Posted at 23 January 2023 / Categories Market Roundups
Market Roundup
•Canada Dec New Housing Price Index (MoM) 0.0%, -0.2% forecast, -0.2% previous
•French 6-Month BTF Auction 2.285%,2.526% previous
•French 3-Month BTF Auction 2.285%,2.164% previous
•French 12-Month BTF Auction 2.833%,2.822% previous
•US Dec Leading Index (MoM) -1.0%, -0.7% forecast,-1.0% previous
•EU Jan Consumer Confidence -20.9, -20.0 forecast,-22.2 previous
•US 3-Month Bill Auction 4.575%,4.560% previous
•US 6-Month Bill Auction 4.685%,4.685% previous
Looking Ahead - Economic data (GMT)
•00:30 Australian Dec NAB Business Confidence 3 forecast,-4 previous
•00:30 Australian Dec NAB Business Survey 20 previous
•00:30 Japan Services PMI 51.1 previous
•00:30 Japan Jan Manufacturing PMI 49.4 forecast,48.9 previous
•05:00 Japan BoJ Core CPI (YoY) 2.9% forecast,2.9% forecast,
Looking Ahead - Economic events and other releases (GMT)
•No data ahead
Currency Summaries
EUR/USD: The euro rose nine-month high against the dollar on Monday after hawkish comments on ECB member boosted euro across the board. European Central Bank (ECB) governing council member Klaas Knot said interest rates would rise by 50 basis points in both February and March and continue climbing in the months after. Knot is considered a hawk among policymakers and the comment was taken as push back against recent reports that the ECB would scale back to quarter-point moves from March. The euro reached as high as $1.0927 , to trade at its highest level since April last year, before paring gains to trade up 0.05% at $1.0860. Immediate resistance can be seen at 1.0927(23.6%fib), an upside break can trigger rise towards 1.0951 (Higher BB).On the downside, immediate support is seen at 1.0836(5DMA), a break below could take the pair towards 1.0769(18th Jan low).
GBP/USD: Sterling retreated on Monday from a seven-month high against the dollar hit in Asian hours, having been helped last week by data showing the British economy was performing better than feared, which also drove expectations of more interest rate hikes.The pound hit $1.24475 in early trade, its highest since June 10. Moves were exacerbated by thin liquidity due to the Lunar New Year holidays in major financial centres such as Hong Kong and Singapore.The British currency was last down 0.32% at $1.2359. Immediate resistance can be seen at 1.2421(23.6%fib), an upside break can trigger rise towards 1.2512(Higher BB).On the downside, immediate support is seen at 1.2302(5DMA), a break below could take the pair towards 1.2257 (Jan 18th low).
USD/CAD: The Canadian dollar was little changed against its U.S. counterpart on Monday as investors held off from making major bets ahead of a Bank of Canada interest rate decision this week, with the outcome seen as uncertain. Money markets see a 70% chance that Canada’s central bank will raise its benchmark interest rate by 25 basis points to a 15-year high of 4.50% at a policy announcement on Wednesday. The loonie was trading nearly unchanged at 1.3380 to the greenback, after touching its strongest intraday level since Jan. 13 at 1.3343 - a level that was not far off its strongest since November. Immediate resistance can be seen at 1.3407(5DMA), an upside break can trigger rise towards 1.3469(38.2% fib).On the downside, immediate support is seen at 1.3335 (23.6%fib), a break below could take the pair towards 1.3286(Lower BB).
USD/JPY: The dollar strengthened against yen on Monday after Bank of Japan's December policy meeting minutes showed, underscoring the significance of the central bank's decision to tweak its bond-market peg. At the Dec. 19-20 meeting, the BOJ kept its ultra-easy monetary policy but shocked markets with a surprise change to its yield curve control (YCC) policy that allowed long-term interest rates to rise. Before the nine-member board voted on the steps, the government representatives requested that the meeting be adjourned for about 30 minutes, the minutes showed on Monday. Strong resistance can be seen at 131.44(38.2% fib), an upside break can trigger rise towards 132.54 (Jan 12th high).On the downside, immediate support is seen at 129.33 (5DMA), a break below could take the pair towards 128.98 (23.6%fib).
Equities Recap
European stocks climbed on Monday, with technology firms spearheading gains, as optimism about the eurozone economy likely avoiding a steep recession overshadowed hawkish remarks from European Central Bank (ECB) officials.
UK's benchmark FTSE 100 closed up by 0.18 percent, Germany's Dax ended up by 0.46 percent, France’s CAC finished the day up by 0.52 percent.
Wall Street closed sharply higher on Monday, fueled by surging technology stocks as investors began an earnings-heavy week with a renewed enthusiasm for market-leading momentum stocks that were battered last year.
Dow Jones closed up by 0.76% percent, S&P 500 closed up by 1.19% percent, Nasdaq settled up by 2.01% percent.
Treasuries Recap
U.S. Treasury yields kept creeping up on Monday, further eroding a recent bond rally that some investors think was overdone in reflecting fears that the U.S. economy may soon enter a recession.
The benchmark 10-year Treasury yield and two-year yields were up about four and five basis points, respectively, to 3.524% and 4.238%.
Commodities Recap
Gold prices reversed course to edge up on Monday as the dollar pared gains, while investors looked ahead to more U.S. economic data amid expectations of a slower pace of interest rate hikes.
Spot gold fell 0.2% to $1,922.45 per ounce by 12:02 p.m. ET (1702 GMT). It climbed to its highest since April 2022 on Friday.U.S. gold futures settled little changed at $1,928.6.
Oil prices settled mixed on Monday, retreating as investors cashed in on a jump to a seven-week high on optimism about a possible recovery in demand of top oil importer China as the economy recovers this year from pandemic lockdowns.
Brent crude settled 56 cents higher at $88.19 a barrel. The session high was $89.09 a barrel, the highest since Dec. 1. U.S. West Texas Intermediate (WTI) crude settled 2 cents lower at $81.62 a barrel, off the session high $82.64 a barrel, the highest since Dec. 5.