Tuesday 9th December: European Open Briefing

Global Markets:

  • Asian stock markets: Nikkei down 0.70 %, Shanghai Composite down 1.90 %, Hang Seng lost 2.00 %, ASX declined 1.70 %
  • Commodities: Gold at $1202 (+0.65 %), Silver at $16.34 (+0.40 %), Crude Oil at $62.68 (-0.60 &)
  • Rates: US 10 year yield at 2.264, UK 10 year yield at 1.964, German 10 year yield at 0.712

News & Data:

  • Australia NAB Business Confidence 1.0, Previous: 4.0
  • Australia NAB Business Survey 5.0, Previous: 13.0

Markets Update:

USD/JPY was bid in the early Asian session with Japanese names the main buyers. The pair then fell sharply from 120.90 down to a low of 119.70. The main reasons were Nikkei weakness, broad risk-off sentiment and large covering of built up USD/JPY and JPY cross positions. The next key support level is eyed at 119.30 (December 04th low) and then 117.83 (December 01st low).

EUR/USD benefited from the broad USD weakness, rising to 1.2340. It hit into some decent selling interest ahead of the 1.2350 level, but larger stops around 1.2365 might attract. Should we take out the level, next resistance is seen at 1.2380 with larger offers then reported close to the 1.24 level. To the downside, key intraday support at 1.2290, with 1.2245 now the pivotal short-term level.

AUD/USD remains weak amid risk aversion and falling commodity prices. The pair opened around 0.83 in Asia and reached a fresh multi-year low of 0.8220. Meanwhile, the Canadian Dollar is surprisingly resilient, especially given the sharp decline in Oil prices yesterday. USD/CAD almost reached the 1.15 level, but option-related offers sent it back towards 1.1475. Keep an eye on the 1.1430 level as key intraday support.

Upcoming Events:

  • 09:30 GMT – UK Industrial Production (0.2 % m/m, 1.8 % y/y)
  • 09:30 GMT – UK Manufacturing Production (0.2 % m/m, 3.2 % y/y)
  • 15:00 GMT – US JOLTs Job Openings (4.79mln)

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