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European Markets Closed for Extended Christmas Holiday

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Fundamental analysis of Forex market

Notes/Observations

  • Europe closed for holiday (Austria, Belgium, Croatia, Cyprus, Czechia, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Luxembourg, Malta, Netherlands, Nigeria, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, South Africa, Spain, Sweden, Switzerland, United Kingdom). In North America – Canada also closed
  • Asian equity markets were little changed in quiet trade. Volume was light with Hong Kong, New Zealand and Australia closed for Boxing Day
  • Continued optimism that US and China appeared to be moving towards concluding their phase one trade deal

Asia:

  • China Foreign Ministry spokesperson Geng Shuang reiterated stance that both sides’ economic and trade teams were in close communication about detailed arrangements for the US-China deal’s signing and other follow-up work
  • China PBOC set the Daily Yuan Reference Rate at its strongest since Aug 6th (6.9801 v 7.0067 prior )

Americas:

  • President Trump: We’ll be having a signing ceremony, yes. And we’ll be having a quicker signing because we want to get it done. The deal is done, it’s just being translated now
  • Mastercard/SpendingPulse: US Nov 1-Dec 24th overall holiday retail sales (ex autos) +3.4% y/y to $880B; e-commerce sales hit a record high

SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM

Equities

Indices [S&P 500 Futures +0.16%]

Market Focal Points/Key Themes:

Major European Indices closed in observance of Boxing day. Japan and Hong Kong markets traded firmer on continued trade optimism, whilst US Equities futures point to a slightly higher open.

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Equities

  • Materials: Norilsk Nickel [GMKN.RU] -3% (analyst action)
  • Technology: Nano Dimension [NNDM.IL] +1% (new Chairman)

Speakers

  • Russia Foreign Min lavrov said not to have high hopes of restoring US relations in 2020
  • Russia Energy Min Novak: Can finish construction of Nord Stream 2 gas pipeline within a couple of months
  • China Commerce Ministry (MOFCOM) spokesperson Gao Feng reiterated stance that govt was in close contact with US on trade

Currencies/ Fixed Income

  • FX markets were quiet with European markets closed for holiday.
  • USD/JPY was higher by 0.2% as optimism continued to peculate that US and China will sign the 1st phase of the trade agreement.
  • EUR/USD was steady at 1.1095; GBP/USD at 1.2980

Economic Data

  • (TR) Turkey Dec Real Sector Confidence (seasonally adjusted): 108.7 v 105.9 prior; Real Sector Confidence NSA (unadj): 103.6 v 102.0 prior
  • (TR) Turkey Dec Capacity Utilization: 77.0% v 77.2% prior

Fixed Income Issuance

Looking Ahead

  • (EG) Egypt Central Bank Interest Rate Decision: Expected to leave Deposit Rate unchanged at 12.25%; No analyst estimates; Current Lending Rate at 13.25%
  • 06:00 (IL) Israel Nov Chain Store Sales M/M: No est v -0.2% prior
  • 06:30 (CL) Chile Central Bank Traders Survey
  • 07:00 (US) MBA Mortgage Applications w/e Dec 20th: No est v -5.0% prior
  • 08:00 (RU) Russia Gold and Forex Reserve w/e Dec 20th (RUB): No est v $548.7B prior
  • 08:30 (US) Initial Jobless Claims: 220Ke v 234K prior; Continuing Claims: No est v 1.722M prior
  • 11:30 (US) Treasury to sell 4-Week and 8-Week Bills
  • 13:00 (US) Treasury to sell 7-Year Notes
  • 14:00 (AR) Argentina Oct Supermarket Sales Y/Y: No est v -8.8% prior; Shop Center Sales Y/Y: No est v -3.8% prior
  • 16:00 (KR) South Korea Dec Consumer Confidence: No est v 100.9 prior
  • 16:30 (US) Weekly API Oil Inventories
  • 18:30 (JP) Japan Nov Jobless Rate: 2.4%e v 2.4% prior; Job-To-Applicant Ratio: 1.57e v 1.57 prior
  • 18:30 (JP) Japan Dec Tokyo CPI Y/Y: 0.9%e v 0.8% prior; CPI Ex-Fresh Food, Energy Y/Y: 0.7%e v 0.7% prior; CPI Ex-Fresh Food Y/Y: 0.6%e v 0.6% prior
  • 18:50 (JP) BOJ Summary of Opinions
  • 18:50 (JP) Japan Nov Retail Sales M/M: +5.0%e v -14.2% prior (revised from -14.4%); Y/Y: -1.7%e v -7.0% prior (revised from -7.1%); Dept. Store, Supermarket Sales Y/Y: -1.9%e v -8.2% prior
  • 18:50 (JP) Japan Nov Preliminary Industrial Production M/M: -1.0%e v -4.5% prior; Y/Y: -8.1%e v -7.7% prior
  • 20:30 (CN) China Nov Industrial Profits Y/Y: No est v -9.9% prior
  • 21:00 (SL) Sri Lanka Central Bank (CBSL) Interest Rate Decision Expected to leave Standing Deposit Rate unchanged at 7.00%; current Standing Lending Rate at 8.00% (no estimates)
  • 22:00 (TH) Thailand Central Bank to sell combined THB60B in 3-month and 6-month Bills
  • 23:30 (TW) Taiwan to sell TWD35B in 6-month Bills