Market Review - 12/12/2014 19:18GMT
Dollar retreats on sell off in U.S. stocks despite upbeat consumer sentiment index
The greenback remained slightly lower against other major currencies on Friday, as investors shrugged off the data which showed that U.S. consumer sentiment improved at the fastest rate since January 2007.
Versus the Japanese yen, although dollar briefly climbed to 119.19 in Asia, price retreated to 118.51 in Tokyo lunch session and then dropped further to a low of 118.06 in European morning due to fall in Nikkei futures. Later, renewed buying interest above 118.00 lifted price from there and dollar rallied to 119.08 in New York morning after release of upbeat University of Michigan consumer sentiment. However, investor shrugged off the robust data ahead of Japan's election for Lower House of Parliament on Sunday and dollar tanked to 118.20 before staging another recovery.
The University of Michigan said on Friday in a preliminary report that its consumer sentiment index rose to a nearly 8-year high of 93.8 this month from 88.8 in November. Market had expected the index to rise to 89.5 in December. Earlier, in a separate report, U.S. Department of Labor reported that producer price inflation fell 0.2% last month, compared to expectations for a 0.1% downtick, after a 0.2% rise in October.
A report from Forbes showed - On Sunday, parliamentary elections in Japan are widely expected to return Prime Minister Abe and his ruling coalition to power. Japanese media polling data point to a victory for the Liberal Democratic Party (LDP) of over 300 of the 475 Lower House seats, and with an additional 30 or more seats expected for the Komeito, the LDP's junior coalition partner, this would give the current government a comfortable basis from which to govern. It is even possible that Mr. Abe's government will retain its two-thirds majority, allowing his next government broad legislative support for his policy agenda.
The single currency edged lower from Australian high of 1.2413 in Asia and briefly dropped to 1.2384 in European morning before staging a rebound. Later, price ratcheted higher to 1.2477 in New York morning. Despite a brief pullback to 1.2433 after release of upbeat U.S. consumer sentiment report, renewed broad based weakness in greenback pushed price to a session high of 1.2485 before retreating.
On the data front, data showed that industrial production in the euro zone rose 0.1% in October, after a 0.5% increase in September. Year-on-year, the industrial production increased 0.7% in October, compared to expectations for a 0.6% rise, after a revised 0.2% uptick in September.
Cable swung wildly on Friday as despite retreating from Australian high of 1.5737 in tandem with euro to 1.5697 in European morning, price rebounded to 1.5745 in New York morning before dropped to 1.5698. Later, the British pound staged another rebound to 1.5735 and then stabilized around 1.5710-20 level.
Data to be released this week:
Japan's Tankan surveys, Switzerland's Proper/Import Price, UK's CBI Trends, U.S.'s NY Fed Manufacturing, Capacity Utilization, Industrial Output, Manufacturing Output, NAHB Housing Market Index, Net Long-Term TIC Flows on Monday.
Australia's RBA Minutes, China HSBC Manufacturing PMI, Markit Manufacturing PMI and Service PMI for France, Germany and Eurozone, Italy's Trade Balance, UK's PPI, CPI,RPI, BoE Financial Stability Report, Germany ZEW Current Conditions, Eurozone's trade balance, Canada's Manufacturing sales, U.S.'s Building Permits, Housing Starts, redbook and Markit Manufacturing PMI on Tuesday.
New Zealand's Current Account, Japan's Trade Balance, exports, imports, Switzeland's SNB's Quarterly Bulletin, ZEW Investor Sentiment, UK's BoE Meeting Minutes and MPC Vote Outcome, Average Earnings, Claimant Count Change, ILO Unemployment, Eurozone's Inflation data, Lobour Costs, Canada's Wholesale trade, U.S.'s CPI, Current Account, FOMC Rate Decision on Wednesday.
New Zealand's GDP, China's House Prices, Switzerland's Trade, Germany's IFO Business Climates, IFO Current Conditions, IFO Expectations, U.K.'s Retail sales, U.S. Markit Service PMI, Philly Fed Business and Leading index change on Thursday.
New Zealand's NBNZ Business Outlook, Germany's Gfk Consumer confidence, Gfk Consumer Sentiment, Producer Prices, France's Business Climate, Eurozone's Current Accounts, Italy's Industrial Sales, U.K.'s Gfk Consumer Confidence, PSNCR, PSNB, CBI Distributive Trades, Canada's CPI and Retail Sales on Friday.
Dollar retreats on sell off in U.S. stocks despite upbeat consumer sentiment index
The greenback remained slightly lower against other major currencies on Friday, as investors shrugged off the data which showed that U.S. consumer sentiment improved at the fastest rate since January 2007.
Versus the Japanese yen, although dollar briefly climbed to 119.19 in Asia, price retreated to 118.51 in Tokyo lunch session and then dropped further to a low of 118.06 in European morning due to fall in Nikkei futures. Later, renewed buying interest above 118.00 lifted price from there and dollar rallied to 119.08 in New York morning after release of upbeat University of Michigan consumer sentiment. However, investor shrugged off the robust data ahead of Japan's election for Lower House of Parliament on Sunday and dollar tanked to 118.20 before staging another recovery.
The University of Michigan said on Friday in a preliminary report that its consumer sentiment index rose to a nearly 8-year high of 93.8 this month from 88.8 in November. Market had expected the index to rise to 89.5 in December. Earlier, in a separate report, U.S. Department of Labor reported that producer price inflation fell 0.2% last month, compared to expectations for a 0.1% downtick, after a 0.2% rise in October.
A report from Forbes showed - On Sunday, parliamentary elections in Japan are widely expected to return Prime Minister Abe and his ruling coalition to power. Japanese media polling data point to a victory for the Liberal Democratic Party (LDP) of over 300 of the 475 Lower House seats, and with an additional 30 or more seats expected for the Komeito, the LDP's junior coalition partner, this would give the current government a comfortable basis from which to govern. It is even possible that Mr. Abe's government will retain its two-thirds majority, allowing his next government broad legislative support for his policy agenda.
The single currency edged lower from Australian high of 1.2413 in Asia and briefly dropped to 1.2384 in European morning before staging a rebound. Later, price ratcheted higher to 1.2477 in New York morning. Despite a brief pullback to 1.2433 after release of upbeat U.S. consumer sentiment report, renewed broad based weakness in greenback pushed price to a session high of 1.2485 before retreating.
On the data front, data showed that industrial production in the euro zone rose 0.1% in October, after a 0.5% increase in September. Year-on-year, the industrial production increased 0.7% in October, compared to expectations for a 0.6% rise, after a revised 0.2% uptick in September.
Cable swung wildly on Friday as despite retreating from Australian high of 1.5737 in tandem with euro to 1.5697 in European morning, price rebounded to 1.5745 in New York morning before dropped to 1.5698. Later, the British pound staged another rebound to 1.5735 and then stabilized around 1.5710-20 level.
Data to be released this week:
Japan's Tankan surveys, Switzerland's Proper/Import Price, UK's CBI Trends, U.S.'s NY Fed Manufacturing, Capacity Utilization, Industrial Output, Manufacturing Output, NAHB Housing Market Index, Net Long-Term TIC Flows on Monday.
Australia's RBA Minutes, China HSBC Manufacturing PMI, Markit Manufacturing PMI and Service PMI for France, Germany and Eurozone, Italy's Trade Balance, UK's PPI, CPI,RPI, BoE Financial Stability Report, Germany ZEW Current Conditions, Eurozone's trade balance, Canada's Manufacturing sales, U.S.'s Building Permits, Housing Starts, redbook and Markit Manufacturing PMI on Tuesday.
New Zealand's Current Account, Japan's Trade Balance, exports, imports, Switzeland's SNB's Quarterly Bulletin, ZEW Investor Sentiment, UK's BoE Meeting Minutes and MPC Vote Outcome, Average Earnings, Claimant Count Change, ILO Unemployment, Eurozone's Inflation data, Lobour Costs, Canada's Wholesale trade, U.S.'s CPI, Current Account, FOMC Rate Decision on Wednesday.
New Zealand's GDP, China's House Prices, Switzerland's Trade, Germany's IFO Business Climates, IFO Current Conditions, IFO Expectations, U.K.'s Retail sales, U.S. Markit Service PMI, Philly Fed Business and Leading index change on Thursday.
New Zealand's NBNZ Business Outlook, Germany's Gfk Consumer confidence, Gfk Consumer Sentiment, Producer Prices, France's Business Climate, Eurozone's Current Accounts, Italy's Industrial Sales, U.K.'s Gfk Consumer Confidence, PSNCR, PSNB, CBI Distributive Trades, Canada's CPI and Retail Sales on Friday.
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