U.S. Markets Update On January 18th, 2020

U.S. Markets Update On January 18th, 2020

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Dollar gains on U.S. economic optimism, Wall street hits new high,gold edges higher, Oil steadies as Chinese economy offsets trade optimism - January 18th, 2020.

Market Roundup 

• US Dec Building Permits (MoM)  -3.9%, 0.9%  previous

• US Dec Building Permits 1.416M,    1.468M forecast, 1.474M previous

• US Dec Housing Starts (MoM) 16.9%,2.6% previous

• US Dec Housing Starts 1.608M, 1.375M forecast, 1.375M previous

• Canada Nov Foreign Securities Purchases -1.75B, 11.31B previous

• Canada Nov Foreign Securities Purchases by Canadians 5.55B, 2.03B previous

• US Dec Capacity Utilization Rate 77.0%,77.1% forecast, 77.4% previous

• US Dec Industrial Production (MoM) -0.3%,-0.2% forecast 0.8% previous

• US Dec Industrial Production (YoY)  -1.01%,-0.68% previous

• US Nov JOLTs Job Openings, 7.233M forecast, 7.361M

• US Jan Michigan 5-Year Inflation Expectations 2.50%,2.20% previous

• US Jan  Michigan Consumer Sentiment 99.1, 115.0 forecast, 115.5 previous

Looking Ahead - Events, Other Releases (GMT)

• No significant events

EUR/USD: The euro declined against the U.S. dollar on Friday, as economic data pointed to solid economic growth, and reduced fears about an impending slowdown.  U.S. homebuilding surged to a 13-year high in December as activity increased across the board, suggesting the housing market recovery was back on track amid low mortgage rates.It comes after data on Thursday showed that U.S. retail sales increased for a third straight month in December, while a gauge of manufacturing activity in the U.S. Mid-Atlantic region rebounded in January to its highest level in eight months. The euro was last down 0.32% at $1.1099. Immediate resistance can be seen at 1.1138 (21 DMA), an upside break can trigger rise towards 1.1200 (Psychological level).On the downside, immediate support is seen at 1.1084 (Daily low), a break below could take the pair towards 1.1057 (Lower BB).

GBP/USD: Sterling declined against dollar on Friday, as weaker than expected UK retail sales data weighed on sterling. British consumers failed to increase their spending for a record fifth month in a row in December, adding to signs of economic weakening that might prompt the Bank of England to cut interest rates this month. Data on Friday showed sales volumes fell by 0.6% from November, defying the median forecast for a rise of 0.5%. The pound was down 0.49% against the dollar, at $1.3014 , the lowest level since Dec. 27. Immediate resistance can be seen at 1.3102 (5 DMA), an upside break can trigger rise towards 1.3331 (Higher BB).On the downside, immediate support is seen at 1.3000 (Psychological level), a break below could take the pair towards 1.2905 (Lower BB).

USD/CAD: The Canadian dollar was little changed against its U.S. counterpart on Friday, extending its recent holding pattern as the greenback broadly rose and investors awaited an interest rate decision next week from the Bank of Canada. The central bank is expected to leave its benchmark interest rate on hold at 1.75% next Wednesday, when it will also update its economic outlook. At (21:04 GMT), the Canadian dollar was trading nearly unchanged at 1.3055 to the greenback. Immediate resistance can be seen at 1.3106 (Jan 9th High), an upside break can trigger rise towards 1.3173 (50 DMA).On the downside, immediate support is seen at 1.3065 (5 DMA), a break below could take the pair towards 1.3033(11 DMA).

USD/JPY: The dollar strengthened against the Japanese yen on Friday, as demand for risk appetite increased after upbeat US economic data. The dollar continued to gain against the yen, after being buoyed on Thursday by data showing that U.S. retail sales increased for a third straight month in December. Data on Friday showed that U.S. manufacturing output rose unexpectedly in December, though industrial production fell. Strong resistance can be seen at 110.40 (Higher BB), an upside break can trigger rise towards 111.00 (Psychological level).On the downside, immediate support is seen at 110.16 (5 DMA), a break below could take the pair towards 109.35 (11 DMA).

Equities Recap

  • European shares clocked a record closing high on Friday after EU Trade Commissioner Phil Hogan struck a positive tone on talks with Washington and on optimism over signs of resilience in China’s economy.
  • UK's benchmark FTSE 100 closed up by 0.85 percent, Germany's Dax ended up by 0.72 percent, France’s CAC finished the day up by 1.02 percent.
  • U.S. stock indexes edged higher to hit fresh record highs on Friday on optimism over corporate earnings, economic data and indications of resilience in a Chinese economy battered by a prolonged trade war with the United States.
  • Dow Jones closed up by 0.17 percent, S&P 500 ended up by 0.34 percent, Nasdaq finished up by 0.34 percent.

Treasuries Recap

  • U.S. Treasury yields rose on Friday after strong homebuilding and manufacturing reports and upbeat corporate earnings, while traders eyed the potential impact of a new government bond coming by summer.
  • The benchmark 10-year yield was up 2.5 basis points in morning trading at 1.8337%.

Commodities Recap

  • Gold edged higher on Friday boosted by as chronic shortage of the metal in the market and hopes the global economy might be turning the corner.
  • Gold edged 0.3% higher to $1,557.12 per ounce, but was headed for first weekly decline in six. Prices were down 0.3% for the week.U.S. gold futures rose 0.4% to $1,557.12
  • Oil prices steadied on Friday as sluggish economic growth in China, the world’s biggest crude importer, raised concerns over fuel demand and countered optimism from the signing of a China-U.S. trade deal.
    Brent crude futures rose 23 cents to settle at $64.85 a barrel. U.S. West Texas Intermediate (WTI) crude futures rose 2 cents to settle at $58.54 a barrel.