Market Roundup
- Thai Nov Manufacturing Output +0.1 pct on year (versus -2.0 pct in Reuters poll) - Industry Ministry
- PBoC sets yuan mid-point at 6.4864 / dlr vs last close 6.4880
- China C. Bank sets yuan mid-point at a 4-1/2 year low - RTRS
- Large China copper smelters to cut spot metal sales by up to 200,000 t in q1 2016 - Source
- Saudi ARAMCO's Falih says Saudi Arabia has more capacity than others to wait out market until it balances - RTRS
- China FX regulator head Yi Gang will remain deputy governor of central bank - Caixin
- (0300 ET/0800 GMT) Turkey Economic Confid Idx
- (0300 ET/0800 GMT) Spain Retail Sales YY
- (0330 ET/0830 GMT) Sweden Household Lending Growth
- (0330 ET/0830 GMT) Sweden Trade Balance MM
- (0400 ET/0900 GMT) Italy Business Confidence
- (0400 ET/0900 GMT) Italy Consumer Confidence
- (0400 ET/0900 GMT) Turkey Foreign Arrivals YY
- (0500 RT/1000 GMT) Brazil IGP- M Inflation Index
- (0730 ET/1230 GMT) Brazil Primary Budget Surplus
- (0730 ET/1230 GMT) Brazil Nominal Budget Balance
- (0730 ET/1230 GMT) Brazil Gross Debt/GDP Ratio
- (0730 ET/1230 GMT) Brazil Net Debt/GDP Ratio
Key Events Ahead
No Major Events Scheduled
FX Beat
USD: The yen gained against the dollar as soured risk sentiment favoured the safe haven Japanese currency, while the Canadian dollar struggled near an 11-year low against the greenback as crude oil prices resumed their slide.
NZD/USD: The New Zealand dollar gained up to a 2-month high of $0.6871 and looked on track for an increase of nearly 3 cents this month. The kiwi soared up on relatively high New Zealand yields. The pair currently trades at 0.6868 levels, after making a high of 0.6871. Techs bullish, test of 0.6900 levels (Oct 15/16 tops) are likely, RSIs remain biased up, price action is above the cloud and 5&10 DMAs. 0.6850 200-DMA resistance now flips to support, then 0.6834 5-DMA is the next support. Little chart resistance till 0.6887 (Oct 16 high) and 0.6897 (Oct 15 high).
USD/JPY: The yen advances to a 2-month high vs dollar as soured risk sentiment favoured the safe haven Japanese currency. The pair currently trades at 120.33 levels, after hitting session lows at 120.23 levels. Further weakness could take it to a 2-month low of 120.01 (Oct 28 low). Support is located at 120.10 (Previous day Low), while on the upside, immediate resistance is seen at 120.59 level (5 - DMA).
EUR/USD: The euro gained 0.1 percent to $1.0988, on Monday. The pair currently trades at 1.0978 levels, after having touched a daily high of 1.0982 levels. Trading has thinned as participants have closed out their positions before the year's end, confining the common currency to a narrow 1.0869 - 1.0992 range over the past three sessions. Immediate resistance is located at 1.0992 (Previous day High) and break above can take the pair to 1.1011 level (Dec 16 High). On the downside, support is seen at 1.0951 (5-DMA) and break below can take the pair to 1.0945 (Dec 14 Low).
AUD/USD: The Australian dollar gained around 0.2 percent on the day to $0.7262. The pair is extending gains from 0.7097 levels, after a brief pause on Monday. The Aussie was enroute for a loss of nearly 13 percent in 2015, hit by factors including central bank monetary easing earlier in the year, sliding commodities and fears of an economic slowdown in China, Australia's key trading partner. Currently it trades at 0.7263 levels, after having touched a daily high of 0.7269 levels. Immediate resistance is seen at 0.7283 (Dec 15 High) and on the downside, support is located at 0.7238 (20 - DMA). Against its Canadian counterpart, the Aussie held its own at C$1.0083, not far from a recent 16-month peak of C$1.0109.
USD/CNY: China's yuan firmed against the dollar on Tuesday having earlier hit its weakest level in 4-1/2 years on strong dollar demand, as PBoC's set the yuan midpoint rate at 6.4864 per dollar, 0.2 percent weaker than the previous fix 6.4750. In the spot market, the Chinese currency trades at 6.4857 per dollar at midday, 0.04 percent firmer than the previous close. It opened at 6.4897 per dollar and shortly eased to 6.4948, its weakest since May 2011. The offshore yuan was trading 1.26 percent softer than the onshore spot at 6.5687 per dollar.
Equities Recap
Asian stocks positive on Tuesday, shrugging off early losses as Chinese shares stabilized a day after marking their biggest loss in a month and crude prices took back some lost ground.
MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.1 percent, but looked set for a loss of around 12 percent for the year. China's blue-chip CSI300 Index gained 0.3 percent, while the Shanghai Composite Index edged up 0.2 percent.
Australia's S&P/ASX 200 Index climbed up 0.87 pct at 5,252.70 points, while Nikkei closes up 0.58 pct at 18,982.23 with Seoul Shares edged up 0.09 pct.
Commodities Recap
Gold struggled to recover from overnight losses on Tuesday as a relentless slide in oil prices dented demand for the metal, often seen as an inflation-hedge. Spot gold was changed at $1,070.05 an ounce by 0116 GMT, after losing 0.6 percent in the previous session. Volumes remained thin in the last trading week of the year. In the absence of strong trading cues and liquidity, gold is likely to remain range-bound for the remainder of the week, tracking oil and currency markets.
Crude oil prices remained under pressure on Tuesday as fears of slowing demand added to worries over near-record global production levels that have slashed prices by two-thirds since the middle of last year. Front-month U.S. West Texas Intermediate futures were trading at $36.83 per barrel at 0334 GMT, similar to Monday's close after a more than 3 percent drop. The international benchmark Brent was at $36.67 per barrel, virtually unchanged from its last settlement but less than a dollar away from an 11-year low hit earlier in December.
Treasuries Recap
U.S. 10-Year Treasuries yield stood at 2.2269 percent, up by 0.002.
Australian government bond futures rose to 8-week highs, with the 3-year bond contract up 5 ticks at 97.990. The 10-year contract added 6 ticks to 97.2250, while the 20-year contract held steady at 96.7300.
New Zealand government bonds eased a tad, sending yields half a basis point higher across the curve.
