Market Roundup
- Apple cuts sales forecast as China sales weaken; I Phone pricing in focus.
- No progress toward ending U.S. shutdown in Trump meeting with lawmakers.
- Brexit poses risk, but German economy poised for further growth – minister.
- UK services growth drops to two-year low in Q4 in Brexit "stasis" – BCC.
- Norway Oct 2018 labour force survey stays flat at 4 % (forecast 4 %) vs previous 4 %.
- Turkey Dec 2018 CPI mm increase to -0.4 % (forecast -0.23 %) vs previous -1.44 %.
- Turkey Dec 2018 PPI mm increase to -2.22 % vs previous -2.53 %.
Economic Data Ahead
- (0400 ET/0900 GMT) Germany Dec BB State CPI MM, -0.1% previous.
- (0400 ET/0900 GMT) Germany Dec BB State CPI YY, 1.8% previous.
- (0400 ET/0900 GMT) EZ Nov Money- M3 Annual Growth, 3.8% forecast, 3.9% previous.
- (0430 ET/0930 GMT) UK Dec Markit/CIPS Cons PMI, 52.9 forecast, 53.4 previous.
Key Events Ahead
- No major events are scheduled for the day.
FX Recap
USD: The dollar index was at 96.77, relatively unchanged from its previous close.
EUR/USD: The euro was down marginally at $1.1306 in early Asian hours. On Wednesday, the single currency fell 1 percent after data showed manufacturing activity contracted in Spain, France, Italy, and Germany. Pair was currently trading around $1.1365 mark. A consistent close below $1.1342 will drag the parity down towards key supports around $1.1270, $1.1185 and $1.1080 levels respectively. Alternatively, reversal from key support will drag the parity higher towards key resistances around $1.1472, $1.1550, $1.1620 and $1.1820 marks respectively.
USD/JPY The yen surged on Thursday through key technical levels as heightened worries about the global economy pushed investors to safe haven-assets in moves exacerbated by thin holiday volumes. Charging the risk averse mood was Apple Inc's move on Wednesday to cut its sales forecast for its latest quarter, on slowing I Phone sales in China. That followed a series of surveys that showed factory activity weakening across much of Europe and Asia in December. Market participants fled to the safety of the highly liquid Japanese yen which rose 1 percent versus the dollar on Thursday. In early Asian trade, the dollar tumbled to an intra-day low of 104.74 yen; it is lowest since March 2018. It made intraday high at 108.89 and low at 104.74 levels. A sustained close above 108.87 is required to take the parity higher towards key resistances around 110.48, 111.40, 112.60, 113.98, 114.55, 115.25 and 117.98 marks respectively. Alternatively, a daily close below 108.87 will drag the parity down towards key support around 101.40 marks respectively.
GBP/USD: The sterling fell more than 1 percent to $1.2400 on Thursday. Pair made intraday high at $1.2607 and low at $1.24 mark. A sustained close below $1.2603 requires for dragging the parity down towards key support around $1.2150 mark. On the other side, key resistances are seen at $1.2815, $1.3047, $1.3187, $1.3215, $1.3362 and $1.3490 levels respectively.
AUD/USD: The Australian dollar was picking up the pieces on Thursday after a torrent of automated selling against the yen sent it plunging to multi-year lows on a host of major currencies. The Aussie suffered some of the largest intra-day falls in its history amid a drought of liquidity and a cascade of computerized sales. At one point it was down 5 percent on the yen and almost 4 percent on the U.S. dollar, before clawing back much of the losses as trading calmed and humans took charge. The pair made intraday high at $0.6985 and low at $0.6744 levels.
NZD/USD: The kiwi falls noticeably against U.S. dollar and touched $0.6587 mark in early Asia hours. For the full year, the kiwi stumbled 5.4 percent for its worst annual performance since 2015. A sustained close below $0.6644 requires for the downside rally. Alternatively, key resistance was seen at $0.6722 mark.
Equities Recap
Australia’s S&P/ASX 200 was trading 1.36 pct higher at 5,633.40 points.
Shanghai composite index to open down 0.1 pct at 2,461.78 points and China's CSI300 index to open down 0.2 pct at 2,963.02 points.
Taiwanese stock was trading around 0.70 percent lower at 9,488.45 points.
Hong Kong’s Hang seng was trading 0.77 pct lower at 24,940.25 points.
South Korea’s Kospi was trading 0.60 percent lower at 1,998.55 points.
India’s NSE Nifty was trading around 0.25 percent lower at 10,758.58 points while BSE Sensex was trading 0.20 points lower at 35,815.55 points.
Commodities Recap
Oil prices slipped on Thursday amid volatile currency and stock markets, and as analysts warned of an economic slowdown for 2019 just as crude supplies are rising globally. U.S. WTI crude oil futures were dropped by 1.7 percent from their last settlement to $45.75 by 0453 GMT. International Brent crude futures were down 0.8 percent, or 46 cents, at $54.45 a barrel.
Gold prices inched up on Thursday as a dip in Asian equities and worries about a sharp global economic slowdown propelled demand for safer investments. Spot gold gained about 0.2 percent to $1,286.62 per ounce at 0107 GMT, having earlier touched its highest since June 15 at $1,290.09. U.S. gold futures were up 0.4 percent at $1,288.80 per ounce.
Treasuries Recap
The yield on U.S. 10-year treasuries fell to 2.63 percent, the lowest in nearly a year on Wednesday.
