CURRENCY MARKET WRAP
As of Mon 24th Dec, Singapore Time zone UTC+8
U.S. Dollar Index, -0.01%, 97.68
USDJPY, -0.10%, $109.39
EURUSD, +0.11%, $1.1092
GBPUSD, -0.48%, $1.2944
USDCAD, -0.01%, $1.3147
AUDUSD, +0.28%, $0.6926
NZDUSD, +0.39%, $0.6633
U.S. New home sales in November increased 1.3% m/m to a seasonally adjusted annual rate of 719,000 units (consensus 735,000) from a downwardly revised 710,000 (from 733,000) in October. On a yr/yr basis, new home sales were up 16.9%. Total durable goods orders declined 2.0% m/m (consensus +1.4%) following a downwardly revised 0.2% increase (from 0.6%) in October. Excluding transportation, durable goods orders were unchanged, as expected, following a downwardly revised 0.3% increase (from 0.6%) in October.
Although not market-moving, China’s decision to lower import tariff rates on approximately 850 commodity products, effective Jan. 1, helped support positive risk sentiment. On a related note, Trump said the Phase One deal should be signed “very shortly.” The market expects the deal to be signed in early January.
U.S. Treasuries finished on a lower note, pushing yields higher across the curve. The 2-yr yield increased two basis points to 1.65%, and the 10-yr yield increased two basis points to 1.94%. The U.S. Dollar Index finished flat at 97.68. WTI crude increased 0.3%, or $0.15, to $60.53/bbl.
Canada’s economy slightly shrank in October with real gross domestic product edging down 0.1 per cent (expected +0.1%), Statistics Canada reports. October’s GDP report said manufacturing was the biggest drag on output. Factory-sector output fell 1.4% to C$197.55 billion, a two-year low. October’s decline was the fourth in five months. Part of the drop was attributed to a strike by members of the United Auto Workers union at General Motors Co. Regardless, weakness in manufacturing was widespread, with declines reported by producers of machinery, wood products and plastics.
STOCK MARKET WRAP
S&P500, +0.09%, 3,224.01
Nasdaq, +0.23%, 8,945.65
Nikkei Futures, +0.24%, 23,777.5
Price action was muted to start the holiday-shortened trading week, as the market traded with modest gains throughout the session. Leadership from Apple, which had its price target raised to $350 from $325 at Wedbush, was an influential force in the broader market.
From a sector standpoint, the S&P 500 energy sector (+1.1%) outperformed amid strength in Apache (APA 26.53, +3.91, +17.3%), and the industrials sector (+0.6%) followed suit amid gains in Boeing (BA 337.55, +9.55, +2.9%) and 3M (MMM 178.47, +3.10, +1.8%). Conversely, the utilities (-1.0%) and real estate (-0.5%) sectors declined the most.
Boeing shareholders reacted positively to Dennis Muilenburg resigning from his positions as CEO and Board director. 3M benefited from JP Morgan upgrading the stock to Neutral from Underweight. Apache pleased investors with a 50-50 oilfield venture with France’s Total (TOT 55.04, +0.67, +1.2%).
In M&A activity, Cincinnati Bell (CBB 10.45, +2.73, +35.4%) agreed to be acquired by Brookfield Infrastructure (BIP 49.14, +0.78, +1.6%) for $2.6 billion in cash. Sports betting company DraftKings will become a public company through its combination agreement with Diamond Eagle Acquisition Corp (DEAC 10.84, +0.67, +6.6%).