As of Sat, Jan 05, 08:00 Singapore Time zone UTC+8
USDJPY, +0.64%, $108.53
EURUSD, +0.04%, $1.1395
GBPUSD, +0.81%, $1.2730
USDCAD, -0.81%, $1.3368
AUDUSD, +1.65%, $0.7121
NZDUSD, +0.64%, $0.6731
S&P500, +3.43%, 2,531.94
Nasdaq, +4.26%, 6,738.86
Nikkei Futures, +3.49%, 20,082.5
CURRENCY MARKET WRAP
- Nonfarm payrolls exceeded expectations with an increase of 312,000, while average hourly earnings increased 0.4%, lifting the year-over-year growth rate to 3.2%. There were some market concerns about how the Fed would respond to the strong jobs report. The latest comments from Powell, however, eased those concerns, evident from stocks soaring to session highs, and maintaining their gains. Some talking points from the Fed Chair that soothed the market included:
- The Fed will remain patient given the muted reading on inflation,
- Monetary policy will be nimble and shift if necessary, and
- His softer tone regarding previous comments on the Fed’s balance sheet reduction path being on autopilot.
- U.S. Treasuries ended the week sharply lower, surrendering their gains from Thursday. The 2-yr yield dropped 10 basis points to 2.48%, and the 10-yr yield dropped 11 basis points to 2.66%. The U.S. Dollar Index lost -0.1% to 96.17.
STOCK MARKET WRAP
- The S&P 500 gained 3.43% on Friday, as Powell signaled patience and flexibility on rates in light of stronger-than-expected jobs data. Friday’s gains helped the benchmark index secure a weekly gain of 1.9%. All 11 S&P 500 sectors closed the session in the green, with gains ranging from 1.0% (real estate) to 4.4% (information technology). Apple (AAPL 148.26, +6.07, +4.3%), for its part, recouped nearly half of its losses from Thursday.The CBOE Volatility Index (VIX) fell 4.1 points to 21.38, reaching its lowest level since mid-December.
Kraken Swamped by US Subpoenas, AMD Partners Crypto Studio
The popular cryptocurrency exchange Kraken has released statistics about the volumes and global breakdown of its information requests from authorities during 2018. The data shows that the number of subpoenas has almost tripled from just 160 in 2017 to 475. The numbers also highlight how much of a burden complying with American demands actually is. New York-based trading platform Gemini has launched a controversial marketing campaign across NYC. Ads posted on outdoor billboards, subway stations and taxis by the exchange are proclaiming that “The Revolution Needs Rules” and “Crypto Without Chaos” suggesting that government regulations are good for investors. Also, Consensys, the crypto software studio that was reported to cut over half of its employees last month, has teamed up with one of the companies that suffered most from the decline in the sale of GPUs to cryptocurrency miners last year – AMD. In collaboration with Abu Dhabi-based Halo Holdings, they will develop optimized data-center solutions for emerging blockchain workloads through the creation of W3bcloud. The initiative is focused on providing an independent cloud computing blockchain infrastructure and plans to develop optimized solutions powered by AMD hardware.
Crypto-Friendly Statesman Takes Over Swiss Presidency
On Dec. 5, Ulrich ‘Ueli’ Maurer was elected by the Swiss parliament for a one-year term in 2019 with the impressive support of 201 out of 209 members. Ueli Maurer is among those politicians who saw the threat to Switzerland’s leadership in the crypto space. In May, he invited representatives of the Swiss financial regulator Finma, the Swiss National Bank, and the Swiss Bankers Association (SBA) to a roundtable discussion on the matter. Following the meeting, SBA formed a working group to solve the problem. It was tasked to create a set of procedures for banks to follow when opening accounts for entities transacting with cryptocurrencies. Some Swiss banks have since then started to accept clients from the crypto sector. During the G20 finance ministers’ meeting in Buenos Aires last July, Maurer shared his country’s position on cryptocurrencies, emphasizing that digital assets and distributed ledger technologies bring great potential for financial services. At the summit, Switzerland also insisted on a uniform international approach in order to prevent double taxation in the digital economy.
Thousands of Banned Binance Customers Remain Cut off by the Exchange
Binance, the world’s second largest digital asset exchange by traded volume, has withdrawn its services from countries targeted by U.S. economic sanctions, in line with its controversial revised terms of use. However, the ban affects entire populations in countries such as Zimbabwe, where U.S. restrictions are supposed to specifically target individuals and companies. Binance users in Iran, Belarus, Serbia, Bosnia, Myanmar and other restricted jurisdictions have reportedly been cut off for a month now after the global exchange sent a notice of termination. Although Binance’s terms now prohibit individuals and countries on the U.N. Security Council and the Office of Foreign Assets Control of the U.S. Treasury Department (OFAC) sanctions lists, Russia is conspicuously exempt. The latest Binance terms of use read, in part, “By accessing and using Binance and any of its services, you acknowledge and declare that you are not on any trade or economic sanctions lists, such as the UN Security Council Sanctions list or OFAC.” These sanctions typically freeze assets of targeted countries, curtail financial transfers to individuals or states as well as suspend services to those on the embargo list.