Posted at 28 December 2022 / Categories Market Roundups
Market Roundup
•Markets unnerved by rising COVID cases in China
•U.S. Fed expected to continue increasing interest rates
•Oil benchmarks hit 3-week high in previous session
•U.S. crude oil stocks declined last week, distillate rose - API data
•US Redbook (YoY) 9.6%,7.6% previous
•US Nov Pending Home Sales Index 73.9,77.1 previous
•US Dec Richmond Manufacturing Index -10 forecast,-9 previous
•US Dec Richmond Services Index-12, -2 previous
•US Dec Richmond Manufacturing Shipments 5, -8 previous
•US Nov Pending Home Sales (MoM) -4.0%,-0.8% forecast,-4.6% previous
•US Dec Texas Services Sector Outlook -19.8, -11.0 previous
•US Dec Dallas Fed Services Revenues -0.6, 5.5 previous
•US 5-Year Note Auction 3.973%, 3.974% previous
Looking Ahead - Economic events(GMT)
•No data head
Looking Ahead - Economic events and other releases (GMT)
• No significant event
Currency Summaries
EUR/USD: The euro dipped against dollar on Wednesday as investors eyed 2023 with caution and weighed hopes for an economic boost from China's relaxed COVID-19 restrictions against concerns about rising infections there. Investors were still digesting China's announcement on Monday of the end to quarantine requirements for inbound travellers on Jan. 8. China's health system has come under heavy stress since Beijing lifted domestic restrictions. The euro was down by 0.18% at $1.06225. Immediate resistance can be seen at 1.0703(23.6%fib), an upside break can trigger rise towards 1.0723(Higher BB).On the downside, immediate support is seen at 1.0580(21DMA), a break below could take the pair towards 1.0522(38.2%fib).
GBP/USD: The pound initially gained against dollar on Wednesday but gave ground as Britain's markets reopened after a long weekend, before leveling out. Throwing a wrench in the works for markets in the final week of the year is China's rapid dismantling of the strict zero-COVID policies that have severely hampered its economy for nearly three years.Investors are having to reconcile the pick-up in economic activity as China's consumers and businesses return to some kind of normality while also dealing with the impact of a surge in infections. The pound last fell 0.02% against the dollar at 1.2013. Immediate resistance can be seen at 1.2182( 21DMA), an upside break can trigger rise towards 1.2252(23.6%fib).On the downside, immediate support is seen at 1.1976(38.2%fib),a break below could take the pair towards 1.886 (Lower BB).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Wednesday as oil prices fell and the greenback gained ground against a basket of major currencies. The price of oil, one of Canada’s major exports, closed lower but had regained some lost ground by settlement as traders weighed COVID news from China.U.S. crude settled down 0.07% at $78.96 per barrel while Brent finished at $83.26, down 1.27% on the day. The dollar index , which measures the U.S. currency against six major rivals, rose 0.202% to 104.420. It hit a six-month low of 103.44 two weeks ago, when the Federal Reserve slowed the pace of its interest rate increases .Immediate resistance can be seen at 1.3603 (38.2% fib), an upside break can trigger rise towards 1.3701 (23.6% fib).On the downside, immediate support is seen at 1.3538(50% fib), a break below could take the pair towards 1.3459(61.8% fib).
USD/JPY: The dollar touched a one-week high against the yen on Wednesday, boosted by a jump in Treasury yields and investor expectations for a rebound in Chinese growth as COVID-19 curbs loosen.The dollar rallied by as much as 0.67% against the yen to 134.35 in US trading, the most since Dec. 20, when the Bank of Japan sent the pair spiraling lower with an unexpected loosening of the 10-year Japanese government bond yield policy band. That day, the yen staged its biggest one-day rally against the dollar in 24 years, closing 3.8% higher. Strong resistance can be seen at 135.48(38.2%fib), an upside break can trigger rise towards 13.60(Psychological level).On the downside, immediate support is seen at 133.58(5DMA), a break below could take the pair towards 132.82(23.6% fib).
Equities Recap
European shares closed lower on Wednesday, weighed down by declines in energy stocks, while Britain's FTSE 100 outpaced peers after a Christmas holiday as investors assessed Beijing's steps towards reopening its COVID-battered economy.
UK's benchmark FTSE 100 closed up by 0.32 percent, Germany's Dax ended down by 0.50 percent, France’s CAC finished the day up by 0. 61 percent.
Wall Street's main indexes ended weaker on Wednesday, with the Nasdaq hitting a 2022 closing low, as investors grappled with mixed economic data, rising COVID cases in China, and geopolitical tensions heading into 2023.
Dow Jones closed down by 1.10 percent, S&P 500 ended down by 1.20 percent, Nasdaq finished the day down by 1.35 percent.
Commodities Recap
Gold prices dropped 1% on Wednesday, after reaching a six-month peak in the previous session, as a stronger dollar and higher Treasury yields weighed.
Spot gold fell 0.6% to $1,803.16 per ounce by 1:50 p.m. ET (1850 GMT), after falling to $1,796 earlier in the session. U.S. gold futures settled down 0.4% at $1,815.8.
Oil prices settled lower on Wednesday as traders weighed concerns over a surge in COVID-19 cases in China, the world's top oil importer, against the chances easing pandemic restrictions in the country will boost fuel demand.
Brent crude futures fell $1.07, or 1.3%, to settle at $83.26 a barrel, while U.S. West Texas Intermediate crude futures settled at $78.96 per barrel, down 57 cents, or 0.7%.