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Headlines
Treasury yields rose amid stronger-than-expected U.S. economic data; the dollar reversed gains to trade with a slight loss after rising as much as 0.4% after ECB’s Draghi said he sees no convincing signs of an uptick in inflation.
ECB’s Draghi has said that there are “no convincing signs yet of upward trend in underlying inflation”. Draghi called on Germany to be calm as the ECB continues pumping stimulus into the euro area. The Governing Council left interest rates and the bondprogram unchanged. Sit tight for Trump’s inauguration as we wait for clues on whether his policies will boost growth in the US.
Mnuchin Says Long-Term Strength of U.S. Dollar Is Important. Trump’s comments on dollar being too strong not meant as longer-run policy, Treasury Secretary nominee says. USD currently is “very, very strong and what you see is people from all over the world wanting to invest in the U.S. currency”
China’s Xi, Preaching openness abroad, expands clampdown at Home.
Chinese govt warning against “false Western ideas” as Xi seeks to minimize domestic risks.
China also showing harder line on Japan and other long-time rivals U.S. Jan. Philadelphia Fed Index resulted 23.6 vs Est. 15. U.S. Weekly Jobless Claims printed 234k vs Est. 252k, it's the Second-lowest level since November 1973 U.S. Dec. Housing Starts 1,226k Annualized vs Est. 1,188k.
Multifamily-unit construction surged; applications to build detached dwellings climbed to the high since October 2007
Fx Markets
The euro fell below $1.06 during Draghi's speech, in which he described the euro zone recovery as "dampened by the sluggish pace of structural reform" and said a "very substantial degree" of monetary policy stimulus was still needed USD was little changed after reversing early gains as a rally in commodity FX weighed
Rates
Yields on 10-year Treasuries climbed 10 basis points to 2.42 percent, after falling seven on Tuesday. It was the biggest advance since Dec. 14.Similar maturity German bunds climbed 2bp to 0.38%.
Equities
The S&P 500 rose 0.2 percent to 2,271.87 at 4 p.m. in New York, 0.2 percent below its all-time high set Jan. 6
The Dow Jones Industrial Average fell 22.05 points to 19,804.72. The index is down almost 1 percent since Jan 6, when it climbed within one point of 20,000.
The MSCI Emerging Markets Index slipped 0.1 percent, after earlier rising to the highest closing level since Nov. 8
Commodities
Gold futures lost 0.7 percent, snapping a seven-day winning streak that was the longest since November.
Iron ore retreated down 1.3% to USD80.99 a tonne amid weakening demand.
Aluminium retreated from a 20-month high on take profits and expectations of increasing supply.
Copper was down 0.5% to USD5739 a tonne. Note that trading activity has already begun to thin with the Chinese New Year holiday only a week away.
Regards All.
Treasury yields rose amid stronger-than-expected U.S. economic data; the dollar reversed gains to trade with a slight loss after rising as much as 0.4% after ECB’s Draghi said he sees no convincing signs of an uptick in inflation.
ECB’s Draghi has said that there are “no convincing signs yet of upward trend in underlying inflation”. Draghi called on Germany to be calm as the ECB continues pumping stimulus into the euro area. The Governing Council left interest rates and the bondprogram unchanged. Sit tight for Trump’s inauguration as we wait for clues on whether his policies will boost growth in the US.
Mnuchin Says Long-Term Strength of U.S. Dollar Is Important. Trump’s comments on dollar being too strong not meant as longer-run policy, Treasury Secretary nominee says. USD currently is “very, very strong and what you see is people from all over the world wanting to invest in the U.S. currency”
China’s Xi, Preaching openness abroad, expands clampdown at Home.
Chinese govt warning against “false Western ideas” as Xi seeks to minimize domestic risks.
China also showing harder line on Japan and other long-time rivals U.S. Jan. Philadelphia Fed Index resulted 23.6 vs Est. 15. U.S. Weekly Jobless Claims printed 234k vs Est. 252k, it's the Second-lowest level since November 1973 U.S. Dec. Housing Starts 1,226k Annualized vs Est. 1,188k.
Multifamily-unit construction surged; applications to build detached dwellings climbed to the high since October 2007
Fx Markets
The euro fell below $1.06 during Draghi's speech, in which he described the euro zone recovery as "dampened by the sluggish pace of structural reform" and said a "very substantial degree" of monetary policy stimulus was still needed USD was little changed after reversing early gains as a rally in commodity FX weighed
Rates
Yields on 10-year Treasuries climbed 10 basis points to 2.42 percent, after falling seven on Tuesday. It was the biggest advance since Dec. 14.Similar maturity German bunds climbed 2bp to 0.38%.
Equities
The S&P 500 rose 0.2 percent to 2,271.87 at 4 p.m. in New York, 0.2 percent below its all-time high set Jan. 6
The Dow Jones Industrial Average fell 22.05 points to 19,804.72. The index is down almost 1 percent since Jan 6, when it climbed within one point of 20,000.
The MSCI Emerging Markets Index slipped 0.1 percent, after earlier rising to the highest closing level since Nov. 8
Commodities
Gold futures lost 0.7 percent, snapping a seven-day winning streak that was the longest since November.
Iron ore retreated down 1.3% to USD80.99 a tonne amid weakening demand.
Aluminium retreated from a 20-month high on take profits and expectations of increasing supply.
Copper was down 0.5% to USD5739 a tonne. Note that trading activity has already begun to thin with the Chinese New Year holiday only a week away.
Regards All.