Market Roundup
•US Richmond Manufacturing Index (Dec) -10, -10 forecast, -14 previous
•US Richmond Manufacturing Shipments (Dec) -11, -12 previous
•US Richmond Services Index (Dec) 23, 9 previous
•US Atlanta Fed GDPNow (Q4) 3.1%, 3.1% forecast, 3.1% previous
•US 5-Year Note Auction 4.478%, 4.197% previous
Looking Ahead Economic Data(GMT)
•No Data Ahead
Looking Ahead Events And Other Releases(GMT)
• No Events Ahead
Currency Summaries
EUR/USD: The euro eased on Tuesday as dollar was buoyed by firmer Treasury yields and speculation that the Federal Reserve would slow its easing in 2025. Investors are taking direction from last week's 25 basis point Fed interest rate cut, its signals on the strength of the economy and its slow progress bringing inflation down to its 2% target. Markets are now pricing in about 35 basis points of easing for 2025, implying one quarter-point rate cut and around a 40% chance of a second. Most financial centers around the world are closed on Wednesday for Christmas. The U.S. reopens on Thursday, while many financial centers have a second day off. The euro eased 0.15% to $1.0389. Immediate resistance can be seen at 1.0399(38.2%fib), an upside break can trigger rise towards 1.0438(50%fib).On the downside, immediate support is seen at 1.0346(23.6%fib), a break below could take the pair towards 1.0300(Psychological level)
GBP/USD: Sterling eased against the dollar on Tuesday as markets began winding down for the Christmas break. The U.S. dollar has dominated the currency market in 2024, buoyed by a resilient economy and the Federal Reserve's limited room to further cut interest rates.The Bank of England (BoE) met last week and kept interest rates unchanged at 4.75%. With the exception of the Norges Bank, the BoE has reduced rates the least this year among major central banks, making only a half-point cut in borrowing costs, compared to a full percentage point from the Fed and 175 basis points from the Bank of Canada. Looking ahead, attention is now shifting to key global events in 2025, particularly the potential return of Donald Trump to the White House, which could prompt central banks to adopt a more cautious approach to monetary policy. Immediate resistance can be seen at 1.2690(38.2%fib), an upside break can trigger rise towards 1.2731 (Dec 18th high).On the downside, immediate support is seen at 1.2560(23.6%fib), a break below could take the pair towards 1.2524(Lower BB)
USD/CAD: The Canadian dollar edged higher against the U.S. dollar on Tuesday as investors awaited further clarity on Canadian Prime Minister Justin Trudeau's position. Trudeau, whose party is expected to lose power early next year, is facing growing pressure from his own lawmakers to step down and allow a successor to take the reins. Meanwhile, the price of oil, one of Canada's key exports, recovered from the previous session's losses, with U.S. crude oil futures rising 1.3% to $70.17 a barrel. The loonie was trading 0.1% higher at 1.4356 against the U.S. dollar, fluctuating between 1.4364 and 1.4419. Last Thursday, the currency had reached its weakest intraday level since March 2020 at 1.4467, weighed down by concerns over potential U.S. trade tariffs, a more hawkish Federal Reserve, and domestic political uncertainty. Immediate resistance can be seen at 1.4429(23.6% fib), an upside break can trigger rise towards 1.4480 (Higher BB).On the downside, immediate support is seen at 1.4323(38.2%fib), a break below could take the pair towards 1.4228(50%fib).
USD/JPY: The U.S. dollar traded in tight range against yen on Tuesday as traders were on alert to any intervention from Japanese authorities. Japan's Finance Minister Katsunobu Kato on Tuesday reiterated Tokyo's discomfort with excessive foreign exchange moves and put speculators on notice that authorities are ready to act to stabilise a faltering yen. Kato last week explicitly described the currency market situation as alarming, signaling the government's heightened concerns over the sliding yen. Japan last intervened in the currency markets in July, conducting a yen-buying operation to support the currency after it dropped to a 38-year low, falling below 161 yen per dollar . Immediate resistance can be seen at 157.37 (Higher BB) an upside break can trigger rise towards 158.81 (23.6%fib). On the downside, immediate support is seen at 155.60(38.2%fib) a break below could take the pair towards 155.00 (Psychological level).
Equities Recap
European stocks inched higher on Tuesday, although trading was subdued due to the shortened holiday week.
UK's benchmark FTSE 100 closed up by 0.42 percent, Germany's Dax closed down by 0.18 percent, France’s CAC closed up by 0.14 percent.
Wall Street's major indexes finished higher on Tuesday, supported by gains in megacap and growth stocks, during a shortened Christmas Eve trading session.
Dow Jones closed up by 0.91% percent, S&P 500 closed up by 1.10% percent, Nasdaq settled up by 1.35% percent.
Commodities Recap
Gold prices edged higher in quiet holiday trading on Tuesday, with investors focusing on the US Federal Reserve's rate plans for the coming year and President-elect Donald Trump's potential tariff policies.
Spot gold rose 0.1% to $2,614.66 per ounce at 1037 GMT, while US gold futures held steady at $2,629.00.
Oil prices climbed more than 1% on Tuesday, recovering from the previous session's losses, as a more positive short-term outlook emerged, driven by the prospect of slightly tightening supplies with thinner trading volumes ahead of the Christmas and Hanukkah holidays.
Brent crude futures settled at $73.58, up 95 cents, or 1.3%, while U.S. West Texas Intermediate (WTI) crude futures ended at $70.10, rising 86 cents, or 1.2%.
