The last day of trading before the Christmas holidays and a Japanese holiday kept activity very subdued in today’s Asian session with early closes for some markets and an almost barren data calendar. Data releases were confined to Singapore’s CPI and industrial production which are scheduled for release just as we go to press.
Currency markets were slightly more volatile overnight with ranges widened amid a slew of mixed data. The EUR ran into resistance above 1.31 after an early run-up with the customary French downgrade rumour among the factors standing in front of the rally. But activity was light and we eventually settled mid-range and Asia’s open was at the same level as yesterday.
The slew of US data releases were a mixed bag, but generally continued the recent spate of better than expected numbers. The fly in the ointment was a surprise downward revision to Q3 US growth – down to 1.8% q/q from 2.0% previously – and a slump in the Chicago Fed activity index to -0.37 in November from -0.11 but all other data held a more positive tone. The weekly jobless claims fell to the lowest level since April 2008 reflecting better labour conditions while the final Michigan confidence index for December was pushed higher to 69.9 from 67.7. The weekly consumer comfort index improved to -45 from -49.9 and economic expectations rose to -17 from -32 (its best reading since May). Finally, leading indicators were better than expected at +0.5% but below last month’s 0.9%. The better data encouraged a mild Wall St rally though volumes were thin. The DJIA rallied 0.51%, S&P 0.83% and the same for the Nasdaq.
Today’s European session has only data out of the UK – house loans and index of services. North America has another relatively busy slate with US durable goods orders, personal income/spending, the PCE data and new home sales. Canada’s GDP data for October is also scheduled.
It just remains to wish you all a very merry Christmas!
Data Highlights
US Nov. Chicago Fed Activity Index out at -0.37 vs. -0.17 expected and revised -0.11 prior
US Q3 GDP Revision out at +1.8% q/q vs. 2.0% expected and 2.0% prior
US Initial Jobless Claims out at 364k vs. 380k expected and revised 368k prior
US Continuing Claims out at 3546k vs. 3600k expected and revised 3625k prior
US Bloomberg Consumer Comfort Index out at -45.0 vs. -49.9 prior
US Dec. Bloomberg Economic Expectations Index out at -17 vs. -32 prior
US Dec. Final Michigan Confidence Index out at 69.9 vs. 68.0 expected and 67.7 prior
US Nov. Leading Indicators out at +0.5% m/m vs. 0.3% expected and 0.9% prior
US Oct. House Price Index out at -0.2% m/m vs. +0.2% expected and revised +0.4% prior
NZ Nov. M3 Money Supply out at +6.5% y/y vs. 5.5% prior
Upcoming Economic Calendar Highlights (All Times GMT)
SI CPI (0500)
SI Industrial Production (0500)
UK BBA Loans for House Purchase (0930)
UK Index of Services (0930)
US Durable Goods Orders (1330)
CA Oct. GDP (1330)
US Personal Income/Spending (1330)
US PCE Deflator (1330)
US New Home Sales (1500)
Andrew Robinson
SAXO BANK