a confidence vote since Georges Pompidou's in 1962. This time, Macron had ushered in the crisis by calling a snap election in June that delivered a polarised parliament. Immediate resistance can be seen at 1.0511(SMA 9), an upside break can trigger rise towards 1.0568(38.2%fib).On the downside, immediate support is seen at 1.0478(23.6%fib), a break below could take the pair towards 1.0358(Lower BB).
GBP/USD: The pound strengthened on Wednesday as US economic data did not shake expectations of an interest rate cut later this month.U.S. private payrolls increased at a moderate pace in November, although it came below expectations, while annual wages for workers staying in their jobs edged up for the first time in 25 months. Private payrolls rose by 146,000 jobs last month after advancing by a downwardly revised 184,000 in October, the ADP report showed. At the same time, the U.S. services sector activity slowed in November after posting big gains in recent months. The Institute for Supply Management's nonmanufacturing purchasing managers index slipped to 52.1 last month after surging to 56.0 in October. U.S. fed funds futures raised the chances of a 25 basis point cut this month to 76%, from about 73% late Tuesday, while reducing the odds of a pause in easing to 24% from 27% the day before, according to the CME's FedWatch tool. Immediate resistance can be seen at 1.2735(50%fib), an upside break can trigger rise towards 1.2789 (SMA 30).On the downside, immediate support is seen at 1.2629(38.2%fib), a break below could take the pair towards 1.2507(23.6%fib).
USD/CAD: The Canadian dollar edged higher against its U.S. counterpart on Wednesday after US data showed a cooling jobs market in the U.S. The ADP payrolls estimate and ISM services index for November were below market forecasts. U.S. job openings increased solidly in October while layoffs dropped by the most in 1-1/2 years, data showed on Tuesday, suggesting the labour market is slowing, even as another survey showed employers were hesitant to hire more workers. The data came ahead of a speech by Fed Chair Jerome Powell, who said that the U.S. economy is in good shape and that there is no reason that can't continue.Powell said that the Fed was on a path to more neutral rates over time. However, he said downside risks are less than thought and that the U.S. central bank can afford to be cautious in finding neutral. The loonie was trading 0.01% higher at C$1.4064 to the greenback, after trading in a range of 1.4053 to 1.4083. Immediate resistance can be seen at 1.4083(23.6% fib), an upside break can trigger rise towards 1.4121 (Higher BB).On the downside, immediate support is seen at 1.4000 (Psychological level), a break below could take the pair towards 1.3982(38.2%fib).
USD/JPY:The U.S. dollar strengthened against the yen on Wednesday after media reports cast doubt on market expectations that the Bank of Japan (BOJ) will raise interest rates this month. Analysts pointed to indications that the BOJ may hold off on a rate hike at its upcoming monetary policy meeting on December 18-19. While BOJ Governor Kazuo Ueda had previously hinted that the timing for a rate hike was approaching, recent reports suggested the central bank might take a more cautious approach at its December meeting. As a result, market expectations for a rate hike in December dropped to 42%, down from over 60% earlier in the week. This uncertainty surrounding the BOJ’s policy stance weighed on the yen. Immediate resistance can be seen at 150.89 (38.2%fib) an upside break can trigger rise towards 152.77 (23.6%fib). On the downside, immediate support is seen at 149.64(50%fib) a break below could take the pair towards 147.98(61.8%fib).
Equities Recap
European markets closed at a fresh one-month high on Wednesday, with German stocks leading the rally, finishing above the 20,000 mark while,investor focus also shifted to France, where a no-confidence vote in parliament threatened to oust Prime Minister Michel Barnier's government.
UK's benchmark FTSE 100 closed down by 0.28 percent, Germany's Dax closed up by 1.00 percent, France’s CAC closed up by 0.66 percent.
Wall Street's major stock indices gained, with traders appearing more focused on the outlook for lower domestic interest rates.
At (GMT20:18) Dow Jones was up by 0.68%percent, S&P 500 was up by 0.58% percent, Nasdaq was up by 1.22% percent.
Commodities Recap
Gold inched higher on Wednesday following data that showed U.S. private payrolls grew at a moderate pace last month while, investors also digested remarks from Federal Reserve Chair Jerome Powell.
Spot gold was up 0.4% at $2,654.03 an ounce by 02:15 p.m. ET (1915 GMT). U.S. gold futures settled 0.3% higher at $2,676.20.
Oil futures fell nearly 2% on Wednesday as investors awaited an imminent OPEC+ decision on production cuts. However, a larger-than-expected draw in U.S. crude stockpiles last week provided some support to prices, tempering the downward pressure.
Brent crude futures fell $1.31, or 1.78%, to settle at $72.31 a barrel. U.S. West Texas Intermediate crude futures fell $1.40, or 2%, to $68.54.
