Posted at 18 December 2023 / Categories Market Roundups
Market Roundup
•Canada Nov New Housing Price Index (MoM) -0.2%, 0.1% forecast, 0.0% previous
•French 12-Month BTF Auction 3.690% ,3.423% previous
•French 3-Month BTF Auction 3.729% ,3.778% previous
•French 6-Month BTF Auction 3.333%,3.739% previous
•US Dec NAHB Housing Market Index 37, 36 forecast, 34 previous
Looking Ahead Economic Data(GMT)
•No data ahead
Looking Ahead Events And Other Releases(GMT)
• No events ahead
Currency Summaries
EUR/USD: The euro gained on Monday as the US currency remained under pressure following the Federal Reserve's announcement last week that interest rates could be slashed next year. Expectations that the Federal Reserve will reduce its benchmark overnight interest rate by a quarter of a percentage point at its March meeting surged last week. This followed the decision by the U.S. central bank to maintain its policy rate within the 5.25%-5.50% range and the officials' projection of three-quarters of a percentage point in cuts for the upcoming year. On the data front, German business morale declined in December, according to the Ifo institute's latest survey, which also revealed decreases in both expectations and current conditions. The institute reported that its business climate index stood at 86.4, falling short of analysts' forecasts of 87.8 in a poll. . Immediate resistance can be seen at 1.0931(38.2%fib), an upside break can trigger rise towards 1.1000(Psychological level).On the downside, immediate support is seen at 1.0893 (5DMA), a break below could take the pair towards 1.0845(50%fib).
GBP/USD: Sterling eased against dollar on Monday as investors awaited UK inflation data on Wednesday. The UK Consumer Price Index (CPI) inflation data is set to be released on Wednesday, with projections indicating a year-on-year figure of 4.4%, a decrease from the previous 4.6%. Additionally, the core CPI figure is expected to be around 5.5%. The UK economy, meanwhile, is flat-lining and economic output is back at levels registered in January.But the economy has avoided recession so far and a reading of business activity last week showed a surprise pick-up in growth and a small slowdown in price pressures in the services sector in early December. Immediate resistance can be seen at 1.2679 (38.2%fib), an upside break can trigger rise towards 1.2786(23.6%fib).On the downside, immediate support is seen at 1.2616(5DMA), a break below could take the pair towards 1.2590(50%fib).
USD/CAD: The Canadian dollar slightly weakened against its U.S. counterpart but remained close to its strongest level in four months as s oil prices rose and investors awaited domestic inflation data. The Canadian central bank has maintained the possibility of further tightening while expressing growing confidence in achieving its 2% inflation target. Meanwhile, the price of oil, a significant Canadian exportgained 1.5% settling at $72.47 a barrel. This uptick was influenced by disruptions in maritime trade due to attacks by the Iran-aligned Yemeni Houthi militant group on ships in the Red Sea, leading to increased supply costs. The loonie was trading 0.1% lower at 1.3390 to the greenback, or 74.68 U.S. cents after moving in a range of 1.3351 to 1.3409. Immediate resistance can be seen at 1.3711 (38.2% fib), an upside break can trigger rise towards 1.3758 (5DMA).On the downside, immediate support is seen at 1.3644(38.2% fib), a break below could take the pair towards 1.3577 (50% fib).
USD/JPY: The greenback strengthened against yen on Monday as the Bank of Japan (BOJ) kicked off a two-day meeting that could be crucial in determining the timing of the end of the central bank’s ultra-loose stance on interest rates. The Japanese currency has had a volatile few weeks, as markets struggle to get a grip on how soon the BOJ could phase out its negative interest rate policy, with comments from Governor Kazuo Ueda this month initially sparking a huge rally in the yen.That was later reversed on news that a policy shift was unlikely to come as early as December, and investors now await Tuesday's BOJ decision for further clarity on the bank's rate outlook.Strong resistance can be seen at 142.32(38.2%fib),an upside break can trigger rise towards 143.88(50%fib).On the downside, immediate support is seen 141.02(Dec 15th low)a break below could take the pair towards 140.31(23.6%fib).
Equities Recap
European stocks retreated on Monday following recent robust gains, with a drop in auto shares and statements from central bank officials dampening expectations of early interest rate cuts in the coming year.
UK's benchmark FTSE 100 closed up by 0.50 percent, Germany's Dax ended down by 0.60 percent, France’s CAC finished the day down by 0.37 percent.
U.S. stocks gained ground on Monday as market participants analyzed increased expectations of interest rate cuts from the Federal Reserve in the coming year and looked ahead to a week of crucial economic data.
Dow Jones closed up by 0.01 percent, S&P 500 ended up by 0.45 percent, Nasdaq finished the day up by 0.65 percent.
Commodities Recap
Gold gained ground as traders purchased bullion on price dips, while their focus shifted to key the upcoming inflation data for signals on the Fed's plans.
Spot gold added 0.4% to $2,026.62 an ounce. U.S. gold futures gained 0.58% to $2,026.30 an ounce.
Oil prices surged by nearly 2% on Monday amid concerns among investors about potential disruptions to maritime trade and increased supply costs after Iran-backed attack by Yemeni Houthi militant group on ships in the Red Sea.
Brent crude futures settled higher $1.40, or 1.8%, to $77.95 a barrel, while U.S. West Texas Intermediate crude rose $1.04, or 1.5%, to $72.47. Both benchmarks had risen nearly $3 earlier in the session.