Market Roundup
- Japan Q3 GDP (qq), -0.3%, -0.3% forecast, 0.7% previous, 0.8% revised.
- Japan Q3 GDP (qq) Annualised, -1.2%, -1.0% forecast, 3.0% previous.
- Britain agrees Brexit divorce deal with EU, May's opponents vow to thwart it.
- U.S. in China trade talks again, demands 'change of posture'.
- Oil struggles to find footing after 7 pct slump, sentiment stays weak.
- Trump could answer written Russia probe questions this week.
- Italy govt sticks to budget targets despite EU pressure.
- Australia November Consumer Sentiment, 2.8%, 1.0% previous - Westpac-MI.
- Australia Q3 Wage Price Index (qq), 0.6%, 0.6% forecast, 0.6% previous, 0.5% revised.
- Australia Q3 Wage Price Index (yy), 2.3%, 2.3% forecast, 2.1% previous, 2.1% revised.
- China Oct Industrial Output (yy), 5.9%, 5.7% forecast, 5.8% previous.
- China Jan-Oct Urban investment (yy), 5.7%, 5.5% forecast, 5.4% Jan-Sept.
- China Oct Retail Sales (yy), 8.6%, 9.1% forecast, 9.2% previous.
Economic Data Ahead
- (0200 ET/0700 GMT) Germany Q3 GDP Flash (yy) NSA, 1.3% forecast, 2.3% previous.
- (0245 ET/0745 GMT) France Oct CPI (EU Norm) Final (yy), 2.5% forecast, 2.5% previous.
- (0430 ET/0930 GMT) UK Oct Core CPI (yy), 2.0% forecast, 1.9% previous.
- (0430 ET/0930 GMT) UK Oct CPI (yy), 2.5% forecast, 2.4% previous.
- (0430 ET/0930 GMT) UK Oct RPI (yy), 3.4% forecast, 3.3% previous.
- (0430 ET/0930 GMT) UK Oct PPI Input Prices (yy) NSA, 9.6% forecast, 10.3% previous.
- (0430 ET/0930 GMT) UK Oct PPI Output Prices (yy) NSA, 3.1% forecast, 3.1% previous.
- (0430 ET/0930 GMT) UK Oct PPI Core Output (yy) NSA, 2.4% forecast, 2.4% previous.
- (0500 ET/1000 GMT) Euro zone Q3 Employment Flash (yy), 1.4% forecast, 1.5% previous.
- (0500 ET/1000 GMT) Euro zone Q3 GDP Flash Estimate (qq), 0.2% forecast, 0.2% previous.
- (0500 ET/1000 GMT) Euro zone Q3 GDP Flash Estimate (yy), 1.7% forecast, 1.7% previous.
- (0500 ET/1000 GMT) Euro zone Sep Industrial Production (yy), 0.3% forecast, 0.9% previous.
Key Events Ahead
- N/A Bank of England deputy governor Dave Ramsden takes part in an online Q&A on the future of money in London.
- (0200 ET/0700 GMT) Swedish Deputy Central Bank Governor Per Jansson talks about the economic situation and monetary policy in Stockholm.
- (0330 ET/0830 GMT) Bundesbank President Jens Weidmann speaks at a conference in Berlin on economic policy challenges.
- (1000 ET/1500 GMT) Federal Reserve Vice Chair for Supervision Randal Quarles gives seminannual testimony, "Federal Reserve's Supervision and Regulation of the Financial System" before the House Financial Services Committee in Washington D.C.
- (1800 ET/2300 GMT) Federal Reserve Chairman Jerome Powell participates in moderated audience question-and-answer session before the Federal Reserve Bank of Dallas Global Perspective Speaker Series in Dallas, Texas.
FX Recap
USD: The dollar index, a gauge of its value versus six major peers traded at 97.03 on Wednesday, down 0.28 percent. The index hit a 16-month high of 97.69 on Monday.
EUR/USD: The euro climbed higher on Wednesday as investor confidence rose on news Britain had struck a draft divorce deal with the European Union after more than a year of talks. The surge in the euro and sterling led investors to take profits on the U.S. dollar, which retraced from a 16-month high. The pair was currently trading around $1.1290 mark. A consistent close below $1.1217 will drag the parity down towards key supports around $1.1185 and $1.1080 levels respectively. Alternatively, reversal from key support will drag the parity higher towards key resistances around $1.1330, $1.1432, $1.1550 and $1.1620 marks respectively.
USD/JPY: The Japanese yen trades marginally lower in early Asia as prelim GDP data misses expectations. Pair was currently trading around 113.93 marks. It made intraday high at 113.98 and low at 113.75 levels. A sustained close above 114.06 is required to take the parity higher towards key resistances around 114.55, 115.25 and 117.98 marks respectively. Alternatively, a daily close below 113.79 will drag the parity down towards key supports around 112.60, 110.98, 110.27, 109.24, 108.72 and 107.90 marks respectively.
GBP/USD: The British pound traded at $1.3006 on Wednesday, gaining 0.25 percent as traders reduced bearish bets after Britain and the European Union agreed a preliminary text that would allow the United Kingdom to leave the EU with a deal that avoids a chaotic "hard Brexit" departure. A sustained close below $1.2868 requires for dragging the parity down towards key supports around $1.2827, $1.2662 and $1.2498 mark respectively. On the other side, key resistances are seen at $1.3047, $1.3187, $1.3215, $1.3362 and $1.3490 levels respectively.
AUD/USD: The Australian dollar clung to gains on Wednesday after signs of a possible thaw in Sino-U.S. trade relations prompted a bout of short-covering, though both remained within recent well-worn ranges. Figures on Australian wage growth showed some pick-up but not enough to alter the outlook for steady rates, while Chinese economic figures were too mixed to provide much direction. The Aussie held at $0.7222, having bounced from a trough of $0.7164 on Tuesday on news of a resumption of trade talks between Beijing and Washington. The pair made intraday high at $0.7237 and low at $0.7213 levels. Immediate support and resistance levels were seen at $0.7160 and $0.7303 mark respectively.
NZD/USD: The kiwi dollar stood at $0.6776, after likewise rallying from a low of $0.6709. Major support is down at $0.6424, with resistance around $0.6850. Pair made intraday high at $0.6782 and low at $0.6754 levels. A sustained close above $0.6762 is required to take the parity higher towards $0.6814 and $0.7050 mark respectively. Alternatively reversal from key resistance will take the parity down towards key supports around $0.6402 levels.
Equities Recap
Japan’s Nikkei was trading 0.19 pct higher at 21,852.50 points.
Australia’s S&P/ASX 200 was trading 1.60 pct lower at 5,741.85 points.
Shanghai composite index to open down 0.3 pct at 2,648.31 points and China's CSI300 index to open down 0.1 pct at 3,233.64 points.
Taiwanese stock was trading around 0.15 percent higher at 9,790.93 points.
Hong Kong’s Hang seng was trading 0.17 pct lower at 25,750.55 points.
India’s NSE Nifty was trading around 0.07 percent lower at 10,580.22 points while BSE Sensex was trading 0.12 points lower at 35,102.58 points.
South Korea’s Kospi was trading 0.26 percent lower at 2,066.44 points.
Commodities Recap
Oil markets struggled to find their footing on Wednesday after plunging by 7 percent the previous session, with surging supply and the spectre of faltering demand keeping investors on edge. U.S. West Texas Intermediate (WTI) crude oil futures were at $55.54 per barrel at 0159 GMT, down 15 cents from their last settlement. International benchmark Brent crude oil futures were up 4 cents at $65.51 per barrel.
Gold prices inched up on Wednesday as the U.S. dollar retreated from a 16-month high touched earlier in week, easing amid a surge in the euro and sterling on a draft Brexit agreement. Spot gold was up about 0.1 percent at $1,202.55 per ounce at 0101 GMT. U.S. gold futures were up 0.1 percent at $1,203 per ounce.
Treasuries Recap
Australian government bond futures firmed in line with Treasuries, partly on wagers the recent sharp slide in oil prices would temper future inflation globally. The three-year bond contract added 1 tick to 97.845, while the 10-year contract rose 2 ticks to 97.2800.
Yields on New Zealand government bonds were down between 1.5 and 2.5 basis points across the curve.
