Wall Street boosted by strong US jobs report
The highest number of US jobs added to the economy in 10 months gave the green light to risk appetite on Friday, and it looks to extend into today’s activity. China had earlier trimmed banks’ reserve ratio requirements on Friday, which had set risk on an upward trajectory. US and China restart trade negotiations today.
US30USD Daily Chart
The US30 index posted the biggest one-day gain in six days after the US economy added 312,000 jobs in December, well above estimates for a 177,000 gain.
The index is nearing the 50% retracement of the December drop at 23,760
Today sees the release of the ISM non-manufacturing PMI for December, which is expected to slide to 59.7 from 60.7.
DE30EUR Daily Chart
The Germany30 index jumped to a seven-day high after the US jobs data. Euro-zone Dec. advance CPI moved back below the ECB target for first time in 7 months, with oil being a contributing factor
The 55-day moving average is at 11,167. This average has capped prices on a closing basis since August 29
Germany’s factory orders are expected to fall 0.5% m/m in November, the first monthly contraction in four months, following a 0.3% increase in October.
The China50 index surged the most since Oct. 22, reaching a two-week high, after the PBOC trimmed banks’ reserve requirements by a full percentage point on Friday
The 55-day moving average is at 10,965 and has capped prices on a closing basis since Dec. 3
The mid-level trade talks are not expected to produce any major breakthrough this time, with the 90-day tariff truce ending in March. Issues under discussion are likely to include: intellectual property; Huawei Technologies and 5G; Beijing’s “Made in China 2025” plan; energy; agricultural imports; auto tariffs and market access for banks.
