3rd January 2020

·       Asian equities failed to track the Wall Street rally as sentiment took a hit from geopolitical developments

·       Oil prices surged as US air strikes killed Senior Iranian Revolutionary Guard Corp Commander Soleimani; IRGC official vowed revenge against the US

·       North Korea's official newspaper warned of "immediate and powerful" strikes against...

• European bourses are firmer this morning in relatively quiet newsflow for the European session
• USD is firmer this morning, but the DXY remains well off pre-holiday levels after tumbling at year end
• PBOC has cut the RRR for domestic banks by 50bps, the level for big banks now stands at 12.5%
• US President Trump says the US-China trade deal will be signed on January 15th at the White House with high level Chinese Representatives
• North Korean Leader Kim Jong Un has stated that North Korea is no...

PBOC has cut the RRR for domestic banks by 50bps, the level for big banks now stands at 12.5%; this was the 8th cut since early 2018. (Newswires) 

US President Trump says the US-China trade deal will be signed on January 15th at the White House with high level Chinese Representatives, additionally President Trump will at a later date visit Beijing for the Phase Two talks. Note, China is yet to confirm the signing will take place on January 15th at the White House and today’s Mofcom press conference has been...

• European bourses are little changed with a number of market closures already underway
• China Global Times tweeted that hopefully US can move faster towards lowering tariffs after China recently announced new tariff-cut plans on imports
• FX markets are tentative/little changed with the debt complex painting a similar picture
• Looking ahead, highlights include Richmond Fed, APIs, US 5yr. Note, there are several early market closures, all of which...

• Asian equity markets were mixed with price action range-bound amid the ongoing holiday lull
• China Global Times tweeted that “hopefully the US can move faster towards lowering tariffs” after China recently announced new tariff-cut plans on imports
• In FX markets, price action was contained with the DXY languishing below its 200DMA at 97.71
• Looking ahead, highlights include Richmond Fed, APIs, US 5yr. Note, there are several early market closures, all of which are detailed on our...

• European bourses are overall little changed, though the FTSE 100 outperforms as Sterling slips
• China is to lower import tariffs on certain products beginning January 1st in which it will cut some import tariffs on 850 items and will further lower import tariffs for some IT products from July 1st
• North Korean launch sites reportedly look basically ready to go, while other reports note NK Leader Kim is to take a wait and see approach regarding a US deal
• In FX, the USD slightly underperforms most G10...

• Asian equity markets traded somewhat mixed as the region once again failed to follow suit from Friday’s gains on Wall Street
• China is to lower import tariffs on certain products beginning January 1st in which it will cut some import tariffs on 850 items
• Reports suggested President Xi is willing to continue meeting with US President Trump
• In FX markets, currency flows were limited owing to the lack of tier-1 data releases and lighter volumes heading into the holidays
• Looking ahead, highlights...

• European bourses are firmer in choppy quadruple witching trade following on from the US record highs
• US House voted to approve the USMCA trade agreement and the Senate passed the bill to advert a Government shutdown
• UK House of Commons is to vote on UK PM Johnson's Brexit deal today, the bill would also prevent the Government from extending the transition period past 2020; voting is expected at around 14:30GMT/09:30EST
• FX complex is mixed with GBP outperforming slightly after data and ahead of the...

• Asian equity markets traded mixed as the Christmas rally on Wall St failed to filter through to the region
• UK House of Commons is to vote on UK PM Johnson's Brexit deal today at 1430GMT
• FCA Chief Executive Andrew Bailey has reportedly been selected as next BoE Governor, according to the FT
• US House voted 385 vs. 41 to approve the USMCA trade agreement
• Looking ahead, highlights include UK GDP, Canadian Retail Sales, US Personal Income, Consumption, Core PCE, Uni. Of Michigan, EZ Consumer...

• European equities trade lacklustre amid a lack of fresh fundamental catalysts in holiday-thinned trade
• US House voted to impeach President Trump under Article 1 (Abuse of Power) and Article 2 (Obstruction of Congress); as expected
• BoJ kept monetary policy settings were left unchanged, Riksbank hiked, Norges stood pat – all as expected
• Bunds, Gilts and US Treasuries have all extended losses and remain under...

• Asian equity markets were lacklustre following an indecisive lead from US where the major indices finished flat due to a lack of drivers
• BoJ kept monetary policy settings unchanged as expected with NIRP held at -0.1% and 10yr JGB yield target at around 0%, maintained forward guidance
• US House voted to impeach President Trump under Article 1 (Abuse of Power) and Article 2 (Obstruction of Congress); as expected
• AUD/USD was boosted by better than expected Employment data, although the gains were...

• European Equities have been choppy for much of the session, but haven’t drifted too far from the unchanged mark
• US Treasury Secretary Mnuchin said President Trump just wants a level playing field with China and the enforcement mechanism is very strong in the China deal
• US House had enough votes to impeach President Trump with the majority in favour and is expected to conduct a vote today
• FX space is little changed vs. USD, with EUR and GBP failing to derive much support from the sessions...

• Asian equity markets traded mixed as the region lacked conviction in the absence of any fresh catalysts and following a relatively quiet session on Wall Street
• US Treasury Secretary Mnuchin said President Trump just wants a level playing field with China and the enforcement mechanism is very strong in the China deal
• S&P affirmed UK at AA; Outlook revised to Stable from Negative and Fitch affirmed the UK at AA; Outlook revised to Negative from Rating Watch Negative
• US House has enough votes to...

• European equities are mostly lower as the region failed to follow a positive APAC lead, Boeing shares are down 2.0% after freezing 737 Max production
• UK PM Johnson is to bolster his Brexit legislation by outlawing a delay to the transition period with the EU beyond December 2020
• RBA meeting minutes saw the central bank reiterating it has the ability to add further stimulus if needed and is ready to ease again if required
• In FX, DXY hovers...

• Asian equity markets traded mostly higher as the region took mild impetus from the gains on Wall St where all major indices notched fresh record highs
• UK PM Johnson is to bolster his Brexit legislation by outlawing a delay to the transition period with the EU beyond December 2020
• In FX, DXY edged marginal gains above 97.00, helped by strong NAHB data, a recent increase in yields and weakness across major counterparts
• RBA meeting minutes saw the central bank reiterating it has the ability to add...

• European bourses are firmer this morning, though the FTSE 100 significantly outperforms on a second-wave of UK election optimism
• China State Council stated it will continue to suspend additional tariffs on US vehicles and auto parts due to the Phase One deal
• China sources cited by CNBC's Yoon note that the USD 40-50bln target on agricultural purchases is a "best case target"
• Boeing (BA) is mulling cutting or stopping its 737 MAX production, via WSJ – Co. shares are down 2% pre-market
• USD...

• Asian equity markets traded mixed following relatively light newsflow over the weekend, ASX 200 outperformed
• USTR Lighthizer said China agreed to purchase USD 40bln of agriculture in the first year, added the deal will be signed by trade principals in Washington in the first week of January
• US is reportedly weighing 100% tariffs on more EU products including whiskies and cognac amid the fallout of its Airbus dispute
• In FX, the DXY was...

• The result of the UK election exit poll overwhelmingly pointed towards a Conservative majority with a total of 368 seats vs. Labour 191 - Conservatives managed to cross the 326-seat threshold just before 0500GMT
• GBP immediately saw strength following the election exit poll with GBP/USD eclipsing 1.3500 to the upside from mid-1.3100 area
• China and the US have struck an agreement on some tariff reductions and a delay to the tariffs that were due to come into effect on...

• The result of the UK election exit poll overwhelmingly pointed towards a Conservative majority with a total of 368 seats vs. Labour 191 - Conservatives managed to cross the 326-seat threshold just before 0500GMT
• GBP immediately saw strength following the election exit poll with GBP/USD eclipsing 1.3500 to the upside from mid-1.3100 area
• China and the US have struck an agreement on some tariff reductions and a delay to the tariffs that were due to come into effect on...

• European equities are choppy and ultimately flat ahead of a deluge of risk events
• US President Trump is likely to meet with top trade advisers on Thursday regarding December 15th tariffs, according to sources
• Half of the latest UK Election Polls show a maintenance in the Tory/Labour spread and the other half show a slight narrowing
• SNB left Monetary Policy settings unchanged, whilst CBRT conducted a deeper-than-forecast cut and maintained their stance
• Looking ahead highlights include, UK...

• FOMC left its Fed Fund Target Rate unchanged at 1.50%-1.75% as expected via unanimous decision while it maintained the IOER at 1.55%
• Fed dropped its language from the statement regarding uncertainties for the outlook remaining
• Fed Dot Plots show a median view for an unchanged rate throughout 2020 and a single hike in 2021 followed by another in 2022, although some see a 2020 hike as likely to be appropriate
• Fed Chair Powell also said that a...

• European bourses are mixed/flat at present, as newsflow remains light ahead of the impending risk events
• White House Trade Advisor Navarro said China is trying to shape the narrative on trade talks and he believes the Dec 15th tariffs won’t come into effect
• YouGov’s MRP model showed Conservatives are on track for a 28-seat majority vs. Prev. forecast of 68-seat majority
• Looking ahead, highlights include US CPI, DoEs, US FOMC Rate Decision and Press Conference, OPEC Monthly Oil...

• A non-committal tone persisted across Asia-Pac equity markets following conflicting US-China trade headlines
• White House Trade Adviser Navarro said he has no indication the December tariffs won't be put on
• YouGov MRP model showed Conservatives are on track for a 28-seat majority vs. Prev. forecast of 68-seat majority
• GBP lagged, USD eked mild gains ahead of the FOMC policy announcement, EUR/USD was contained just shy of 1.1100
• Looking ahead, highlights include Swedish and US CPI, DoEs, US...

• European bourses are significantly subdued, as this morning’s stock sell-off accelerates and spreads across markets
• GBP outperforms ahead of tonight’s MRP, with the DXY continuing to print fresh session lows
• A US-China trade deal is not expected this week with the US occupied by USMCA, although new tariffs are not expected according to Chinese press reports
• US House Speaker Pelosi stated that a USMCA trade deal is not agreed to, are close but not yet there
• Looking ahead, highlights include...

• Asian equity markets resumed the cautious global risk tone heading into this week’s plethora of risk events
• There were unconfirmed reports citing a trade source which noted the December 15th tariffs are going ahead and that China is preparing for them
• However, Chinese reports suggested a US-China trade deal is not expected this week with the US occupied by USMCA, although new tariffs are not expected
• Looking ahead, highlights include Norges Bank Reginal Network Report, UK GDP, Production Trade,...