Americas Roundup: Dollar up 10 Percent Against Euro for Year, Hits more Than Two-Month Low Against Yen, Oil Market Ends 2015

Market Roundup

  • U.S. jobless claims rise sharply during holiday week (+20k to 287k vs 270k forecast)).
  • Chicago Dec Purchasing Management Index at lowest since July 2009 (42.9 vs 49.8 forecast).
  • Bank of Japan expected to lower inflation forecast – Nikkei.
  • Banxico unanimous in decision to raise rates, majority thought absence of hike would have led to further MXN weakness -minutes.
  • Oil rallies into close on short-covering; Crude oil prices lost a third in value in 2015, Outlook for 2016 remains bleak as oversupply balloons

Looking Ahead – Economic Data (GMT)

  • Jan 1 01:00 China NBS Non-Mfg PMI Dec 53.6-previous
  • Jan 1 01:00 China NBS Mfg PMI* Dec forecast 49.7, 49.6-previous
  • 22:30 Australia AIG Mfg Index Dec 52.5-previous
  • 01:45 China Caixin Mfg PMI Final Dec forecast 49, 48.6-previous
  • 01:35 Japan Nikkei Mfg PMI Dec 52.5-previous

Looking Ahead – Events, Other Releases (GMT)

  • 04:00 Japan- Japanese Finance Minister Taro Aso delivers a speech at parliament

Currency SummariesEUR/USD is likely to find support at 1.0850 levels and currently trading at 1.0853 levels. The pair has made session high at 1.0902 and hit lows at 1.0853 levels. The dollar rose sharply against euro on Thursday, On broader the view that, the Federal Reserve is set to start cycle of interest rate hike in 2016, combined with steadily loose monetary policy from the European Central Bank and Bank of Japan, would continue to bolster the greenback. The dollar index, which measures the greenback against a basket of six major rivals, hit a more than one-week high of 98., trading volumes remained thin heading into year-end. The euro was down 0.1 percent on Thursday, on track for a fall of nearly 10 percent against the dollar in 2015. To the upside, immediate resistance can be seen at 1.0900. To the downside, immediate support level is located at 1.0853 levels.USD/JPY is supported around 119.83 levels and currently trading at 120.19 levels. It hit session high at 120.41 and made session lows at 120.00 levels. US dollar slipped sharply lower against Japanese Yen on Thursday , after data showed number of Americans filing new claims for unemployment benefits rose sharply last week, a potential signal the job market was losing steam although some of the increase might be attributed to temporary holiday factors. Initial claims for state unemployment benefits rose 20,000 to a seasonally adjusted 287,000 for the week ended Dec. 26, the U.S. Labor Department said on Thursday. That was the highest since July, although in recent months the weekly readings for claims have held near a 42-year low. Against the yen, the dollar hit a more than two-month low of 120.005 yen. To the upside, immediate resistance can be seen at 120.42. To the downside, immediate support level is located at 120.00 levels.

USD/CAD is supported at 1.3794 levels and is trading at 1.3827 levels. It has made session high at 1.3900 and lows at 1.3821 levels. The Canadian dollar rose sharply against US dollar on Thursday after weaker-than-expected U.S. data trimmed gains for the greenback against a basket of major currencies, trading in a tight range ahead of the New Year’s Day holiday. The loonie, as Canada’s currency is colloquially known, is on track to fall further in 2016, pressured by deep losses for crude oil prices and two rate cuts from the Bank of Canada, while the U.S. Federal Reserve hiked rates for the first in more than nine years. Oil prices headed for a second year of steep losses in their last trading hours of 2015 as record OPEC supply created an unprecedented global glut that may take another year to clear. U.S. crude prices fell 0.66 percent to $36.36 a barrel, while Brent crude lost 0.22 percent to $36. currency’s strongest level of the session was C$1.3859, while its weakest level was C$1.3901. It had hit its weakest level in more than 11 years on Dec. 18 at C$1.4003.NZD/USD is supported around 0.6823 levels and currently trading at 0.6837 levels. It hit session high at 0.6846 and made session lows at 0.6830 levels. The New Zealand dollar slipped lower against US dollar on Thursday to ending 2015 sharply lower against their U.S. peer, and could remain under pressure in the New Year if commodity prices remain weak. The New Zealand dollar was a tad weaker at $0.6842 on Thursday ahead of a four-day holiday weekend. While up from a six-year low below 61 cents, it is still on track for a loss of more than 10 cents on the year. The Antipodean currency has come under pressure this year on falling commodity prices, sluggish economic growth at home and diverging interest rates Central Bank of New Zealand and the Federal Reserve. To the upside, immediate resistance can be seen at 0.6861. To the downside, major support level is located at 0.6830 levels.Equities RecapEuropean shares ended 2015 mostly higher than where they started, but well below their peaks after weak commodity prices weighed on markets in the final quarter.Britain’s blue-chip FTSE 100 index shed 0.5 percent on Thursday and France’s benchmark CAC-40 index was down 0.9 percent, while Germany’s DAX was closed for a public holiday and other markets had half-day sessions.Wall Street dipped on Thursday, with the S&P 500 moving toward a flat ending to a volatile year marked by record highs as well as a major selloff.Dow Jones closed down by 0.26 percent, S&P 500 ended down by 0.20 percent, Nasdaq finished the day down by 0.32 percent.Treasuries Recap U.S. Treasuries prices rose on Thursday and the yield curve flattened, with U.S. government debt set to end the year on a more positive note than many investors expected.Benchmark 10-year U.S. Treasury notes were last up 10/32 in price to yield 2.273 percent, down from 2.305 percent late on Tuesday.The U.S. 30-year bond was last up 18/32 in price to yield 3.014 percent, down from 3.043 percent late on Tuesday.Commodities RecapGold was steady on Thursday but poised to mark its third straight annual loss, ahead of what is likely to be another tough year with the prospect of higher U.S. interest rates and dollar strength.U.S. gold futures for February delivery settled at $1,060.2 per ounce on Thursday, almost flat compared with Wednesday’s close of $1,059.8 and close to six-year lows of $1,046 per ounce earlier in December.Oil prices rose on Thursday but fell as much as 35 percent for the year after a race to pump by Middle East crude producers and U.S. shale oil drillers created an unprecedented global glut that may take through 2016 to clear.Brent crude settled up 82 cents at $37.28 a barrel, rebounding from a near 11-year low of $36.10 hit earlier in the session. For the month, it was down 16 percent and for the year, it fell 35 percent. In 2014, Brent lost 48 percent.WTI rose 44 cents to $37.04 a barrel. It slid 11 percent in December and 30 percent for the year, after a 46 percent loss in 2014.

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