Markets ended the week on a relatively steady note on Friday after the US employment report indicated that the economy had added a seasonally adjusted 145,000 jobs in December, while headline unemployment remained unchanged at a 50-year low of 3.5%. Wages advanced slightly less than expected, at 2.9%yy, the smallest annual gain since July 2018, while the stock indices finished around 0.3%/0.5% lower, after rising earlier in the day when the DJI briefly breached 29000 for the first time.
The coming week is likely to be dominated by political headlines coming particularly from the US/Middle East and also from the UK as Brexit fast approached at the end of the month, while in economic terms, the big deal will be the propose signing of Phase 1 of the US/China trade agreement. The deal calls for China to buy $40/$50 billion worth of US agricultural products annually, and a total of $200 billion of US goods over two years. Elsewhere, the week’s data is going to be dominated by inflation figures, with CPI/PPI numbers due from almost every major trading entity including Australia (Mon), US (Tue), NZ, UK, US (Wed), Japan, Germany (Thur) and the EU (Fri). Otherwise the calendar is a little thin, which is possibly just as well given that ongoing political tensions will continue to drive the price action in all asset classes, in terms of risk sentiment. Have a good week.
Economic data highlights will include:
Mon: Australian TD Inflation, UK Manufacturing/Industrial Production, Goods Trade Balance, NIESR GDP Estimate
Tue: NZIER Business Confidence, Building Permits, Japan Eco Watchers Survey, Current Account, Trade Balance, China Trade Balance, US NFIB Business Optimism Index, CPI, Monthly Budget Statement, API Weekly Crude Oil Stock Inventory
Wed: REINZ House Price Index, NZ Food Price Index, Australian WBC Consumer Confidence, UK CPI, PPI, RPI, EU Industrial Production, Trade Balance, US New York State Empire Mfg Index, PPI, EIA Crude Oil Stocks Weekly Change, US/China Trade deal signing – Phase 1, Fed’s Harker – Speech
Thur: NZ Electronic Card Retail Sales, Japan PPI, Monday, Australian Home Loans, Investment Lending for Homes, China House Price Index, German CPI, UK BOE Credit Card Survey, ECB Minutes, US Retail Sales, Philadelphia Fed Mfg Survey, Jobless Claims, Business Inventories, NAHB Housing Market Index
Fri: NZ Business PMI, Australian New Home Sales, China Q4 GDP, Fixed Asset Investment, Industrial Production, Retail Sales, German Wage Price Index, EU Current Account, UK Retail Sales, EU CPI, US Building Permits, Housing Starts, Industrial Production, Capacity Utilisation, Michigan Consumer Sentiment Index
Market moves, in brief:
FX: DXY 97.35 (-0.07%)
Bonds: US10Y; 1.822% (+0.14%), German 10Y; -0.234% (-6.26%), UK 10Y; +0.689% (-0.03%), Australian 10Y; 1.267% (+1.67%), NZ 10Y; 1.493% (+0.03 %), China 10Y; 3.115% (-1.04%)
Stock Indices: DJI; -0.46%, S+P; -0.29%, NASDAQ; -0.27%, EUStoxx50; -0.17%, FTSE100; -0.14%, Shanghai Composite; -0.08%,
Metals: Gold $1562 oz (+0.63%), Silver $18.11 oz (+1.23%), Copper $2.8135 lb (+0.41%), Iron Ore $93.56 per tonne (NYMEX) (-0.01%),
Oil: WTI $59.16 pb (0.67%)
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