Market Roundup
- Germany Dec 2018 BW State CPI yy decrease to 2 % vs previous 2.7 %
- Germany Dec 2018 NW State CPI yy decrease to 1.8 % vs previous 2.4 %
- United Kingdom Nov 2018 UK finance mortgage apps decrease to 39.403 no. of vs previous 39.64 no. of (revised from 39.697 no. of)
- Spain Oct 2018 current account balance decrease to 0.3 eur vs previous 0.9 eur
- Germany Dec 2018 HE State CPI yy decrease to 1.4 % vs previous 2.1 %
- Germany Dec 2018 HE State CPI mm decrease to -0.1 % vs previous 0.3 %
- Germany Dec 2018 BY State CPI yy decrease to 2.2 % vs previous 2.7 %
- Switzerland Dec 2018 KOF indicator decrease to 96.3 diff.idx (forecast 98.7 diff.idx) vs previous 98.9 diff.idx (revised from 99.1 diff.idx)
- Germany Dec 2018 SN State CPI yy decrease to 1.9 % vs previous 2.1 %
- Germany Dec 2018 SN State CPI mm increase to 0.4 % vs previous -0.1 %
- Spain Dec 2018 CPI yy flash nsa decrease to 1.2 % vs previous 1.7 %
- Spain Q3 2018 GDP yy decrease to 2.4 % (forecast 2.5 %) vs previous 2.5 %
- Spain Q3 2018 GDP qq stays flat at 0.6 % (forecast 0.6 %) vs previous 0.6 %
- Spain Dec 2018 HICP flash yy decrease to 1.2 % (forecast 1.6 %) vs previous 1.7 %
Economic Data Ahead
- (0830 ET/1330 GMT) U.S. prelim Wholesale Inventories
- (0830 ET/1330 GMT) U.S. Goods Trade Balance
- (1000 ET/1500 GMT) U.S. Pending Home Sales
- (1000 ET/1500 GMT) U.S. New Home Sales
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index slumped to a 1-week low as the partial U.S. government shutdown is likely to continue into 2019 and no sign of any progress toward a plan to fund nine government departments that closed after funding ran out December 21. The greenback against a basket of currencies trades 0.4 percent down at 96.22, having touched a low of 96.21, its lowest since December 20.
EUR/USD: The euro rallied to a 1-week peak as the greenback eased after data showed consumer confidence at its weakest in more than three years in the United States. The European currency traded 0.2 percent up at 1.1449, having touched a high of 1.1467 earlier, its highest since Dec. 21. Immediate resistance is located at 1.1472 (November 20 High), a break above targets 1.1500 (November 7 High). On the downside, support is seen at 1.1393 (November 19 Low), a break below could drag it till 1.1318 (December 4 Low).
USD/JPY: The dollar plunged, extending previous session losses, as concerns about slowing global economic growth and a partial government shutdown in the United States send investors seeking safety in safe-haven assets such as the Japanese yen. The major was trading 0.5 percent down at 110.36 on Monday, having hit a low of 110.26 on Monday, its lowest since August 22. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. prelim wholesale inventories, pending home sales and new home sales. Immediate resistance is located at 111.24 (Sept. 10 High), a break above targets 111.53 (Sept. 4 High. On the downside, support is seen at 110.11 (August 13 Low), a break below could take it lower 109.77 (August 21 Low).
GBP/USD: Sterling edged higher as a broadly weaker dollar offered some support to the British currency. Investors now await another round of Brexit developments, where Prime Minister Theresa May will try to convince lawmakers to back her Brexit withdrawal arrangement next month, and then seek parliamentary approval for her deal. The major traded 0.2 percent up at 1.2667, having hit a high of 1.2738 on Monday; it’s highest since Dec. 10. Immediate resistance is located at 1.2705 (December 18 High), a break above could take it near 1.2758 (December 10 High). On the downside, support is seen at 1.2600, a break below targets 1.2560. Against the euro, the pound was trading 0.1 percent down at 90.41 pence, having hit a low of 90.60on Thursday, it’s lowest since December 12.
USD/CHF: The Swiss franc rallied to a near 3-month peak as increasing concerns about a trade dispute between the United States and China dented investor risk sentiment. The major trades 0.6 percent down at 0.9819, having touched a low of 0.9815 earlier; it’s lowest since October 1. On the higher side, near-term resistance is around 0.9909 (October 16 High) and any break above will take the pair to next level till 0.9965 (December 12 High). The near-term support is around 0.9797 (Oct. 1 Low), and any close below that level will drag it till 0.9739 (Sept. 28 Low).
Equities Recap
European shares advanced, boosted by gains in the oil sector, while the greenback plunged to a 1-week low amid a partial government shutdown in the United States.
The pan-European STOXX 600 index gained 1.6 percent at 334.86 points, while the FTSEurofirst 300 index surged 1.7 percent to 1,322.53 points.
Britain's FTSE 100 trades 1.7 percent up at 6,697.58 points, while mid-cap FTSE 250 gained 1.6 to 17,362.40 points.
Germany's DAX rose 1.6 percent at 10,549.13 points; France's CAC 40 trades 1.5 percent higher at 4,669.72 points.
Commodities Recap
Crude oil prices surged by 2 percent but remained close to their lowest levels in more than a year as rising U.S. inventories and concern over global economic growth weighed on market sentiment. International benchmark Brent crude was trading 1.5 percent up at $53.73 per barrel by 0955 GMT, having hit a low of $50.05 on Wednesday, its lowest since September 2017. U.S. West Texas Intermediate was trading 1.1 percent up at $45.80 a barrel, after falling as low as $43.34 on Monday, its lowest since early June 2017.
Gold prices rallied to a more than 6-month high, as concerns about slowing global economic growth and a partial government shutdown in the United States stoked safe-haven demand. Spot gold gained 0.05 percent to $1,276.02 per ounce as of 1002 GMT, having touched a high of $1,282.01 earlier, its highest level since June 19. U.S. gold futures inched up 0.2 percent to $1,283.2 per ounce on Friday.
Treasuries Recap
The 10-year U.S. Treasury note yield was up 3 basis points at 2.773 percent, retreating from a 9-month low of 2.720 percent touched earlier in the week.
The Italian 10-year government bond yield rose 2 basis points to 2.77 percent, but were still close to a 3-month low of 2.723 percent hit last week, while the spread over Germany was at 253 bps, also near recent lows. The 5-year yields were 3 basis points higher at 1.85 percent. The German 10-year yields were up a basis point to around 2.5 percent, while the Spanish 10-year government bond yields edged higher at 1.40 percent.
The Japanese government bond prices edged higher, with the yield on 10-year JGBs down 1.0 basis point at 0.010 percent. The 10-year March JGB futures gained 0.04 point to 152.37, while the 2-year yield and 5-year yield were both down half a basis point, to minus 0.130 percent and minus 0.135 percent, respectively. The 20-year yield was off 0.5 basis point at 0.510 percent.
