U.S. Markets Update On January 9th, 2020

U.S. Markets Update On January 9th, 2020

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Dollar gains as markets stabilize after Iran strike, Wall street gains, Gold eases, Oil dives as U.S., Iran tensions ease - January 9th,2020.

Market Roundup

• US ADP Nonfarm Employment Change 202K, 160K forecast, 124K previous

• US Crude Oil Inventories1.164M, -3.572M forecast, -11.463M previous

• Brazil   Foreign Exchange Flows -0.855B, -16.097B previous

Looking Ahead - Economic Data (GMT)

• 21:30 Australia Dec AIG Construction Index  40.0 previous

• 23:50 Japan Foreign Bonds Buying -927.6B previous

• 23:50 Japan Foreign Investments in Japanese Stocks

•00:00 New Zealand ANZ Commodity Price Index (MoM) 4.3% previous

• 00:30 Australia Nov Exports (MoM)  -5% previous

• 00:30 Australia  Nov Imports (MoM)  0%  previous

• 00:30 Australia  Nov Trade Balance   4.150B forecast, 4.502B previous

• 01:30 China Dec CPI (YoY)  4.7% forecast,4.5% previous

• 01:30 China Dec CPI (MoM)  0.3%,0.3% 0.4% previous

Looking Ahead - Events, Other Releases (GMT)     

• No significant events.

Currency Summaries

EUR/USD: The euro declined against the U.S. dollar on Wednesday, as a higher-than-expected U.S. private payrolls number for December boosted the dollar. The ADP National Employment Report on Wednesday showed private payrolls jumped by 202,000 jobs last month after an upwardly revised 124,000 gain in November. Economists polled by Reuters had forecast private payrolls advancing 160,000 last month following a previously reported 67,000 rise in November.The euro was last trading at  0.02 percent lower at $1.1102. Immediate resistance can be seen at 1.1132 (11 DMA), an upside break can trigger rise towards 1.1159 (5 DMA).On the downside, immediate support is seen at 1.1092 (50 DMA), a break below could take the pair towards 1.1000 (Psychological level).

GBP/USD: The pound edged higher on Wednesday as risky assets recouped earlier losses on a perception that Iran’s rocket attacks on U.S. forces in Iraq would not lead to a wider regional conflict.Iran said it had fired 15 missiles at U.S. targets in Iraq early on Wednesday in retaliation for last week’s U.S. drone strike that killed Iranian commander Qassem Soleimani, stoking fears of a new war in the Middle East. The British currency edged a third of a percent higher to $1.3163, moving towards a two-week high of $1.3284 hit on Dec. 17. Immediate resistance can be seen at 1.3217 (Jan 7th high), an upside break can trigger rise towards 1.3175 (Dec 31st high).On the downside, immediate support is seen at 1.3073 (11 DMA), a break below could take the pair towards 1.3000 (Psychological level).

USD/CAD: The Canadian dollar fell to an eight-day low against its U.S. counterpart on Wednesday, as oil prices tumbled on fading alarm over an Iran rocket strike and the greenback broadly climbed. The price of oil, one of Canada's main exports, fell in a wild swing, soaring close to a four-month high in early trade on an Iranian rocket attack on U.S. forces in Iraq before retreating as Iran and the United States quickly ratcheted back tension. Immediate resistance can be seen at 1.3044 (Daily high), an upside break can trigger rise towards 1.3105 (21 DMA).On the downside, immediate support is seen at 1.2953 (Jan 7th low), a break below could take the pair towards 1.2900 (Psychological level).

USD/JPY: The dollar rose against the Japanese yen on Wednesday, as investor were optimistic that Iran’s attack on U.S. forces in Iraq was unlikely to escalate into a full-blown conflict in the region.Iran said it had fired missiles at U.S. targets in Iraq in retaliation for last week’s U.S. drone strike that killed Iranian commander Qassem Soleimani and raised fears of a new war in the Middle East. Investors are betting on a de-escalation in Middle East tensions and the United States and Iran to revert to a tit-for-tat relationship. Strong resistance can be seen at 109.70 (26th Dec high), an upside break can trigger rise towards 110.00 (Psychological level).On the downside, immediate support is seen at 109.41 (11 DMA), a break below could take the pair towards 109.18 (21 DMA).

Equities Recap

  • European shares ended higher on Wednesday after Iran indicated the overnight missile strikes “concluded” its retaliation to the U.S. killing of General Qassem Soleimani.
  • The UK's benchmark FTSE 100 closed up by 0.01 percent, Germany's Dax ended up by 0.71 percent, and France’s CAC finished the up  by 0.31 percent.
  • Wall Street indexes edged higher on Wednesday as investors drew comfort from Iranian signals that overnight missile strikes “concluded” its retaliation to the U.S. killing of General Qassem Soleimani.
  • Dow Jones closed up by 0.56 percent, S&P 500 ended up at 0.49 percent, Nasdaq finished the day up by 0.67 percent.

Treasuries Recap

  • U.S. Treasury yields were steady on Wednesday morning, retracing their overnight drop as investor concerns eased about the conflict between Iran and the United States.
  • The 10-year yield was last 0.7 basis point lower to 1.818%, recouping nearly all of its overnight drop as demand for the safe-haven security receded.

Commodities Recap

  • Gold retreated after vaulting above the $1,600 level for the first time in nearly seven years on Wednesday as fears of a larger conflict in the Middle East abated on milder rhetoric between Iran and the United States.
  • Spot gold was slightly subdued at $1,573.50 per ounce as of 10:55 a.m. EST (1555 GMT), having soared to $1,610.90 earlier in the session, its highest level since March 2013. Meanwhile, U.S. gold futures inched 0.1% higher to $1,575.
  • Oil futures fell more than 4% on Wednesday in a wild swing, soaring close to a four-month high in early trade on an Iranian rocket attack on U.S. forces in Iraq before retreating as the countries quickly ratcheted back tensions.
  • Brent  futures fell $2.83 to settle at $65.44 a barrel and U.S. WTI crude  settled down $3.09 at $59.61 a barrel.