Article Highlights

  • German import prices m/m: 0.7% vs. 0.2% expected, 0.9% previous
  • Italian retail sales m/m: 1.2% vs. 0.4% expected, -0.5% previous
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There were only a few items on the calendar, so forex traders apparently turned to the commodities rout for direction, since all the comdolls got whupped during the morning London session.

Major Events/Reports:

Commodities routedCommodities were broadly in retreat during the morning London session.

Precious metals got whupped, despite the modest risk-off vibes.

  • Gold was down by 0.14% to $1,131.65 per troy ounce
  • Silver was down by 0.60% to $15.883 per troy ounce

Base metals, meanwhile, got a severe beat-down.

  • Copper was down by 1.01% to $2.472 per pound
  • Nickel was down by 1.96% to $10,622.50 per dry metric ton

As for oil benchmarks, they were leaking red.

  • U.S. crude oil was down by 0.61% to $52.17 per barrel
  • Brent crude oil was down by 0.55% to $54.13 per barrel

Aside from year-end flows, market analysts also pointed to lower imports from China, which dragged weighed down on metals, base metals in particular. Other market analysts, meanwhile, point to the rise in U.S. oil inventories for the slide in oil prices.

Modest risk aversion – the major European equity indices were little changed today. However, there were signs of risk aversion, since they were mostly printing modest losses.

  • The pan-European FTSEurofirst 300 was down by 0.14% to 1,424.38
  • Germany’s DAX was down by 0.04% to 11,464.25
  • The U.K.’s FTSE 100 was down by 0.06% to 7,037.10

U.S. equity futures were also little changed, but in the red regardless.

  • S&P 500 futures were down by 0.04% to 2,259.50
  • Nasdaq futures were down by 0.03% to 4,948.38

Market analysts point out that mining shares were the worst performers, so the modest risk aversion was apparently linked to the slide in commodity prices. These same market analysts also note that the risk-off mood was offset a bit by outperforming banking shares, supposedly on speculation that Monte dei Paschi’s rescue plan will turn out okay.

Major Market Movers:

Comdolls – All the comdolls (AUD, NZD, CAD) got a good, old-fashioned beat-down during the morning London session, thanks to the broad-based slide in commodity prices. Among the three comdolls, the Loonie had the worst of it, probably because forex traders were also preemptively unwinding or opening positions ahead of Canada’s top-tier economic reports.

AUD/USD was down by 14 pips (-0.20%) to 0.7214, AUD/JPY was down by 18 pips (-0.22%) to 84.85, AUD/CHF was down by 25 pips (-0.33%) to 0.7393

NZD/USD was down by 9 pips (-0.14%) to 0.6903, NZD/CHF was down by 18 pips (-0.25%) to 0.7074, NZD/JPY was down by 12 pips (-0.15%) to 81.20

USD/CAD was up by 42 pips (+0.31%) to 1.3475, AUD/CAD was up by 11 pips (+0.12%) to 0.9722, NZD/CAD was up by 17 pips (+0.18%) to 0.9303

Watch Out For:

  • 1:30 pm GMT: Headline (-0.1% expected, 0.2% previous) and core (-0.1% expected, 0.2% previous) readings for Canada’s CPI
  • 1:30 pm GMT: Headline (0.2% expected, 0.6% previous) and core (0.7% expected, 0.0% previous) readings for Canada’s retail sales
  • 1:30 pm GMT: Headline (-4.9% expected, 4.6% previous) and core (0.2% expected, 0.8% previous) readings for U.S. durable goods orders
  • 1:30 pm GMT: Final estimate for Q3 U.S. GDP growth (upgrade from 3.2% to 3.3% expected)
  • 1:30 pm GMT: U.S. initial jobless claims (257K expected, 254K previous)
  • 2:00 pm GMT: U.S. HPI (0.4% expected, 0.6% previous)
  • 3:00 pm GMT: U.S. core PCE price index (0.1% expected, same as previous)
  • 3:00 pm GMT: U.S. personal spending (0.4% expected, 0.3% previous)
  • 3:00 pm GMT: U.S. personal income (0.3% expected, 0.6% previous)

See also:

Asian Session Recap

U.S. Session Recap

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