Asian equities fell, after the S&P 500 Index slid the most since October amid thin trading volumes. The dollar weakened earlier today while the benchmark 10yr Treasury yield fell below the 2.50% mark for the first time since Dec 14th. Gold extended gains, while oil slipped.
- US President Obama phoned his successor, Donald Trump, after the latter accused Obama of hobbling the transition to his administration in a tweet that alleged unspecified “inflammatory” statements and “roadblocks”.
- Trump had earlier erupted on Twitter with attacks on actions and statements by the president, primarily in regard to Obama’s direction that the US abstain from a UN Security Council vote declaring Israeli settlements in the West Bank illegal. By declining to veto the resolution, the US allowed it to pass unanimously, enraging Israeli Prime Minister Benjamin Netanyahu.
- US Secretary of State John Kerry said the chances of peace in the Middle East are increasingly at risk after Israel’s government backed the expansion of settlements in the West Bank, contrary to both sides’ stated goal of fostering a “two-state solution” to the conflict.
- Pending home sales in November slipped 2.5% from a month earlier, faring worse than the expected 0.5% gain.
- A Conference Board index tracking Americans who expect shares to rise surged 45% in December, data showed Tuesday.
- The Dow Jones Industrial Average index climbed failed to reach the 20,000 milestone mark, climbing to within 30 points before slipping below 19,900.
- The S&P 500 Index fell 0.8%, led by real-estate shares; all main 11 groups ended lower.
- The US dollar traded at its strongest level in more than a decade last night, before erasing and reversing earlier this morning. The Bloomberg Dollar Spot Index, which tracks the greenback against 10 major peers, was 0.3% weaker during Asia trading today.
- The benchmark 10yr Treasury slipped 5bps to 2.51% in New York, and a further 2bps to 2.49% earlier this morning.
- China’s Ministry of Commerce concluded a key annual conference without setting a 2017 target, which suggests that top policy makers are backing away from an “obsession” with growth targets, the state-run Shanghai Securities News reported.
- This would mark the second year leaders have elected not to announce a trade growth target as the country continues to push for greater economic stability, choosing to focus on curbing risks instead.
- Chinese stocks earlier today fell toward a 2 month-low, led by energy and consumer staples, amid concern tighter monetary policy will weigh on earnings. The benchmark equity has fallen almost 5% in December as surging funding costs spurred a record selloff in the nation’s debt and investors sought alternatives to yuan-denominated assets.
- Spot gold gained by as much as 0.8% earlier today to $1,148.30/Oz, as the precious metal looks likely to test the $1,150/Oz resistance again.
- Gold’s support level below comes in at $1,125/Oz.
- Spot silver advanced as well, rising 1.6% to $16.1274/Oz, as the metal neared a one week-high.
- Crude oil for February delivery closed 0.3% higher at $54.06/bbl, its highest in more than 17 months, before slipping back below the $54/bbl handle earlier today, after an industry report was said to show US crude stockpiles climbed last week.
- Spot 1.4494
- USDSGD recorded a fresh high of 1.4537, before reversing gains back below the 1.4500 handle. The currency pair was 0.2% lower at 1.4493 earlier on the back of US dollar weakness today.
- Support can be found below at the 1.4400 and 1.4150 levels.
- Spot 0.7194
- AUDUSD rebounded off its 0.7145 support level, and was 0.2% higher back at the 0.7200 handle, amid a weaker US dollar and higher iron ore prices today.
- AUDUSD trimmed some of its overnight losses, gaining 0.3% to 0.7209 earlier this morning.
- Spot 1.3543
- USDCAD reached a record 10 month-high of 1.3599 last night, before reversing 0.2% lower to 1.3540 earlier today.
- The key resistance at 1.3600 remains after a slew of poorer-than-expected economic data over the past 2 weeks, including manufacturing sales, GDP and CPI, coupled with the recent Fed interest-rate hike, propelled the currency pair 3.8% higher from the 1.3100 handle.
- Spot 6.9844
- The PBOC left its fixing little changed earlier, from 6.9495 to 6.9497 today.
- USDCNH gained 0.3% to 6.9873, while USDCNY remained little changed.
- The psychological resistance of 7.0000 looks likely to be tested soon for USDCNH.
- Spot 116.85
- The yen strengthened to near its 2 week-high against the dollar, leading major currencies gains against the greenback.
- USDJPY was lower by 0.9% to 116.68.
- The 116.00 level is the next support level likely to be tested.
- Spot 1.2239
- GBPUSD was little changed, paring its earlier drop to 1.2200.
- The pound has weakened about 3.8% against the dollar over the past three weeks as uncertainty around the Brexit process continues to weigh on the currency.
- The next support below comes in at 1.2090.