Market Roundup
- Oil rises as Saudi Arabia pushes supply cut
- RBA leaves rate unchanged at 0.75%
- Trump announces tariffs on metal imports from Brazil and Argentina
Economic Data Ahead
- (0230 ET/0730 GMT) Switzerland consumer price index
- (0300 ET/0800 GMT) Spain unemployment change
- (0430 ET/0930 GMT) UK Markit construction PMI
- (0500 ET/1000 GMT) EZ producer price index
Key Events Ahead
- (1230 ET/1730 GMT) ECB's Benoit Coeure gives a speech
FX Beat
DXY: The dollar index steadied near a 1-1/2 week low hit in the prior session on data that showed U.S. factory activity contracted for a fourth straight month in November as new orders slumped back to around their lowest level since 2012, while construction spending fell in October. The greenback against a basket of currencies traded flat at 97.91, having touched a low of 97.81 on Monday, its lowest since November 21.
EUR/USD: The euro eased after rising to a 1-1/2 week peak in the previous session as a new leadership of the Social Democrats threatened the ruling German coalition. The European currency traded 0.05 percent down at 1.1072, having touched a high of 1.1090 on Monday, its highest since November 21. Investors’ attention will remain on a series of data from the eurozone economies, EZ producer price index and ECB Benoît Cœuré's speech, ahead of the U.S. ISM-NY business conditions. Immediate resistance is located at 1.1097, a break above targets 1.1123. On the downside, support is seen at 1.1052, a break below could drag it below 1.1036 (10-DMA).
USD/JPY: The dollar steadied after falling to a near 1-week low in the previous session on news that U.S. President Donald Trump announced tariffs on metal imports from Brazil and Argentina. The major was trading 0.2 percent up at 109.17, having hit a high of 109.72 on Monday, its highest since May 30. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. ISM-NY business conditions. Immediate resistance is located at 109.30 (5-DMA), a break above targets 109.83. On the downside, support is seen at 108.81, a break below could take it near at 108.51.
GBP/USD: Sterling surged, extending gains for the third straight session, after an opinion poll by ICM for Reuters showed British Prime Minister Boris Johnson’s Conservative Party held its 7-point lead over the opposition Labour Party. The major traded up at 1.2940, having hit a high of 1.2951 on Thursday, it’s highest since November 21. Investors’ attention will remain on the development surrounding the general elections, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2951, a break above could take it near 1.2970. On the downside, support is seen at 1.2911 (5-DMA), a break below targets 1.2881 (21-DMA). Against the euro, the pound was trading 0.1 percent down at 85.56 pence, having hit a high of 84.99 on Thursday, it’s highest since May 8.
AUD/USD: The Australian dollar rallied to a 3-week peak after the Reserve Bank of Australia at its monetary policy meeting maintained its official cash rate at a record low of 0.75 percent, as widely expected. Investors now await domestic gross domestic product due tomorrow, which are expected to show a rise of 0.5 percent in the third quarter. The Aussie trades 0.4 percent up at 0.6843, having hit a low of 0.6754 on Friday, it’s lowest since October 17. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.6803, a break below targets 0.6782. On the upside, resistance is located at 0.6857, a break above could take it near 0.6871.
NZD/USD: The New Zealand dollar advanced to a near 4-month peak, supported by some surprisingly soft U.S. economic data. Moreover, the major was also supported by comments from a senior adviser to U.S. President Donald Trump, stating that a U.S.-China trade deal was still possible before the end of the year. The Kiwi trades 0.1 percent up at 0.6510, having touched a high of 0.6513 earlier, its highest level since August 7. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6537, a break above could take it near 0.6562. On the downside, support is seen at 0.6480, a break below could drag it below 0.6437.
Equities Recap
Asian shares slumped after U.S. President Donald Trump surprised markets with tariffs against Brazil and Argentina, stoking fears about global trade tensions.
MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.2 percent.
Tokyo's Nikkei declined 0.6 percent to 23,379.81 points, Australia's S&P/ASX 200 index plunged 2.2 percent to 6,712.30 points and South Korea's KOSPI fell 0.3 percent to 2,085.11 points.
Shanghai composite index rose 0.05 percent to 2,877.07 points, while CSI 300 index traded 0.2 percent up at 3,842.54 points.
Hong Kong’s Hang Seng traded 0.3 percent lower at 26,370.11 points. Taiwan shares added 0.3 percent to 11,531.58 points
Commodities Recap
Crude oil prices rose, extending previous session gains, after Saudi Arabia, the de facto OPEC leader, pushed producers to deepen a supply cut agreement when suppliers meet this week, potentially lowering supply in 2020. International benchmark Brent crude was trading 0.1 percent up at $61.02 per barrel by 0448 GMT, having hit a low of $60.34 on Friday, its lowest since November 20. U.S. West Texas Intermediate was trading 0.3 percent up at $55.22 a barrel, after falling as low as $55.01 on Friday, its lowest since November 20.
Gold prices eased, hovering away from a 1-week high hit last week, after U.S. President Donald Trump's move to impose tariffs on Brazil and Argentina stoked fresh concerns around global trade. Spot gold declined 0.1 percent to $1,460.76 per ounce by 0452 GMT, having touched a high of $1466.44 on Friday, its highest since Nov. 22. U.S. gold futures were unchanged at $1,469.20.
Treasuries Recap
The Australian 3-year futures eased 6 ticks to 99.250 and away from last week's top at 99.395. The 10-year contract lost 6.5 ticks to 98.8400, implying a yield of 1.16 percent.
