HIGH IMPACT NEWS RELEASES:
Far East: AU- Trade
Europe: CH- CPI, EZ- Retail PMI, PPI, GB- Service PMI
North America: US- ADP Jobs, Weekly Jobless, Service PMIs, Natural Gas, EIA Crude
- U.S. stocks closed just shy of record levels on Wednesday following the release of the Federal Reserve’s policy minutes from its December meeting and a strong showing in auto sales.
- The S&P 500 index SPX, +0.57% closed up 12.92 points, or 0.6%, to 2,270.75, led by gains in the consumer-discretionary sector, which includes car makers, and the materials sector. The finish was just shy of the S&P 500’s closing record of 2,271.72 set Dec. 13. Gains were broad-based, with nine of the 11 main sectors ending the session in the green.
- The U.S. dollar fell on Wednesday, pulling back from a 14-year high following the release of commentary from the Federal Reserve.While the dollar had already been weaker against its major rivals, it extended its decline following the release of minutes from the Fed’s December meeting, with a key currency index dropping to its lows of the session.
- Europe’s benchmark stock index failed to push further into bull-market territory on Wednesday, with major retailers sliding after a downbeat forecast from Next PLC and drugmakers falling after a round of broker downgrades.
- The Stoxx Europe 600 index SXXP, -0.12% fell 0.1% to end at 365.26 after closing at the highest level since December 2015 on Tuesday. The benchmark on Tuesday also entered a bull market, defined as a rally of more than 20% from recent lows.
- The euro EURUSD, +0.3718% rose to $1.0479 from $1.0406 late Tuesday in New York. The euro was also supported by inflation data in the eurozone, which showed inflation rose to 1.1% in December, up from 0.6% in November and beating analyst forecasts.
- U.K. stocks staged a late-session surge and erased earlier losses to finish at a record, supported by a rise in home-builder and bank shares.
- The FTSE 100 index UKX, +0.17% rose 0.2% to finish at 7,189.74, marking an all-time closing high for a fifth straight session.
- The pound GBPUSD, +0.1542% was at $1.2319 from $1.2232, a move of 0.7%. Despite the rise on the day, Britain’s currency continues to trade near multidecade lows, as it has since the country voted to leave the European Union in late June.
- Japan equities kicked off the new year sharply higher on Wednesday, amid a robust outlook for the U.S. economy and a positive signal for Japanese manufacturing, as well as expectations of continued yen weakness.
- The Nikkei Stock Average NIK, -0.18% ended up 2.5% at a 13-month closing high, helped by gains in financial and export-oriented stocks, as trading resumed after a four-day holiday weekend. It was the first time since 2013 that the index closed up on the first trading day of the year.
- The yen USDJPY, -0.51% also rose, with the dollar fetching ¥117.38, down from ¥117.71 late Tuesday in New York. The dollar is slightly under a high last reached in February 2016.
- Gold futures touched a nearly four-week high Wednesday on short covering as the U.S. dollar eased, but trading was described as cautious ahead Federal Reserve minutes and as the Dow Jones Industrial Average remains within striking distance of the 20,000 level.As of 12:15 p.m. EST, Comex February was $4.40 higher to $1,166.40 an ounce. March silver was up 9.1 cents to $16.50.February gold traded as high as $1,168.60, its most muscular level since Dec. 9. However, the contract also remained in a relatively narrow range of roughly $12.
EURUSD: The most likely scenario for the pair is going down to the nearest target of 1.0418.
EURJPY: The most likely scenario for the pair is going up to the nearest target of 123.25.
GBPUSD: The most likely scenario for the pair is going down to the nearest target of 1.2243.
GBPJPY: The most likely scenario for the pair is going up to the nearest target of 145.01.
USDJPY: The most likely scenario for the pair is going up to the nearest target of 117.92.
XAUUSD: The most likely scenario for the pair is going up to the nearest target of 1,168.4.