Posted at 27 January 2025 / Categories Market Roundups
Market Roundup
•US Building Permits (MoM) (Dec) -0.7%, -0.7% forecast, 5.2% previous
•US Building Permits (Dec) 1.482M, 1.483M forecast, 1.493M previous
•US Chicago Fed National Activity (Dec) 0.15, -0.06 forecast, -0.01 previous
•Canada Wholesale Sales (MoM) (Dec) 0.1%, -0.2% forecast
•French 12-Month BTF Auction 2.407%, 2.408% previous
• French 3-Month BTF Auction 2.608%, 2.633% previous
• French 6-Month BTF Auction 2.508%, 2.532% previous
•French Belgium NBB Business Climate (Jan) -13.6, -10.3 forecast, -13.8 previous
• US New Home Sales (Dec) 698K, 669K forecast, 674K previous
•US New Home Sales (MoM) (Dec) 3.6%, 9.6% previous
•US Dallas Fed Mfg Business Index (Jan) 14.1, 4.5 previous
Looking Ahead Economic Data (GMT)
• 23:50 Japan Corporate Services Price Index (CSPI) (YoY) 3.2%foreacst, 3.0% previous
•00:30 Australia NAB Business Confidence (Dec) -3 previous
•00:30 Australia NAB Business Survey (Dec) 2 previous
•05:00 Japan BoJ Core CPI (YoY) 1.7% forecast, 1.7% previous
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Forecast
EUR/USD: The euro initially gained but gave up some ground as investors positioned ahead of ECB rate decision . Traders have priced in a quarter point cut by the ECB, while they expect the Fed to keep rates steady.Fourth-quarter gross domestic product numbers for the euro zone and Germany, along with regional inflation data are due during the week. German business morale unexpectedly improved thanks to a more positive assessment of the current economic situation, a survey showed on Monday, although analysts said many companies remain pessimistic with uncertainty rife ahead of elections. The Ifo institute said its business climate index increased to 85.1 in January from 84.7 in the previous month. Analysts polled by Reuters had forecast a reading of 84.7.The current conditions index rose to 86.1 in January from 85.1 in December, while the expectations index fell slightly to 84.2 from 84.4. Immediate resistance can be seen at 1.0554(50%fib), an upside break can trigger rise towards 1.0677(61.8%fib).On the downside, immediate support is seen at 1.0419(38.2%fib), a break below could take the pair towards 1.0361(Jan 23rd low).
GBP/USD: Sterling rallied against the dollar on Monday as investors focused on the Federal Reserve's first policy meeting of the year for clues about future interest rate moves. The Federal Reserve and European Central Bank rate decisions are due on Wednesday and Thursday, respectively. In a busy week for global central bank meetings, the Federal Reserve's first interest rate decision on Wednesday will be key, where the U.S. central bank is widely expected to hold its lending rate steady.Markets will also keep a watch out for the December reading of the U.S. personal consumption expenditures which is due on Friday, a crucial metric in assessing the inflation trajectory. Immediate resistance can be seen at 1.2526(50%fib), an upside break can trigger rise towards 1.2659(61.8%fib).On the downside, immediate support is seen at 1.2395(38.2%fib), a break below could take the pair towards 1.2227(23.6%fib)
USD/CAD: The Canadian dollar against the U.S. dollar on Monday as uncertainty around international trade and falling oil prices weighed on Canadian dollar. The Bank of Canada is expected to cut its benchmark interest rate by 25 basis points on Wednesday, while the U.S. Federal Reserve is likely to keep rates unchanged. Trump’s threat of a 25% tariff on all goods imported from Canada starting February 1 has added pressure on the loonie, given Canada's reliance on U.S. trade. The U.S. is Canada's largest trading partner, importing over three-fourths of its exports. The loonie was trading 0.27% weaker at 1.4381 per U.S. dollar , but continued to be in the range of 1.4316 to 1.4383 where it traded mostly last week. Immediate resistance can be seen at 1.4199 (Jan 23rd high), an upside break can trigger rise towards 1.4515(23.6%fib).On the downside, immediate support is seen at 1.4364(50%fib), a break below could take the pair towards 1.4253 (Lower BB).
USD/JPY: The U.S. dollar slipped lower on Monday as rush for safe-haven assets increased as tech stocks plunged, with investors weighing the implications of a Chinese startup launching a free open-source artificial intelligence model. China's DeepSeek launched a free AI assistant that it claims uses cheaper chips and less data, posing a challenge to the AI trend that has boosted U.S. tech stocks, particularly Nvidia. The Japanese yen rose 0.87% to 154.63 against the dollar after tightening up to 153.71, its strongest level since mid-December. Immediate resistance can be seen at 156.42 (38.2%fib) an upside break can trigger rise towards 157.00(Psychological level). On the downside, immediate support is seen at 153.78(50%fib) a break below could take the pair towards 151.40 (61.8%fib).
Equities Recap
European tech shares fell on Monday after Chinese startup DeepSeek's low-cost AI model raised concerns about returns in the AI sector and the need for expensive chips
UK's benchmark FTSE 100 closed flat at 0.00 percent, Germany's Dax ended down by 0.53 percent, France’s CAC finished the day down by 0.27 percent.
The Nasdaq recorded its largest one-day percentage drop since December 18 on Monday, as a low-cost Chinese AI model led to a sharp selloff in U.S. chipmakers.
Dow Jones closed up by 0.65 percent, S&P 500 closed down by 1.46 percent, Nasdaq settled down by 3.07 percent.
Commodities Recap
Gold prices fell over 1% on Monday, retreating from near-record highs, as investors sold off bullion amid a broader market decline triggered by growing interest in Chinese AI startup DeepSeek.
Spot gold was down 1.3% at $2,736.75 per ounce as of 01:49 p.m. ET (1849 GMT). Prices had risen to near-record high levels on Friday. U.S. gold futures settled 1.5% lower at $2,738.40 per ounce.
Oil prices dropped around 2% to a two-week low on Monday after news of growing interest in Chinese startup DeepSeek's low-cost AI model raised concerns about energy demand for data centers.
Brent futures fell $1.42, or 1.8%, to settle at $77.08 a barrel, while U.S. West Texas Intermediate (WTI) crude ended $1.49, or 2.0%, lower at $73.17.Brent closed at its lowest since Jan. 9 and WTI at its lowest since Jan. 2.