Market Roundup
- EUR/USD +0.26%, USD/JPY +0.39%, GBP/USD -0.3%
- DXY -0.22%, DAX +0.05%, Brent +-0.08%, Iron +2.4%, Gold +0.06%
- Germany Q3 Detailed GDP 1.5% y/y vs 1.5% previous, 1.7% expected
- Germany Nov IFO Bus Climate 110.4 vs revised110.4 previous, 110.5 expected
- Germany Nov IFO Current Conditions 115.6 vs revised110.4 115.1 previous, 115.00 expected
- UK Oct Mortgage Approvals 40.851k vs revised110.4 38.690k previous
- NBH Vice Gov Nagy-No plans to change base rate
- BBC-FPO candidate for Austrian presidency Hofer may back EU vote
- Russia’s Novak-Discussions with OPEC are going positively
- China banks seen selling USD to brake CNY slide
- Fears over long-term RMB devaluation groundless – Securities Times
- S. Korea TradeMin - Will monitor exports to Japan, China on volatile FX
- Japan MoF Asakawa – Trump presidency won’t change Japan FX policy
- Japan government bond floats to hit 8-year low – Nikkei
- Japan Nov flash manufacturing PMI 51.1, Oct final 51.4, new orders down
Economic Data Ahead
- (1645 ET/2145 GMT) The Statistics New Zealand releases its trade balance data for the month of October. The economy posted an annual trade deficit of $3.4 billion in September.
- (1830 ET/2330 GMT) Japan's Statistics Bureau will release its National Consumer Price Index for the month of October. The index is likely to post an annualized decline of 0.4 percent after slumping 0.5 percent in the previous month.
- (1850 ET/2350 GMT) Japan's Ministry of Finance reports foreign investment in domestic stocks for the week ending November 18.
- (1850 ET/2350 GMT) Japan's Ministry of Finance will report foreign bond investment for the week ending November 18.
Key Events Ahead
- No Significant Event Scheduled
FX Beat
DXY: The dollar rose to multi-month highs against its major rivals as upbeat U.S. economic data and FOMC meeting minutes strengthened the prospects of imminent U.S. interest rate hike. The greenback against a basket of currencies trades 0.2 percent down at 101.49, having touched a near 14 year high of 102.05 earlier in the session. FxWirePro's Hourly Dollar Strength Index stood at 49.99 (Bias Neutral) by 1100 GMT.
EUR/USD: The euro steadied after declining to a near 1-year low earlier in the session, following mixed results from the German IFO Survey for the month of November. The Survey showed Current Assessment at 115.6 surpassing estimates of 115, while Business Climate and Expectations stood at 110.4 and 105.5, respectively, both missing forecasts. The European currency trades 0.1 percent up at 1.0559, having hit an early low of 1.0518, its lowest since Dec. FxWirePro's Hourly Euro Strength Index stood at -67.42 ( Neutral) by 1000 GMT. The short term trend is still weak as long as resistance1.0660 holds and any violation above will target 1.0750/1.0820. On the lower side, any break below 1.0515 will drag the pair till 1.04780/1.0450 in the short term.
USD/JPY: The dollar rose above the 113.00 handle to hit a fresh 8-month high, as the greenback remained underpinned by strong U.S. durable goods orders and December Fed rate-hike expectations, which got an additional boost from FOMC meeting minutes. Moreover, the selling pressure around the Japanese yen intensified after data released earlier showed Japan's preliminary manufacturing PMI weakened in November to 51.7 from 51.4. The major trades 0.5 percent higher at 113.02, after rising as high as 113.53, its strongest since late March. FxWirePro's Hourly Yen Strength Index stood at -44.25 ( Neutral) by 1000 GMT. The major resistance is around 114.08 (161.8% retracement of 113.53 and 112.73) and a break above targets 115/115.53. On the lower side, minor support is around 112.20 (hourly Kijun-sen) and any break below targets 111.24/110 (200- H MA).
GBP/USD: Sterling rose, extending gains from the previous session, as markets continued to scrutinize Britain's Autumn Statement on the budget. The major was also supported by upbeat UK mortgage approval for homes data, which showed consumer credit grew more than 7 percent year-on -year basis in October, its strongest growth since Nov 2006. Sterling initially fell towards the 1.2400 handle, however, it made a minor recovery to trade 0.3 percent higher at 1.2477 for the day. FxWirePro's Hourly Sterling Strength Index stood at 113.96 (Highly Bullish) by 1000 GMT. The immediate resistance is around 1.2530 and any violation above this level will take the pair to next level till 1.2600/1.2675 in the short term. The short term bottom is around 1.2300 and any break below will drag the pair till 1.2202 (61.8% retracement of 1.19048 and 1.26738). Against the euro, the pound was little changed at 84.72 pence, having hit a high of 84.64 pence in the previous session, it’s highest since Sept.
USD/CHF: The Swiss franc hit fresh 9-month low against the dollar, as growing expectations of a Federal Reserve rate hike in December boosted the greenback across the board. The major trades up at 1.0160, having hit a high of 1.0191, its strongest since early Feb. However, the upside remained capped, as data showed Switzerland's industrial production rose to 0.4 in the third quarter, while on an annualized basis it stood at 6.6 percent. The minor support is around 1.0090 and any break below will drag the pair down till 1.00400 (232.6% retracement of 0.95493 and 1.0194)/1.0000. On the higher side, any break above 1.0200 will take it to next level till 1.0260/1.0320.
AUD/USD: The Australian dollar gained, reversing most of its previous session losses, as the greenback against a basket of currencies retreated from multi-year highs. Moreover, positive sentiment surrounding commodities also boosted the bid tone around the pair. The Aussie trades 0.2 percent higher at 0.7401, having touched an early high of 0.7418, and drifting further away from a 5-month trough of 0.7311 hit on Monday. FxWirePro's Hourly Aussie Strength Index stood at 19.11 (Bias Neutral) by 1100 GMT. On the higher side, minor resistance is around 0.7465 (10- day MA) and any break above will take the pair till 0.7520/0.7580. The major support is around 0.73000 and break below will drag it till 0.7280/0.7250.
NZD/USD: The New Zeeland dollar retreated after declining to a near 4-month low as the U.S. dollar index slightly weakened. However, the recovery appears to be fragile as the greenback continues to remain strong across the board on upbeat US durable goods orders data and hawkish FOMC meeting minutes. The Kiwi trades up at 0.7004, drifting away from an early low of 0.6971, it’s lowest since Jul. 25. FxWirePro's Hourly Kiwi Strength Index was at -112.20 (Highly Bearish) by 1100 GMT. Immediate resistance is located at 0.7028 (5-DMA), a break above could take it near 0.7046 (7-EMA). On the downside, support is seen at 0.6951 (July-21 Low), a break below could drag it near 0.6900.
Equities Recap
European shares edged up, as losses in telecom and utilities stocks were partly offset by gains in chemical and insurance companies.
The pan-European STOXX 600 index increased 0.03 percent at 340.86 points, while the FTSEurofirst 300 index was little changed at 1,344.13 points.
Britain's FTSE 100 trades 0.05 percent down at 6,813.23 points, while mid-cap FTSE 250 lost 0.18 percent at 17,590.59 points.
Germany's DAX gained 0.17 percent at 10,680.04 points; France's CAC 40 trades 0.21 percent higher at 4,538.42 points.
Tokyo's Nikkei rose 0.94 percent to 18,333.41 points, Australia's S&P/ASX 200 index ended flat at 5,484.60 points and South Korea's KOSPI declined 0.84 percent at 1,971.26 points.
Shanghai composite index closed flat at 3,241.74 points, while CSI300 index gained 0.4 percent at 3,488.74 points. Hong Kong’s Hang Seng shed 0.3 percent at 22,608.49 points.
Commodities Recap
Crude oil prices nudged up, but consolidated within narrow ranges as investors remained uncertain about OPEC's ministerial meeting outcome at the end of this month. International benchmark Brent crude was trading 0.2 percent higher at $49.01 per barrel by 0947 GMT, having hit a peak of $49.93 earlier in the week, its highest since late Oct. U.S. West Texas Intermediate crude rose 0.27 percent at $48.05 a barrel, after rising to a 3-week high of $49.17 on Tuesday.
Gold prices steadied, after declining to a near 10-month low earlier in session, as the greenback stood firm across the board on growing expectations of a Federal Reserve rate hike in December. Spot gold was up 0.15 percent at $1,187.76 an ounce by 0953 GMT, having declined to an early low of $1,180.17, its lowest since early Feb. U.S. gold futures eased 0.3 percent to $1,185.60 per ounce.
Treasuries Recap
The U.S. Treasuries were pushed lower across the curve after as the Federal Reserve November meeting minutes indicated that majority of the FOMC members are in favour of a December rate hike. The yield on the benchmark 10-year Treasury note rose 3-1/2 basis points to 2.35 percent, the yield on long-term 30-year Treasury jumped 1-1/2 basis points to 3.02 percent and the yield on short-term 2-year note bounced 3-1/2 basis points to 1.13 percent.
The UK gilts traded nearly flat ahead of third-quarter gross domestic product (GDP) data, which is scheduled to be released on Friday at 09:30 GMT. The yield on the benchmark 10-year gilts hovered around 1.44 percent, the super-long 30-year bond yield remained steady at 2.08 percent and the yield on short-term 2-year stood flat at 0.14 percent.
The German bunds strengthened after recent data showed that the country’s economic growth slowed in the third quarter in the wake of weak exports. The yield on the benchmark 10-year bond fell 4 basis points to 0.24 percent, the yield on long-term 30-year note dipped nearly 4 basis points to 0.87 percent and the yield on short-term 2-year bond slid 2 basis points to -0.72 percent.
The Japanese government bonds slumped Thursday following a heavy sell-off in U.S. Treasuries. The benchmark 10-year bond yield rose 1 basis point to 0.040 percent, the yield on long-term 30-year note climbed 2-1/2 basis points to 0.65 percent and the yield on short-term 2-year note inched ½ basis point higher to -0.16 percent.
The New Zealand government bonds closed modestly firmer after witnessing a heavy intraday sell-off as the Federal Reserve November meeting minutes indicated that majority of the FOMC members are in favour of a December rate hike. The yield on the benchmark 10-year bond closed 1 basis point lower at 3.220 percent (rose nearly 10 basis points intraday), the yield on 7-year note also ended nearly 1 basis point lower to 2.83 percent and the yield on short-term 2-year note bounced 6 basis points to 2.19 percent.
The Australian government bonds plunged as investors moved away from the safe-haven buying amid weakness in the U.S. Treasuries after the Federal Reserve November meeting minutes reflected support for a December rate hike. The yield on the benchmark 10-year Treasury note rose more than 6 basis points to 2.78 percent (highest since January this year), the yield on 15-year note jumped 4-1/2 basis points to 3.17 percent and the yield on short-term 2-year bounced 3 basis points to 1.86 percent.
