Market Roundup
- Oil declines but set for third weekly rise
- Global outlook sombre for late-cycle expansion despite market joy - Reuters poll
- UK economy's growth in third-quarter revised up, smallest current account gap since 2012
- China will push more lending to manufacturing sector next year: regulator
- Japan November factory output likely shrank on trade war impact: Reuters poll
- World stocks hit record high, as sterling endures torrid week
- UK car industry calls for tariff-free deal with EU as output slumps
Economic Data Ahead
- (0830 ET/1330 GMT) U.S Gross Domestic Product Price Index (Q3) (Forecast 1.8%, Prior 1.7%)
- (0830 ET/1330 GMT) U.S. Gross Domestic Product Annualized (Q3) (Forecast 2.1%, Prior 2.1%)
- (0830 ET/1330 GMT) U.S Core Personal Consumption Expenditures (QoQ) (Q3) (Forecast 2.1%, Prior 2.1%)
- (0830 ET/1330 GMT) U.S. Personal Consumption Expenditures Prices (QoQ) (Q3) (Forecast 1.5%, Prior 1.5%)
- (0830 ET/1330 GMT) Canada Retail Sales (MoM) (Oct) (Forecast 0.5%, Prior -0.1%)
- (0830 ET/1330 GMT) Canada Retail Sales ex Autos (MoM) (Oct) (Forecast 0.3%, Prior 0.2%)
- (0830 ET/1330 GMT) Canada New Housing Price Index (MoM) (Oct) (Forecast 0.1%, Prior 0.2%)
- (1000 ET/1500 GMT) U.S Core Personal Consumption Expenditure - Price Index (MoM) (Nov (Forecast 0.1%, Prior 0.1%)
- (1000 ET/1500 GMT) U.S Michigan Consumer Sentiment Index (Dec) (Forecast 99.2, Prior 99.2)
- (1000 ET/1500 GMT) EZ Consumer Confidence (Dec) PRELIM (Forecast -7, Prior -7.2)
Key Events Ahead
- (1000 ET/1500 GMT) UK Parliamentary Vote on Brexit
FX Beat
DXY: The US Dollar Index, which tracks the greenback's value against a basket of six major currencies holds steady near multi-day tops amid firmer Treasury yields. DXY ignored Doji formation on the previous day's candle. Technical bias remains bullish.
EUR/USD: The single currency trades lower against a strong Greenback ahead of key U.S. data. Downbeat German Gfk Consumer Confidence Survey for January also dent the euro. Repeated failure on the part of the bulls to force a convincing break above 200-DMA reinforces bearish pressure. EUR/USD was trading 0.24 percent lower at 1.1093 at around 11:20 GMT. The major is holding support at 21-EMA at 1.1093. Break below will drag the pair lower.
USD/CHF: USD/CHF bounces off from multi-month lows at 0.9770 and was trading 0.25 percent higher at 0.9806 at around 11:20 GMT. Major risk aversion tone across the markets kept demand for safe-haven assets, buoying the franc and dragging the pair lower. Major trend is bearish, but oversold oscillators may see some pullback in the pair. Support lies at lower weekly Bollinger band at 0.9733, while, 5-DMA is immediate resistance at 0.9803.
GBP/USD: The GBP/USD recovers from 2-week lows at 1.2989 after the UK Q3 Final GDP data bettered expectations, with +0.4 percent QoQ. The pair has paused upside short of the 1.3050 handle as market await the House of Commons’ vote on the UK PM’s Johnson's Brexit bill. GBP/USD was trading at 1.3028 at around 11:45 GMT, up 0.15% at the time of writing. The pair has retraced below 200W MA and recovery finds stiff resistance at 1.3069 (nearly converged 20-DMA and 21-EMA). Major trend is bullish and break above 1.3070 could see further gains. Close below 200W MA will add bearish pressure.
USD/JPY: USD/JPY was trading largely muted at around 11:50 GMT. The major finds strong resistance at 200W MA at 109.75. Break above required for further gains. Focus on US GDP and Core PCE Price index for fresh impetus. An upbeat Fed’s preferred inflation measure and Personal Spending figures could have a significant impact on the dollar trades. 21-EMA is immediate support at 109.09. Break below 200-DMA (108.73) negates bullish bias.
Equities Recap
European stocks surge on Friday's trade. At around 11:55 GMT, The Stoxx Europe 600 was up 0.66% at 417.46. The German DAX gained 0.69% to 13,302.75.
The French CAC 40 was up 0.59% at 6,007.31 and the U.K. FTSE 100 was up 0.21% at 7,590.05.
Commodities Recap
Gold edged lower through the European session, failed to build on the overnight positive momentum. Spot gold was trading 0.08% lower on the day at 1477.56 at 11:55 GMT.
WTI pauses a six-day winning streak, trades marginally lower at 60.91 at 11:55 GMT. Brent crude oil was down 0.34% at 66.31.
Treasuries Recap
U.S.: The U.S. Treasuries slumped during Friday’s afternoon session ahead of the country’s gross domestic product (GDP) for the third quarter of this year, scheduled to be released today by 13:30GMT. Also, investors are eyeing to wrap up their positions before the upcoming long Christmas and New Year holidays at least until the first week of January. The yield on the benchmark 10-year Treasury yield jumped nearly 2 basis points to 1.926 percent, the super-long 30-year bond yield gained 1 basis point to 2.356 percent and the yield on the short-term 2-year traded 1-1/2 basis points higher at 1.636 percent.
EUR: The German bunds remained flat during early European session of the last trading day of the week Friday amid a silent trading day that witnessed data of little economic significance after the country’s GfK consumer climate index for the month of January, disappointed market sentiments ahead of a long-awaited Christmas week holiday. The German 10-year bond yield, which move inversely to its price, hovered around -0.233 percent, the yield on 30-year note remained flat at 0.289 percent while the yield on short-term 2-year barely slipped 1 basis point to -0.637 percent.
JGBs: The yield on 10-year Japanese government bonds hit 1-week high on Friday following upbeat comments from Bank of Japan Governor Haruhiko Kuroda. He said that global outlook has brightened somewhat due to preliminary U.S.-China trade deal. At the time of writing, the yield on the benchmark 10-year JGB note, which moves inversely to its price, rose nearly 1 basis point to 0.007 percent, the yield on the long-term 30-year climbed 1-1/2 basis points to 0.435 percent and the yield on short-term 2-year remained steady at -0.099 percent
AUS: The Australian 10-year bond yield hit 5-week high during early Asian session on Friday as the U.S.-China trade deal optimism flooded investor positive sentiments. However, no domestic data out in Australia today, markets remained muted. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, jumped 7 basis points to 1.297 percent, the yield on the long-term 30-year bond also surged 7 basis points to 1.906 percent and the yield on short-term 2-year gained nearly 6 basis points to 0.877 percent.
