Americas Roundup: Dollar Gains Vs Euro on Risk Appetite, Oil Gains 3 Percent-December 30th, 2015

Market Roundup

  • U.S. home prices rise slightly in October, top forecast.
  • U.S. advance Nov goods trade deficit rises slightly to USD 60.50 billion.
  • Brazil’s House to decide on impeachment by end-March: speaker.
  • Turkey central bank expects inflation indicators to remain elevated.
  • Brazil primary budget deficit swells, debt seen climbing .
  • German states to spend around 17 billion euros on refugees in 2016 – Die Welt.

Looking Ahead – Economic Data (GMT)

  • No Significant Data

Looking Ahead – Events, Other Releases (GMT)

  • No Significant Events

Currency SummariesEUR/USD is likely to find support at 1.0871 levels and currently trading at 1.0922 levels. The pair has made session high at 1.0940 and hit lows at 1.0899 levels. The U.S. dollar inched higher against euro on Tuesday after greater risk appetite hurt demand for the shared currency and new pressure from short sellers likely weighed. Investors preferred riskier assets, including stocks and emerging market currencies, after a recovery in oil prices boosted sentiment. The greater risk appetite hurt the euro, which traders view as a safer funding currency, given its low yield. The euro hit $1.09090, its lowest since Dec. 24. The U.S. dollar index, which measures the greenback against a basket of six major rivals, rose to 98.371 from a nearly two-week low early Tuesday of 97.799. The euro was down 0.26 percent against the dollar at $1.09370. The dollar was mostly flat against the yen at 120.420 yen. To the upside, immediate resistance can be seen at 1.0940. To the downside, major support level is located at 1.0897 levels.USD/JPY is supported around 120.00 levels and currently trading at 121.44 levels. It hit session high at 120.50 and made session lows at 120.33 levels. The dollar made modest gains  against Japanese Yen on Tuesday after data showed that annualized U.S. single-family home prices rose in October at a slightly faster pace than in September and above market expectations. The S&P/Case Shiller composite index of 20 metropolitan areas gained 5.5 percent in October on a year-over-year basis compared with 5.4 percent in the year to September. On the other hand data on Tuesday indicated consumer sentiment improved, with the Conference Board’s index of consumer confidence for December printing at 96.5, beating the 93.8 analyst’s expectations. A rebound in crude prices which have been pressured lately by concern over global over supply, increased the demand for commodity linked currencies such as Canadian and Australian dollar. The dollar made gains against the yen at 120.420 yen.USD/CAD is supported at 1.3794 levels and is trading at 1.3840 levels. It has made session high at 1.3851 and lows at 1.3809 levels. The Canadian dollar strengthened against its U.S. counterpart on Tuesday, helped by a rebound in crude oil prices, even as the U.S. dollar firmed against a basket of major currencies. Oil prices rose in thin trade amid prospects of colder weather in coming weeks, but the outlook for 2016 remained bearish due to slowing global demand and over supply of crude oil in the market. The currency’s strongest level of the session was C$1.3863, while its weakest level was C$1. loonie, as Canada’s currency is colloquially known, has edged lower since before the Christmas break after oil prices fell more than 3 percent on Monday. To the upside, immediate resistance can be seen at 1.3850. To the downside, major support level is located at 1.3813 levels.NZD/USD is supported around 0.6853 levels and currently trading at 0.6866 levels. It hit session high at 0.6880 and made session lows at 0.6857 levels. The New Zealand dollar inched higher to hit two-month high on Tuesday buoyed by a hunt for yield, while its Australian counterpart edged off highs in thin year-end trade. The New Zealand dollar reached high up to $0.6866, its highest since mid-October, and looked on track for an increase of nearly three cents this month. The kiwi gained some ground against US dollar after the U.S. dollar held near a one-week low against a basket of currencies on some profit-taking in U.S. trade on Monday. To the upside, immediate resistance can be seen at 0.6880. To the downside, major support level is located at 0.6852 levels.Equities RecapEuropean stock markets rose on Tuesday, helped by gains in the banking sector, although weaker mining share prices held back the British market.UK’s benchmark FTSE 100 closed up 0.7, Germany’s Dax ended up by 1.7 percent, France’s CAC finished the day up by 1.5 percent, and Europe’s FTSEurofirst 300 provisionally closes down 1.3 percent.US stocks climbed on Tuesday, buoyed by energy shares as sliding oil prices stabilized and by fairly healthy data on U.S. economic growth, while the dollar fell for a third consecutive session.Dow Jones closed up by 1.07 percent, S&P 500 ended up by 1.05 percent, Nasdaq finished the day up by 1.31 percent.Treasuries Recap Yields on U.S. Treasuries inched higher on Tuesday in light, choppy trading after a disappointing five-year note sale by the Treasury and as recovering oil prices decreased appetite for U.S. government debt.Benchmark 10-year U.S. Treasury notes were last down 24/32 in price to yield 2.308 percent, up from 2.225 late on Monday.Five-year notes were last down 12/32 in price to yield 1.793 percent, up from 1.716 percent on Monday.Commodities RecapOil jumped more than $1 a barrel on Tuesday as colder weather prompted buying a day after prices slid 3 percent, but slowing global demand and abundant supplies from OPEC members will continue to pressure the market, traders said.Brent settled up $1.17, or 3.2 percent, at $37.79 a barrel. WTI closed up $1.06, or 2.9 percent, at $37.87.Gold edged up on Tuesday in response to firmer oil prices, but a rebound in the dollar limited upside momentum for the metal, which appeared poised for a third year of losses amid the prospect of rising U.S. interest rates.Spot gold was up 0.02 percent to $1,069.6 an ounce at 2:17 p.m. EDT (1917 GMT), after losing 0.6 percent in the previous session.Volumes were thin during the last trading week of the year.U.S. gold futures for February delivery settled at $1,068.0 an ounce, little changed from the previous day’s close of $1,068.3.

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