The Santa rally has come, according to the market.
Friday, December 24, 2021 forex news
It’s all quiet as we wind down to the festive period. FX is relatively little changed but US futures are pointing higher after yesterday’s advance, sticking with the Santa Claus rally. There’s not much else to really point out as liquidity conditions are rather thin, so make what you will of price action in the market during this time.
Wall Street’s main indexes registered significant gains for the third straight day, with the S&P 500 closing at a record high, as optimistic developments eased investors’ concerns about the economic impact of the Omicron coronavirus type. — Real-time strategy.
- The US dollar (USDIndex 96.00) has fallen further and is enjoying its worst week since September. US stocks surged to new highs, yields rose, while US oil and gold both maintained robust increases. Santa is taking a risk after strong US data and positive Omicron news improved mood. Asian markets have resumed their upward trend.
- US Yields 10yr traded closed at 1.4903%, having breached 1.50%.
- Equities – USA500 +29 (+0.62%) at 4725 (0.5% above key 4700) NASDAQ +085%, #TSLA +5.76% Eli Lilly +2.48%, PFE -1.41% – For the week, the S&P 500 rose +2.3%, the Dow gained about +1.7% and the Nasdaq climbed +3.2%. S&P Futures were up 0.66%.
- USOil – rallied again $73.54, before settling at 73.32.
- Gold – spiked to $1810 on the weaker USD, and holds at 1808.
- Bitcoin rallied +4.5% with the risk-on mood, breaching 50k and trades at 51k now.
- FX markets – EURUSD 1.1325, USDJPY holds up at 114.34, Cable breached 1.3400 and trades at 1.3410 now.
Dow futures +0.34% at 35870
S&P futures +0.35% at 4710
Nasdaq futures +0.25% at 16291
FTSE +0.45% at 7352
Dax +0.8% at 15692
Euro Stoxx +0.7% at 4247
Omicron Fear Ease
US stocks are heading for a positive start as Omicron fears continue to recede and optimism surrounding the economic outlook builds.
All major US indices are set to end the week higher as an increasing number of studies show that fewer patients need hospital treatment with Omicron compared to Delta. This raises expectations that the Omicron variant won’t derail the global economic recovery.
Adding to the upbeat news, AstraZeneca confirmed that three doses of its COVID vaccine provides protection against Omicron, meanwhile Novavax has said that two shots of its COVID vaccine triggered an immune response to Omicron.
Data wise, investors had plenty to digest. US PCE index, the Fed’s preferred measure for inflation rose to 5.7% in November, up from 5% in October and ahead of the 5.7% forecast.
Initial jobless claims fell last week to 205k, down from 206k the previous week and in line with forecasts.
Furthermore US durable goods orders rose 0.8% MoM ahead of the 0.6% rise expected and up from 0.3% in October.
With inflation elevated and the labour market improving the data supports the more hawkish Fed that we saw in the latest Fed meeting.