Market Roundup
• French 12-Month BTF Auction-0.602%, -0.692% previous
• French 3-Month BTF Auction -0.620%,-0.743% previous
• French 6-Month BTF Auction -0.605%,-0.719% previous
• Canada Dec Manufacturing PMI 57.9, 55.8 previous
• US Dec Manufacturing PMI 57.1, 56.5 previous
• US Nov Construction Spending (MoM) 0.9%, 1.0% forecast, 1.3% previous
• US 3-Month Bill Auction0.090%, 0.095% previous
• US 6-Month Bill Auction 0.090%,0.100% previous
• Brazil Dec Dec Trade Balance -0.04B, 0.20B forecast, 3.73B previous
Looking Ahead – Economic Data (GMT)
• 05:20 Japan Monetary Base (YoY) 16.5% previous
•05:30 US Total Vehicle Sales 15.55M previous
•06:00 New Zealand ANZ Job Advertisements (MoM) 13.9% previous
Looking Ahead - Economic events and other releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro strengthened against dollar on Monday as hopes the rollout of vaccines would ultimately lift a global economy boosted euro. With the lag between a full vaccine rollout and a global economic recovery, investors will count on central banks to keep money cheap. On the data front, German factories churned out more goods in December despite a stricter lockdown to head off a spike in coronavirus deaths in Europe’s largest economy, a survey showed on Monday.IHS Markit’s final Purchasing Managers’ Index (PMI) for manufacturing, which accounts for about a fifth of the German economy, rose to 58.3 from 57.8 the previous month. Immediate resistance can be seen at 1.2303 (23.6%fib), an upside break can trigger rise towards 1.2325 (Higher BB).On the downside, immediate support is seen at 1.2210 (38.2%fib), a break below could take the pair towards 1.2177 (21DMA).
GBP/USD: Sterling dipped against dollar on Monday as warnings of tighter UK lockdown measures outweighed the relief over the last-minute Brexit trade deal.Sterling initially strengthened against the dollar, even briefly breaking above $1.37 for the first time since 2018 in early London trading, but gave up ground. The pound had strengthened against both the dollar and euro after the Dec. 24 Brexit trade deal, which set rules for fishing, agriculture and other industries. Immediate resistance can be seen at 1.3700 (100 DMA), an upside break can trigger rise towards 1.3759 (Higher BB).On the downside, immediate support is seen at 1.3640 (38.2%fib), a break below could take the pair towards 1.3597 (Psychological level).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Monday, reversing from a near three-year high earlier in the day, as the uncertain outcome of U.S. Senate runoff elections in Georgia this week spooked investors. Canadian factory activity expanded at its fastest pace on record in December as new orders and production climbed. The HIS Markit Canada Manufacturing Purchasing Managers' index (PMI) rose to a seasonally adjusted 57.9 in December from 55.8 in November. The loonie was trading down 0.4% at 1.2772 to the greenback, or 78.30 U.S. cents. The currency touched its strongest intraday level since April 2018 at 1.2665 before turning lower. It notched a 2% gain in the year just ended .Immediate resistance can be seen at 1.2831 (38.2%fib), an upside break can trigger rise towards 1.2916 (Higher BB).On the downside, immediate support is seen at 1.2677 (23.6%fib), a break below could take the pair towards 1.2662 (Lower BB).
USD/JPY: The dollar declined against the Japanese yen on Monday as reports of a possible tightening in coronavirus emergency rules for Tokyo boosted safe-haven yen. The Japanese government said on Monday it was considering declaring a state of emergency in and around Tokyo as coronavirus cases climb, casting fresh doubt over whether it can push ahead with the summer Olympics and keep economic damage to a minimum. Tokyo and the three surrounding prefectures, which have requested an emergency declaration, asked residents to refrain from non-essential, non-urgent outings after 8 p.m. from Friday .Strong resistance can be seen at 102.97 (38.2%fib), an upside break can trigger rise towards 103.10 (50%fib).On the downside, immediate support is seen at 102.79(23.6%fib), a break below could take the pair towards 102.61 (Lower BB).
Equities Recap
European shares rallied in the first trading session of the year on Monday, as a landmark Brexit trade deal and coronavirus vaccination campaigns across the continent bolstered expectations of a strong economic rebound.
UK's benchmark FTSE 100 closed up by 1.72 percent, Germany's Dax ended up by 1.72percent, France’s CAC finished the day down by1.31 percent.
Shares on Wall Street closed sharply lower on Monday, sliding from all-time peaks on the first trading day of the year, as risk appetite ebbed amid upcoming runoff elections in Georgia and the persistent surge in coronavirus cases.
Dow Jones closed down by 1.25% percent, S&P 500 closed up by 1.48% percent, Nasdaq settled up by 1.47% percent.
Treasuries Recap
U.S. Treasury yields backpedaled from earlier gains on Monday as stock indexes tumbled on nervousness over an election this week that will determine control of the U.S. Senate, while traders pushed inflation expectations over the next 10 years to their highest average since 2018.
The benchmark 10-year yield was last up less than a basis point at 0.9165%.
Commodities Recap
Oil prices slipped from multi-month highs to end more than 1% lower on the first trading day of the year after OPEC+ failed to decide on Monday whether to increase output in February and agreed to meet again on Tuesday.
Brent futures settled 71 cents, or 1.4%, lower at $51.09 a barrel, while U.S. West Texas Intermediate (WTI) crude fell 90 cents, or 1.9%, to settle at $47.62.
Gold began the new year by climbing 2% on Monday, closing in on its highest in nearly two months as the dollar slid to 2018 lows and prospects of tougher restrictions to combat a new variant of the coronavirus kept safe-haven bullion in demand.
Spot gold was up 1.7% at $1,930.20 an ounce by 1255 GMT, having risen as much as 2% to its highest since Nov. 9 at $1,936.31. U.S. gold futures advanced by 2.1% to $1,935.60.
