Market Talk – January 8, 2021

ASIA:

Against the backdrop of possible US sanctions on the $5.4 billion deal with Russia for S-400 air defense systems, India on Friday said it has an independent foreign policy that guides defense acquisitions in line with national security interests. Recent reports have suggested the US could impose secondary sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA). The Russian side has said the deal for five S-400 systems is progressing according to schedule despite the threat of possible sanctions.

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 increased 648.90 points or 2.36% to 28,139.03
  • Shanghai decreased 6.10 points or -0.17% to 3,570.11
  • Hang Seng increased 329.70 points or 1.20% to 27,878.22
  • ASX 200 increased 45.90 points or 0.68% to 6,757.90
  • Kospi increased 120.50 points or 3.97% to 3,152.18
  • SENSEX increased 689.19 points or 1.43% to 48,782.51
  • Nifty50 increased 209.90 points or 1.48% to 14,347.25

 

The major Asian currency markets had a mixed day today:

  • AUDUSD decreased 0.0032 or -0.41% to 0.77383
  • NZDUSD decreased 0.0027 or -0.38% to 0.72371
  • USDJPY increased 0.17 or 0.16% to 103.98
  • USDCNY increased 0.00628 or 0.10% to 6.47274

 

Precious Metals:

  • Gold decreased 73.89 USD/t oz. or -3.86% to 1,838.61
  • Silver decreased 2.24 USD/t. oz or -8.26% to 24.867

 

Some economic news from last night:

Japan:

Household Spending (MoM) (Nov) decreased from 2.1% to -1.8%

Household Spending (YoY) (Nov) decreased from 1.9% to 1.1%

Foreign Reserves (USD) (Dec) increased from 1,384.6B to 1,394.7B

South Korea:

Current Account (Nov) decreased from 11.66B to 8.97B

Indonesia:

FX Reserves (USD) (Dec) increased from 133.60B to 135.90B

 

Some economic news from today:

India:

FX Reserves, USD increased from 580.84B to 585.32B

Japan:

Coincident Indicator (MoM) (Nov) decreased from 4.6% to -0.3%

Leading Index (MoM) (Nov) increased from 1.0% to 2.3%

 

EUROPE/EMEA:

A growing number of retailers and courier firms are suspending or cutting back deliveries into the EU as companies grapple with new border controls as well as import taxes. On Friday, DPD, the international delivery giant, said it was “pausing” its road service from the UK into Europe, including the Republic of Ireland. Separately, Marks & Spencer said it was concerned that a third of the products in its Irish food halls, including Percy Pig sweets, would now be subject to import tariffs. Such taxes could spell higher prices for shoppers.

The major Europe stock markets had a green day:

  • CAC 40 increased 37.03 points or 0.65% to 5,706.88
  • FTSE 100 increased 16.30 points or 0.24% to 6,873.26
  • DAX 30 increased 81.29 points or 0.58% to 14,049.53

 

The major Europe currency markets had a mixed day today:

  • EURUSD decreased 0.00696 or -0.57% to 1.21988
  • GBPUSD decreased 0.00103 or -0.08% to 1.35573
  • USDCHF increased 0.0004 or 0.04% to 0.88565

 

Some economic news from Europe today:

Germany:

Gemran Current Account Balance n.s.a (Nov) decreased from 22.5B to 21.3B

German Exports (MoM) (Nov) increased from 0.9% to 2.2%

German Imports (MoM) (Nov) increased from 0.4% to 4.7%

German Industrial Production (MoM) (Nov) decreased from 3.4% to 0.9%

German Trade Balance (Nov) decreased from 18.2B to 16.4B

Swiss:

Unemployment Rate n.s.a. (Dec) increased from 3.3% to 3.5%

Unemployment Rate s.a. (Dec) remain the same at 3.4%

Norway:

Manufacturing Production (MoM) (Nov) increased from 0.6% to 1.5%

France:

French Consumer Spending (MoM) decreased from 3.9% to -18.9%

French Current Account (Nov) increased from -3.70B to -1.40B

French Exports (Nov) increased from 38.9B to 39.3B

French Imports (Nov) decreased from 43.5B to 42.9B

French Industrial Production (MoM) (Nov) decreased from 1.9% to -0.9%

French Reserve Assets Total (Dec) increased from 184,544.0M to 189,505.0M

French Trade Balance (Nov) increased from -4.6B to -3.6B

UK:

Halifax House Price Index (MoM) (Dec) decreased from 1.0% to 0.2%

Halifax House Price Index (YoY) decreased from 7.6% to 6.0%

Italy:

Italian Public Deficit (Q3) decreased from 11.2% to 9.4%

Italian Monthly Unemployment Rate (Nov) decreased from 9.5%b to 8.9%

Spain:

Spanish Business Confidence increased from -7.7 to -7.6

Euro Zone:

Unemployment Rate (Nov) decreased from 8.4% to 8.3%

US/AMERICAS:

Tesla and SpaceX founder Elon Musk became the richest man in the world yesterday after accumulating $185 billion. Musk surpassed Amazon founder Jeff Bezos who is worth $184 billion, and Bill Gates who is worth of $132 billion. According to CNBC, Musk acquired more wealth than Gates’ entire net worth in the past year. Musk commented, “How strange,” upon learning the news.

During Friday’s open, Tesla beat out Facebook to become the most valuable company in America. After jumping over 5% in early morning trading, Tesla’s market cap grew to $802.6 billion, overpowering Facebook’s market cap of $755.8 billion. Tesla became the first US carmaker publically listed for $100 billion last January and gained more than 700% in traction in 2020 alone. The automaker joined the ranks of the S&P 500 in December, further aiding it’s bull run. The company plans to sell close to half a million vehicles in 2021.

In December, the US economy experienced the most significant loss in jobs since April, which was the heat of US lockdowns, according to the Labor Department. Although economists generally expected an increase of 50,000 positions, nonfarm payrolls shed by 140,000 largely due to increased lockdown measures. Many are hoping that the latest coronavirus relief bill and increased PPP funding will help to push January’s figure lower. The unemployment rate in the US remains at 6.7%.

The jobless rate in Canada rose to 8.6% in December amid stringent lockdown measures. Similar to the US, this is the first time the job market has contracted since the heat of the pandemic (Spring 2020) after losing 63,000 jobs. The pessimistic figure was to be expected after places such as Quebec and Ontario re-entered lockdowns in December. However, the figure surpasses Bloomberg analysts estimate of 39,000 positions. The service sector accounted for the majority of losses after shedding 56,700 jobs.

US Market Closings:

  • Dow advanced 56.84 points or 0.18% to 31,097.97
  • S&P 500 advanced 20.89 points or 0.55% to 3,824.68
  • Nasdaq advanced 134.49 points or 1.03% to 13,201.97
  • Russell 2000 declined 5.23 points or -0.25% to 2,091.66

Canada Market Closings:

  • TSX Composite advanced 14.5 points or 0.08% to 18,042.07
  • TSX 60 advanced 2.52 points or 0.24% to 1,072.92

Brazil Market Closing:

  • Bovespa advanced 2,690.71 points or 2.2% to 125,078.63

ENERGY:

 

The oil markets had a mixed day today:

 

  • Crude Oil increased 1.05 USD/BBL or 2.07% to 51.8800
  • Brent increased 1.24 USD/BBL or 2.28% to 55.6200
  • Natural gas decreased 0.025 USD/MMBtu or -0.92% to 2.7040
  • Gasoline increased 0.0503 USD/GAL or 3.39 % to 1.5330
  • Heating oil increased 0.0328 USD/GAL or 2.13% to 1.5709

 

  • Top commodity gainers: Gasoline (3.39%), Brent (2.28%), Heating Oil (2.13%) and Coal (3.11%)
  • Top commodity losers: Gold (-3.86%), Silver (-8.26%), Platinum (-5.12%), and Palladium (-2.88%)

The above data was collected around 14:11 EST on Friday.

BONDS:

Japan 0.05%(+1bp), US 2’s 0.13%(-0.004%), US 10’s 1.10%(+3bps); US 30’s 1.85%(+0.009%), Bunds -0.52% (+2bp), France -0.32% (-0bp), Italy 0.51% (-2bp), Turkey 12.71% (-2bp), Greece 0.60% (-2bp), Portugal -0.01% (-3bp); Spain 0.04% (-1bp) and UK Gilts 0.29% (+0bp).

 

  • Japan 30-Year JGB Auction remain the same at 0.648%