Here are the latest developments in global markets:
FOREX: Upbeat data on December’s composite PMI for the Eurozone published on Thursday lifted euro/dollar towards 1.2052 (+0.32%), reversing most of yesterday’s losses as the figures suggested a faster Q4 growth for the region. Pound/dollar also gained from better-than-expected survey data, rising to 1.3554 (+0.24%). The dollar, on the other hand, was in the backfoot against six major currencies at 91.95 (-0.23%) unable to gain further from Wednesday’s economic numbers and Fed meeting minutes. Dollar/yen was flat at 112.60 and dollar/loonie inched down to 1.2517 (-0.12%). The kiwi was the best performer as stronger global commodity demand and a weaker dollar underpinned the currency, with kiwi/dollar surging to 0.7124 (+0.48%).
STOCKS: European stocks gained momentum after the release of the Eurozone data underlined the economic strength of the block, following their Asian counterparts which reached fresh highs overnight. The benchmark STOXX 600 and the blue chips STOXX 50 were up by 0.50% and 0.44% respectively at 1100 GMT. The German DAX 30 jumped by 0.94% driven by gains in industrial and financial sectors, while the British FTSE 100 touched an all-time high thanks to a rally in oil shares. However, the index latest steadied as losses in retail sectors offset part of the gains. US stock futures were pointing to a positive open.
COMMODITIES: Oil prices were mixed after reaching more than two-year highs earlier on Thursday on the back of anti-government protests in Iran (OPEC’s third largest producer). WTI crude increased by 0.21% to $61.76 per barrel but Brent was weaker by 0.16% at $67.75. Gold was trading flat on the day at $1,313.50 per ounce.
Day ahead: ADP nonfarm employment report attracts attention
Traders will keep a close eye on the dollar as several economic releases are expected to move the currency during the European trading hours.
At 1315 GMT, the ADP nonfarm payrolls report which tracks changes in the US private sector employment is expected to show that the number of workers increased by 190,000 in December, as in November. The report is considered as a good predictor of the all-important nonfarm payrolls due on Friday which indicates employment trends in both the private and public sectors. A few minutes later, the US Department of Labor will publish figures on initial jobless claims for the week ending December 29.
Meanwhile in Canada, producer prices are anticipated to rise by 0.8% m/m in November after touching the highest growth in a year of 1.0% in the previous month.
In terms of public appearances, St. Louis Fed President, James Bullard (a non-voting FOMC member) is scheduled to give a presentation on the US economy and monetary policy at 1830 GMT.
At 1600 GMT, the EIA report which measures weekly changes in US oil inventories is projected to bring some volatility to oil prices. Forecasts are for crude oil inventories to fall by a larger amount of 5.148 million barrels compared to a reduction of 4.609 million barrels in the preceding week. That would be the seventh week of declines for the US crude stocks.
