Posted at 21 January 2023 / Categories Market Roundups
Market Roundup
•Canada Nov Retail Sales (MoM) -0.1%, -0.5% forecast,-1.4% previous
•Canada Nov Core Retail Sales (MoM) -0.6%, -0.4% forecast,1.7% previous
•US Dec Existing Home Sales (MoM) -1.5%,-5.4% forecast,-7.7% previous
•US Dec Existing Home Sales 4.02M, 3.96M forecast,4.09M previous
• U.S. Baker Hughes Oil Rig Count 613,623 previous
• U.S. Baker Hughes Total Rig Count 771 ,725 previous
Looking Ahead - Economic data (GMT)
•No data ahead
Looking Ahead - Economic events and other releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro strengthened against dollar on Friday as investors debated whether the Federal Reserve's aggressive approach to tightening monetary policy to battle inflation might push the U.S. economy into recession. A flurry of U.S. data on Thursday indicated the world’s biggest economy was slowing down after multiple rate increases by the Fed. Money markets show traders are preparing for an end to rate rises by the middle of this year. With much top-tier data out of the way now, investors are waiting for the first Fed meeting of the year in early February. Immediate resistance can be seen at 1.0896(23.6%fib), an upside break can trigger rise towards 1.0950 (Higher BB).On the downside, immediate support is seen at 1.0778(5DMA), a break below could take the pair towards 1.0693(38.2%fib).
GBP/USD: The pound initially fell on Friday after weak retail sales data but recovered most the ground on expectations that the U.S. central bank will be forced to pivot to a more dovish policy if the U.S. economy enters a recession. Weaker than expected data has focused investor attention on the U.S. economy. The Fed is expected to raise rates by 25 basis points at the conclusion of its two-day meeting on Feb. 1, and investors will be keen for any new signals on what is likely at the U.S. central bank’s March meeting, and beyond. Sterling was up 0.07% against the dollar at $1.2396. Immediate resistance can be seen at 1.2395(Daily high), an upside break can trigger rise towards 1.2438(Higher BB).On the downside, immediate support is seen at 1.2265 (5DMA), a break below could take the pair towards 1.2173 (Jan 17th low).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Friday, recouping losses from earlier in the week, as equity markets rallied and investors turned attention to an upcoming interest rate decision by the Bank of Canada. Domestic data showed retail sales edging down by 0.1% in November from October. That’s better than the 0.5% decline economists had forecast, while a flash estimate showed sales rising by 0.5% in December. The loonie was trading 0.6% higher at 1.3382 to the greenback, or 74.73 U.S. cents, rebounding from its lowest intraday level in nearly two weeks at 1.3520 on Thursday. For the week, the currency was up 0.1%, for a fifth consecutive week of gains, the longest such sequence since May 2021.Immediate resistance can be seen at 1.3414(11DMA), an upside break can trigger rise towards 1.3453 (38.2%fib).On the downside, immediate support is seen at 1.3355 (23.6%fib), a break below could take the pair towards 1.3315(Lower BB).
USD/JPY: The dollar strengthened on Friday as the Bank of Japan governor repeated the central bank will maintain its ultra-loose monetary policy. BOJ Governor Haruhiko Kuroda, who addressed the World Economic Forum in Davos, Switzerland, said the central bank will maintain its "extremely accommodative" monetary policy to achieve its 2% inflation target in a stable, sustainable manner. the dollar shot up against the yen after the BOJ governor's remarks.The dollar rose as high as 130.60 yen and was last up 0.9% at 129.51. The greenback had its biggest percentage gain since early January. Strong resistance can be seen at 130.00 (Psychological level), an upside break can trigger rise towards 130.60 (38.2% fib).On the downside, immediate support is seen at 128.23 (23.6% fib), a break below could take the pair towards 127.04 (Lower BB).
Equities Recap
European stocks closed higher on Friday, lifted by optimism about Chinese economic growth, cooling inflation and prospects of the Federal Reserve and other major central banks slowing the pace of their interest rate hikes in the coming months.
UK's benchmark FTSE 100 closed up by 0.30 percent, Germany's Dax ended up by 0.76 percent, France’s CAC finished the day up by 0.63 percent.
U.S. stocks rallied to close higher on Friday, as the S&P 500 and Dow snapped a three-session losing streak and the Nasdaq rose more than 2%, as quarterly earnings helped lift Netflix, while Google parent Alphabet climbed after announcing job cuts.
Dow Jones closed up by 1.00% percent, S&P 500 closed up by 1.89% percent, Nasdaq settled up by 2.66% percent.
Treasuries Recap
U.S. Treasury yields rose on Friday as investors considered whether the Federal Reserve is likely to keep raising rates as far as it has indicated, and as investors bet that a recent bond rally was overdone in the short-term.
Benchmark 10-year yields were last at 3.482%, after falling to 3.321% on Thursday, the lowest since Sept. 13 and just above its 200-day moving average. The yields have dropped from 3.905% at year-end, and from a 15-year high of 4.338% on Oct. 21.
Commodities Recap
Gold prices edged lower on Friday as the dollar firmed, although hopes of slower rate hikes from the U.S. Federal Reserve kept bullion on track for its fifth straight weekly gain.
Spot gold fell 0.2% to $1,928.06 per ounce by 1:49 p.m. ET (1849 GMT), after rising to its highest since April 22 at $1,937.49 earlier in the session. Prices are up 0.4% so far this week.U.S. gold futures settled up 0.2% at $1,928.2.
Oil settled up about $1 a barrel on Friday and notched a second straight weekly gain as China's economic prospects brightened, boosting expectations for fuel demand in the world's second-biggest economy.
Brent crude settled at $87.63 a barrel, up $1.47, or 1.7%. U.S. crude settled at $81.31 a barrel, gaining 98 cents, or 1.2%.