17 Dec 2018

Daily Market View


Daily Market View

Monday, December 17, 2018
          U.S Stock Market

 

DJIA S & P 500 NASDAQ
24123 2605.00 6621.50
-2.02% -1.91% -2.26%

U.S stocks closed at their lowest level since April, with Treasuries rising alongside the yen, as mounting concern over the health of the global economy overshadowed positive trade developments and signs of strength from the American consumer. The S&P 500 Index tumbled 1.9 percent Friday, after testing February lows, erasing the week’s gains. Health-care and technology stocks were among the biggest decliners. The Dow Jones Industrial Average sank almost 500 points, led by Johnson & Johnson’s biggest rout in years amid mounting legal peril. Retailers retreated even after monthly data indicated U.S. consumers are still spending. Oil and gold fell. The sour mood on Wall Street came after equities slumped from Asia to Europe on concern that Chinese growth is slowing. President Donald Trump attributed the latest data to his trade war, even suggesting a deal could come soon. Investors took little solace in that, and earlier signs that trade tension was easing didn’t do much to calm nerves. The Federal Reserve holds its final policy meeting of 2018 on Tuesday and Wednesday.

 

 

Major Economic Releases for Today
Period Event GMT Forecast Previous

dec

U.K Rightmove House Prices (YoY) 00:01    

dec

Switzerland Domestic Sight Deposits 09:00    

oct

Euro-Zone Trade Balance (euros) 10:00    

nov

Euro-Zone Consumer Price Index (YoY) 10:00   2.2%

dec

Canada International Securities Transactions 13:30    

dec

U.S Empire Manufacturing 13:30    

nov

Canada Existing Home Sales (MoM) 14:00    

dec

U.S NAHB Housing Market Index 15:00    

oct

U.S Net Long-term TIC Flows 21:00    
Dow Jones Industrial Average

The Dow fell sharply on Friday, ending the week on a bleak note and sending the index into correction territory after a batch of weaker-than-expected economic data out of China and Europe sparked fresh worries about the state of the world’s second-biggest economy and prospects for global growth. The Dow fell 496.87 points, or 2%, for its lowest close since May 3. The drop left the Dow more than 10% below its Oct. 3 record high, meeting the widely used definition of a correction. The blue-chip gauge joined the S&P 500 and the NASDAQ in correction territory. Fresh evidence that global trade tensions are hitting the world’s second-biggest economy emerged Friday.

 

NASDAQ 100

The tech heavy NASDAQ dropped 58.59 points, or 0.8%, marking its lowest close since Nov. 20. Shares of Costco Wholesale Corp. fell 8.6%, after a Thursday evening earnings release showed the retailer missed revenue expectations for the fiscal first quarter. Adobe Inc. stock fell more than 7%, after the software company missed earnings expectations for the fourth quarter. Retail sales rose 0.2% in November from the month previous, surpassing expectations of a 0.1% jump.

Oil

Oil traders will stay fixated on global growth prospects in the week ahead, after prices got hammered last week by worries that the ongoing U.S-China trade dispute will drag on global growth and, by extension, erode energy demand. West Texas Intermediate crude tumbled $1.38, or roughly 2.6%, on Friday to settle at $51.20 a barrel by close of trade on the New York Mercantile Exchange. For the week, WTI prices lost about 2.7%. With just about two weeks to the end of 2018, WTI remains down about 15% on the year and some 32% lower from four-year highs of nearly $77 per barrel hit in early October. Brent is down about 10% on the year and nearly 32% lower from four-year highs of nearly $87 per barrel hit two months ago. Fresh weekly data on U.S. commercial crude inventories to gauge the strength of demand in the world’s largest oil consumer and whether output levels will continue to rise will capture the market’s attention this week.

 

 

Precious and Base Metals

Gold eased for the second straight session to hit a one-week low on Friday as the dollar rose, putting the metal on track to post its biggest weekly fall in five ahead of the U.S Federal Reserve’s interest rate decision next week. Spot gold was 0.3 percent lower at $1,238.29 per ounce. Earlier in the session, prices hit their lowest since Dec. 6 at $1,236.80. The metal is down about 0.8 percent so far this week. U.S. gold futures were down 0.4 percent at $1,242.20 per ounce. The dollar gained as investors turned nervous about an economic slowdown in China and was further supported by weakness in the euro and pound. A firm dollar makes gold more expensive for holders of other currencies. It seems to be a broader market sentiment as there is a drop across the precious complex. The dollar has strengthened and that’s being reflected in gold’s downward movement. Markets are awaiting the Federal Open Market Committee (FOMC) meeting on Dec. 18-19, where the U.S. central bank is widely expected to raise interest rates for the fourth time this year. The more interesting aspect would be what the indications are from the Fed for their plans for 2019 as we’ve seen a shift in market expectations on how much tightening we might see next year, so comments leading to that situation would be keenly watched. Gold has fallen around 9 percent since April, hit by rising U.S. interest rates and as investors chose the dollar as a safe haven rather than gold amid the U.S.-China trade dispute. Bullion is also on track to post an annual decline of about 5 percent, after rising for the previous two years. However, analysts are more optimistic on gold in 2019. Among other precious metals, spot palladium eased 1.2 percent to $1,245.30 per ounce, having hit an all-time high of $1,269.25 in the previous session. The metal was on track for its third week of gains, with prices up about 1.2 percent so far. Silver fell 1.1 percent to $14.60 per ounce.

 

 

 

Traditional Agricultures

Soybean futures fell on Friday for a second session as traders reacted to smaller-than-expected purchases this week by China coupled with ballooning global supplies. Corn futures firmed on prospects for China to start buying U.S supplies of the yellow grain, while wheat declined from a two-month high.

 

 

 

Futures Settlement Price Friday, December 14, 2018
Instrument Contract Open High Low Settlement Net Change
DJIA DJM18 24607 24626 24054 24123 -450
S & P 500 SPM18 2649.25 2652.5 2597.25 2605 -42.75
NASDAQ 100 NDM18 6774.25 6785.75 6608.5 6621.5 -152.5
Hang Seng HSH18 26208 26234 26016 26035 -492
Nikkei 225 NKH18 21625 21685 21270 21315 -475
FTSE 100 FTH18 6757.5 6801 6721.5 6735 -113
Gold GCJ18 1246 1247 1236.2 1240.8 -5.2
Silver SIK18 1481 1482.5 1454.5 1463 -19
Copper HGK18 276.75 277 272.8 275.8 -0.95
Crude Oil CLK18 52.78 52.91 50.81 51.3 -1.52
Wheat WK18 534.75 537.5 527.5 529.75 -5.75
Soybeans SK18 906.5 909.75 900 900 -6.5
Corn CK18 383.25 387 382.75 384.25 0.5

 

 

Daily Swings  (The Pivot Levels)
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
DJM18 23337 23696 23909 24268 24481 24840 25053
SPM18 2528.75 2563.00 2584.00 2618.25 2639.25 2673.50 2694.50
NDM18 6380.83 6494.67 6558.08 6671.92 6735.33 6849.17 6912.58
HSH18 25738 25877 25956 26095 26174 26313 26392
NKH18 20747 21008 21162 21423 21577 21838 21992
FTH18 6624.50 6673.00 6704.00 6752.50 6783.50 6832.00 6863.00
GCJ18 1224.87 1230.53 1235.67 1241.33 1246.47 1252.13 1257.27
SIK18 1422.83 1438.67 1450.83 1466.67 1478.83 1494.67 1506.83
HGK18 269.20 271.00 273.40 275.20 277.60 279.40 281.80
CLK18 48.34 49.57 50.44 51.67 52.54 53.77 54.64
WK18 515.67 521.58 525.67 531.58 535.67 541.58 545.67
SK18 887.00 893.50 896.75 903.25 906.50 913.00 916.25
CK18 378.08 380.42 382.33 384.67 386.58 388.92 390.83

 

 Source: – News & Quotes (Courtesy:  Reuters)                                                                    

Disclaimer

This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.

The firm or its staff members may trade on their own account and may from time to time hold or act as market makers in investments mentioned in this document. Please note that the firm makes no warranty, expressed or implied, as to the accuracy or completeness of the information and opinions herein. All parties are advised to seek independent professional advice as to the suitability of any products and to their tax, accounting, legal or regulatory implications. City Credit Capital (UK) Ltd is authorized and regulated by the Financial Conduct Authority, reg 232015.

 

 

 

17 Dec 2018

FOREX Newsletter

FOREX Newsletter

December 17, 2018

 

Pulse of the Market

·      The Dollar was higher on Friday as investors turned their focus to the expected Fed rate increase

·      It seems unlikely that May’s party will support her agreement with Brussels on leaving the EU

·      The Euro weakened as the euro zone economy showed more signs of a slowdown

·      The Canadian Dollar lost ground against its broadly stronger U.S counterpart on Friday

 

 

The U.S Dollar shone on Friday, reaching a 19-month high against a basket of currencies, as investors preferred the safety of the world’s reserve currency in the wake of worrisome political and economic news outside the United States. The Chinese Yuan fell after data showed retail sales grew in November at their slowest pace since 2003 and industrial output rose the least in nearly three years. The offshore Yuan shed 0.38 percent at 6.9038 per dollar. The euro weakened as the euro zone economy showed more signs of a slowdown. Sterling tumbled as traders worried British Prime Minister Theresa May was struggling to secure assurances from the EU over her Brexit withdrawal deal. The dollar is not so much rallying as much as everyone else is falling. The greenback’s appeal increased in the aftermath of upbeat data on domestic retail sales and industrial output. The Dollar’s gains were limited by bets the Federal Reserve might reduce the number of interest rate increases after a widely expected hike next week. The futures market implied traders saw an 82 percent chance the U.S central bank would increase key short-term rates by a quarter point to 2.25-2.50 percent at its policy meeting next Tuesday and Wednesday, up from 79 percent on Thursday. The market is skeptical about the U.S. economy and whether the Fed would hike further after December. The greenback was also held back by the probability of a partial government shutdown as U.S. President Donald Trump and federal lawmakers disagree over funding for a border wall, analysts said. The euro was down 0.5 percent at $1.12965 after German data showed private-sector expansion slowed to a four-year low in December. French business activity unexpectedly contracted, further fanning fears about slowing growth in the euro area. Worries about the European economy were also stoked by uncertainty whether May could convince the British parliament to approve her Brexit deal. The Canadian Dollar lost ground against its broadly stronger U.S. counterpart on Friday as investors worried about signs of slower global growth and braced for a potential interest rate hike next week from the Federal Reserve. Weak data from China and Europe stoked fears of a global economic slowdown, pressuring stocks and the price of oil, one of Canada’s major exports. U.S. crude oil futures settled 2.6 percent lower$51.20 a barrel.

 

Time(GMT)   Economic Release IMP Actual Forecast Prior
00:01 U.K Rightmove House Prices (YoY) (DEC) Medium      
04:00 Japan Tokyo Condominium Sales (YoY) (NOV) Low      
09:00 Switzerland Total Sight Deposits CHF (DEC 14) Low      
10:00 Euro-Zone Trade Balance (euros) (OCT) Low      
10:00 Euro-Zone Consumer Price Index (YoY) (NOV) Medium     2.2%
13:30 Canada International Securities Transactions (Canadian dollar) (OCT) Low      
13:30 U.S Empire Manufacturing (DEC) Low      
14:00 Canada Existing Home Sales (MoM) (NOV) Medium      
15:00 U.S NAHB Housing Market Index (DEC) Medium      
21:00 U.S Net Long-term TIC Flows (OCT) Medium      

 

Euro

The single currency weakened as the euro zone economy showed more signs of a slowdown. The euro was down 0.5 percent after German data showed private-sector expansion slowed to a four-year low in December. French business activity unexpectedly contracted, further fanning fears about slowing growth in the euro area. Overall, the EUR/USD traded with a low of 1.1268 and a high of 1.1363 before closing the day around 1.1300 in the New York session.

 

Yen

The Japanese Yen pair closed lower on Friday as extreme weakness in the global equity markets encouraged investors to seek shelter in the safe-haven Japanese Yen. Sellers hit the equity markets hard early in the session following the release of weaker-than-expected retail sales and industrial production from China. Overall, the USD/JPY traded with a low of 113.19 and a high of 113.65 before closing the day around 113.34 in the U.S session.

 

British Pound

The British Pound continues to slide during trading on Friday, as the relief rally after Teresa May avoided a no-confidence vote has been completely wiped out. She went to Brussels, and they offered her nothing in return. The odds of a hard Brexit are increasing by the day. Ultimately, I think that the market continues to offer short-term selling opportunities. Overall, the GBP/USD traded with a low of 1.2527 and a high of 1.2662 before closing the day at 1.2578 in the New York session.

 

Canadian Dollar

The Canadian Dollar lost ground against its broadly stronger U.S counterpart on Friday as investors worried about signs of slower global growth and braced for a potential interest rate hike next week from the Federal Reserve. It has been a risk-off day for sure and that ties into the weaker-than-expected Chinese data. Overall, USD/CAD traded with a low of 1.3344 and a high of 1.3399 before closing the day at 1.3389 in the New York session.

 

Australian Dollar

The Australian Dollar plunged on Friday on concerns about a weakening economy in China and Europe. The selling was fueled by safe-haven flows into the U.S Dollar as risk appetite weakened following softer-than-expected economic data from China and the Euro Zone. China released reports showing economic activity in the world’s second largest economy mostly slowed in November. Overall, AUD/USD traded with a low of 0.7149 and a high of 0.7226 before closing the day at 0.7174 in the New York session.

Euro-Yen

EUR/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is issuing a bullish stance. The Relative Strength Index is above 45 and lies below the neutral zone. In general, the pair has lost 0.73%.

 

Sterling-Yen

Currently, GBP/JPY is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish tone and MACD is indicating a bearish stance. The Relative Strength Index is above 40 reading and lies below the neutral zone. On the whole, the pair has lost 0.84%.

 

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 45 reading and lies above the neutral region. In general, the pair has lost 0.90%.

 

Euro-Sterling

This cross is currently trading above 14, 50 and below 100 days moving average. Fast stochastic is indicating a bearish tone and MACD is issuing a bullish signal. The Relative Strength Index is above 59 and lies above the neutral region. On the whole, the pair has gained 0.10%.

 

Sterling-Swiss

This cross is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is indicating a bearish tone. The Relative Strength Index is above 38 and lies below the neutral region. In general, the pair has lost 0.15%.

 

Appendix

  

FOREX Closing Prices for December 14, 2018
Currency Open High Low Close Net Chg
EUR/USD 1.13607 1.13635 1.12684 1.13008 -0.0055
USD/JPY 113.58 113.656 113.195 113.348 -0.2490
GBP/USD 1.26541 1.26623 1.25277 1.25782 -0.0080
USD/CHF 0.99387 0.99876 0.99321 0.99871 0.0049
USD/CAD 1.33473 1.33992 1.33448 1.3389 0.0038
EUR/JPY 129.055 129.111 127.961 128.106 -0.9420
GBP/JPY 143.763 143.837 142.352 142.592 -1.2110
CHF/JPY 114.257 114.335 113.454 113.462 -0.7940
AUD/JPY 82.069 82.112 81.22 81.325 -0.7410
EUR/GBP 0.89738 0.9003 0.89593 0.8982 0.0009
EUR/CHF 1.12914 1.12925 1.12395 1.12873 -0.0005
GBP/CHF 1.2579 1.25853 1.2497 1.25634 -0.0019

 

 

Daily Pivot Points
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.1163 1.1216 1.1258 1.1311 1.1353 1.1406 1.1449
USD/JPY 112.68 112.94 113.14 113.40 113.60 113.86 114.07
GBP/USD 1.2382 1.2455 1.2517 1.2589 1.2651 1.2724 1.2786
USD/CHF 0.9895 0.9913 0.9950 0.9969 1.0006 1.0024 1.0061
USD/CAD 1.3302 1.3323 1.3356 1.3378 1.3411 1.3432 1.3465
EUR/JPY 126.52 127.24 127.67 128.39 128.82 129.54 129.97
GBP/JPY 140.53 141.44 142.02 142.93 143.50 144.41 144.99
CHF/JPY 112.28 112.87 113.17 113.75 114.05 114.63 114.93
AUD/JPY 80.10 80.66 80.99 81.55 81.88 82.44 82.78
EUR/GBP 0.8916 0.8938 0.8960 0.8981 0.9004 0.9025 0.9047
EUR/CHF 1.1201 1.1220 1.1254 1.1273 1.1307 1.1326 1.1360
GBP/CHF 1.2424 1.2460 1.2512 1.2549 1.2600 1.2637 1.2688

 

Sources:  News, Charts & Quotes (Courtesy: Reuters, US Department Of Treasury)

 

Disclaimer

This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.

The firm or its staff members may trade on their own account and may from time to time hold or act as market makers in investments mentioned in this document. Please note that the firm makes no warranty, expressed or implied, as to the accuracy or completeness of the information and opinions herein. All parties are advised to seek independent professional advice as to the suitability of any products and to their tax, accounting, legal or regulatory implications. City Credit Capital (UK) Ltd is authorized and regulated by the Financial Conduct Authority, reg 232015.