Dagelijkse Markt Analyse 11 Januari 2019

DAGELIJKSE MARKT ANALYSE 11 DECEMBER 2018

• Brexit vote cancellation shifts the spotlight to Italian budget woes
• Euro may decline amid uncertainty before Conte, Juncker meeting
• Japanese Yen might rise as S&P 500 futures signal risk aversion

European politics remain in focus despite the cancellation of a fateful vote on the Brexit deal negotiated by UK Prime Minister Theresa May. Parliament was due to take up the agreement today but the government backed off as it because clear it would not have the votes to succeed.

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DAGELIJKSE MARKT ANALYSE 12 DECEMBER 2018

• US Dollar may rise as CPI data helps boost Fed rate hike outlook
• Euro vulnerable amid lingering political turmoil in Italy, France
• Italian PM Conte, EC’s Juncker meeting eyed before EU summit

A barebones offering on the European economic data front puts politics back into the spotlight, with all eyes on a meeting between Italian Prime Minister Giuseppe Conte and European Commission President Jean-Claude Juncker. They will try to iron out a lingering budget dispute before Thursday’s EU leaders’ summit.

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DAGELIJKSE MARKT ANALYSE 13 DECEMBER 2018

• EURUSD has been weakening persistently since early 2018 and those losses could extend further as France joins Italy in potentially breaking the EU’s fiscal rules.
• The Euro outlook against other currencies is poor too.

The outlook for the Euro in the weeks ahead is looking bleak after French President Emmanuel Macron was forced to react to the gilets jaunes (yellow vest) protests by raising wages and cutting taxes – moves that could breach the EU’s fiscal rules by lifting the French budget deficit above the EU limit of 3.0% of GDP.

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DAGELIJKSE MARKT ANALYSE 14 DECEMBER 2018

• Yen up, Aussie and NZ Dollars down as stocks plunge in APAC trade
• S&P 500 futures hint risk aversion likely to continue through week-end
• US retail sales data may pass unnoticed with FOMC meeting in focus

The sentiment-linked Australian and New Zealand Dollars fell alongside stocks while the anti-risk Japanese Yen rose as investors’ mood darkened in Asia Pacific trade. An MSCI gauge tracking regional performance shed more than 1 percent.

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DAGELIJKSE MARKT ANALYSE 17 DECEMBER 2018

• Yen falls, Aussie and Kiwi Dollars rise in risk-on Asia Pacific trade
• S&P 500 futures hint the upbeat mood has scope for follow-through
• Euro unlikely to find a potent catalyst in revised Eurozone CPI data

The sentiment-geared Australian and New Zealand Dollars narrowly outperformed while the anti-risk Japanese Yen edged lower as Asia Pacific markets started the week in a relatively upbeat mood, shrugging off a negative lead from Friday’s Wall Street session. Bellwether S&P 500 futures are pointing higher, hinting at more of the same in the hours ahead.

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DAGELIJKSE MARKT ANALYSE 18 DECEMBER 2018

• NZ Dollar bounces from two-week low following business confidence data
• Yen may trim APAC session gains as S&P 500 futures hint at risk-on bias
• US Dollar may fall as markets position for a dovish FOMC rate decision

The New Zealand Dollar outperformed in Asia Pacific trade, enjoying support from nominally upbeat business confidence data. The figures seemed to trigger a correction from the two-week low where the currency has been lingering after last Friday’s plunge. The Japanese Yen dutifully rose as regional stocks declined, boosting the perennially anti-risk currency.

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DAGELIJKSE MARKT ANALYSE 19 DECEMBER 2018

• US Dollar, Yen may rise as the Fed maintains a hawkish policy bias
• British Pound unlikely to find a lasting catalyst in UK inflation data
• Euro higher on hopes EU Commission will ratify Italy budget deal

The US Dollar is trading broadly lower ahead of the opening bell in Europe amid pre-positioning for the FOMC monetary policy announcement. The markets are angling for a dovish outcome. A rate hike is expected but traders envision a dovish shift in the central bank’s forecast for 2019.

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DAGELIJKSE MARKT ANALYSE 20 DECEMBER 2018

• Yen up, commodity currencies down as Fed sinks APAC stocks
• S&P 500 futures hint continued risk aversion is on the horizon
• BOE rate decision might be a non-event for the British Pound

The anti-risk Japanese Yen rose while the sentiment-geared Australian, Canadian and New Zealand Dollars fell alongside stocks in Asia Pacific trade as regional bourses picked up a negative lead from Wall Street. The move follows a Fed monetary policy announcement that proved to be far less dovish than the markets predicted (as expected). The Kiwi underperformed on soft local GDP data.

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DAGELIJKSE MARKT ANALYSE 21 DECEMBER 2018

• Yen may turn higher Washington DC turmoil stokes risk aversion
• Possible US government shutdown threatens fragile growth outlook
• UK Q3 GDP revision unlikely to mean much of the British Pound

Most major currencies marked time in quiet Asia Pacific trade, with markets seemingly enjoying a lull in high-profile scheduled event risk after two days of breakneck volatility. The Japanese Yen narrowly underperformed, retracing the prior session’s impressive gains.

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DAGELIJKSE MARKT ANALYSE 2 JANUARI 2019

First Quarter 2019 Fundamental Forecasts for the US Dollar, Euro, Oil, Equities, and More

The fourth quarter and 2018 are now in the books, and the ongoingresurgence of market volatility and uncertainty around key thematic influences are set to carry into 2019. With fundamental issues around US-led trade wars, Brexit, political uncertainty rising in Europe, emerging market contagion, among others lingering, the first three months of the New Year should produce opportunities across asset classes.

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DAGELIJKSE MARKT ANALYSE 3 JANUARI 2019

• Yen soars, Aussie Dollar falls as Apple Inc revenue cut sours sentiment
• British Pound down as UK companies prepare for “disruptive” Brexit
• S&P 500 futures suggest the risk-off mood likely to find follow-through

The anti-risk Japanese Yen soared in Asia Pacific trade after Apple Inc slashed first-quarter revenue figures. Similarly-minded Swiss Franc and US Dollar also rose while the Australian Dollar led sentiment-geared FX downward. Apple CEO Tim Cook cited an unexpectedly severe growth slowdown in emerging markets and hinted at the US-China trade war as a leading culprit behind the revenue downgrade.

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DAGELIJKSE MARKT ANALYSE 4 JANUARI 2019

• US Dollar vulnerable as soft jobs data spurs dovish Fed outlook shift
• Euro likely to overlook inflation downswing on ECB policy standstill
• Yen down, Aussie Dollar up as markets retrace Apple-linked volatility

December’s US employment data takes top billing through the end of the trading week. The report is expected to show a 184k rise in nonfarm payrolls while the unemployment rate holds at a five-decade low of 3.7 percent and wage inflation backs off a nine-year high, inching down to 3 percent on-year.

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DAGELIJKSE MARKT ANALYSE 7 JANUARI 2019

• Risk appetite swells on China RRR cut, US jobs data, dovish Fed-speak
• Testy US-China talks may fuel trade war fears, sour market mood anew
• US government shutdown, soft services ISM data amplify risk-off threat

A quiet offering on the economic data docket is likely to put sentiment trends in focus for foreign exchange markets in European trading hours. The mood is relatively upbeat at the start of the week, echoing Friday’s rosy session. Investors cheered as China cut its banks’ reserve requirement ratio (RRR), December’s US jobs data dwarfed forecasts and comments from Fed Chair Jerome Powell took a decidedly dovish turn.

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DAGELIJKSE MARKT ANALYSE 8 JANUARI 2019

• Fruitless US-China trade talks, World Bank forecast threaten markets
• Japanese Yen may fall if upbeat cues in S&P 500 futures are sustained
• US Dollar corrects higher, Canadian Dollar up on firmer BOC outlook

A dull offering of economic data might keep sentiment trends at the forefront. Bellwether S&P 500 futures are pointing higher, hinting at a risk-on lean. A weaker Japanese Yen may be the most obvious G10 FX response in such a scenario. Follow-through might be lacking however, if optimism about US-China trade talks proves to be misplaced while worries about global growth resurface.

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DAGELIJKSE MARKT ANALYSE 9 JANUARI 2019

• British Pound vulnerable as the UK Parliament debates Brexit deal
• US Dollar may rise as FOMC minutes make the case for rate hikes
• Yen down, Aussie and NZ Dollars up on US-China trade deal hopes

Brexit returns to the spotlight Wednesday as the Parliament resumes debate on the terms of the UK withdrawal from the European Union. Lawmakers handed Prime Minister Theresa May another legislative defeat yesterday, with members of her own Conservative party voting with the opposition to limit her tax-varying powers in the event of the dreaded “no-deal” divorce.

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DAGELIJKSE MARKT ANALYSE 10 JANUARI 2019

• Euro unlikely to find lasting cues in December ECB meeting minutes
• US Dollar might rise if Fed Chair Powell moderates dovish rhetoric
• Canadian Dollar down after BOC, Yen up as Japanese stocks decline

Minutes from December’s ECB policy meeting headline an otherwise lackluster economic calendar in European trading hours. The release may not offer much by way of directional guidance for the Euro considering markets have already priced out an interest rate hike in 2019.

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DAGELIJKSE MARKT ANALYSE 11 JANUARI 2019

• Tame European data docket puts US CPI data in the spotlight
• Upbeat print echoing firm wage growth may boost US Dollar
• NZ Dollar led commodity FX higher in risk-on APAC session

A tame offering on the European economic data front puts December’s US CPI data firmly in the spotlight. The core inflation rate is expected to register at 2.2 on-year, unchanged from the prior month and broadly in line with near-term trend averages.

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