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Risk-taking was the name of the game during the Asian session, as optimism over a successful tax bill and a lack of fresh catalysts pushed higher-yielding assets higher.

  • Japan’s trade surplus registers at 113.4B JPY in November vs. 40B deficit expected, 322.9B surplus in October
  • Australia’s new motor vehicle sales up by 0.1% vs. 0.0% growth in October

Major Events/Reports:

Japan’s trade report

The world’s third largest economy registered a 113.4B JPY surplus in November, which is much better than the 40B deficit expected by market players but is weaker the 146.5B surplus seen a year earlier.

Exports rose for the 12th consecutive month, this time rocketing by 16.2% from a year ago on stronger demand for chip-making equipment, cars, and steel. Details tell us that shipments rose for all trading partners, with products shipped to the U.S. rising by 13% and shipments to China rising to new record values.

However, imports also popped up by a whopping 17.2% thanks to purchases of electrical machinery, mineral fuels, and raw materials. The Ministry of Finance also cited the 8% decrease in the yen’s value against the dollar, which helped raise import costs.

Broad risk-taking

The combination of optimism for a tax bill in the U.S. and a lack of major economic catalysts helped push equity and commodity prices higher today.

  • Nikkei, which cheered Japan’s strong exports growth, is up by 1.44% to 22,877.50;
  • Australia’s A SX 200 is up by 0.69% to 6,038.20;
  • China’s A50 is up by 0.36% to 12,955.04, and
  • Hang Seng is up by 0.55% to 29,007.00.

Major commodities were also in the risk appetite train.

  • Gold might be steady at $1,257.50 but
  • WTI crude is up by 0.19% to $57.44 and
  • Brent crude oil is up by 0.27% to $63.40.

Major Market Mover(s):

USD and JPY

The lower-yielding currencies took a step back against their higher-yielding counterparts on a bout of risk-taking in the Asian markets.

EUR/USD is up by 19 pips (+0.16%) to 1.1763;
GBP/USD is up by 22 pips (+0.17%) to 1.3336;
AUD/USD is up by 14 pips (+0.18%) to 0.7658, and
NZD/USD is up by 13 pips (+0.19%) to .7011.

Meanwhile,

EUR/JPY is up by 12 pips (+0.09%) to 132.55;
GBP/JPY is up by 19 pips (+0.13%) to 150.27;
AUD/JPY is up by 12 pips (+0.14%) to 86.30, and
NZD/JPY is up by 13 pips (+0.17%) to 79.00.

Watch Out For:

  • 9:00 am GMT: Italy’s trade balance (3.23B EUR expected, 3.99B EUR previous)
  • 10:00 am GMT: Euro Zone’s final CPI (y/y) to remain at 1.5%?
  • 10:00 am GMT: Euro Zone’s final core CPI (y/y) to remain at 0.9%?
  • 11:00 am GMT: German Bundesbank monthly report
  • 11:00 am GMT: U.K. CBI industrial order expectations (14 expected, 17 previous)