5 Jan: Strong private jobs growth send stocks to new highs but fail to help the US$. NFP ahead today.

By | January 5, 2018

 

Despite some solid jobs data ahead of today’s NFP reading the US$ has so far been unable to stage any recovery as the theme of general weakness continues in the first trading weak of the new year. The ADP report showed 250k growth in private sector jobs in December, well above expectation of 190k, while the initial jobless claims rose 5k to 250k in the final week of December. Earlier in the day, the Markit Services/Composite PMIs were released and Markit Manufacturing/Services/Composite PMIs noted that “a stellar end to 2017 for the EU rounded off the best year for over a decade”, which underpinned the Euro and kept the dollar under pressure. The Eurozone PMI services were revised up by 0.1 to 56.6 in December, while the German PMI services were unrevised at 55.8. The French Services PMI was revised lower by 0.3 to 59.1and the Italian PMI figure dropped 0.1 to 54.6 in December but both remained well above their long term trend, while the UK PMI services rose to 54.2 in December, up from 53.8 and beat expectation of 54.0.

In other markets, US stocks roared to yet new highs after the strong private hiring jobs growth and global growth hopes. Oil also remains strong due to the increased hopes of continued economic growth while the metals remain firm on the back of the weaker dollar and improving risk sentiment.

Friday will commence with the Australian HIA New Home Sales and the November Trade Balance (exp +$915 mio). Europe will initially look to the German Retail Sales for guidance ahead of the Provisional EU December CPI (exp 1.3%; Core, 1.0%) and PPI (exp 0.3%mm, 2.4%yy). The main focus though will be on the US unemployment (4.1%)/NFP (+19K)/Average Hourly Earnings (0.3%), which comes ahead of the ISM Non-Mfg and Factory Orders as well as speeches from the Fed’s Harker/Mester and the BOEs Haldane. Have a good weekend.

CURRENCIES
EURUSD: 1.2071
Res  1.2090  1.2120  1.2150
Sup  1.2055  1.2025  1.2000
USDJPY: 112.78
Res  112.85  113.00  113.35
Sup  112.45  112.25  112.05
GBPUSD: 1.3552
Res  1.3560  1.3580  1.3610
Sup  1.3520  1.3490  1.3470
USDCHF: 0.9746
Res  0.9775  0.9800  0.9825
Sup  0.9735  0.9700  0.9670
AUDUSD: 0.7862
Res  0.7865  0.7885  0.7900
Sup  0.7825  0.7805  0.7780
NZDUSD: 0.7157
Res  0.7170  0.7190  0.7210
Sup  0.7130  0.7105  0.7070
INDICES / COMMODITIES
S&P: 2726
Res  2730  2735  2740
Sup  2720  2715  2710
DJI: 25064
Res  25075  25100  25150
Sup  25015  24965  24900
ASX SPI: 6056
Res  6065  6080  6100
Sup  6035  6015  6000
XAUUSD: 1323
Res  1325  1330  1335
Sup  1320  1315  1310
XAGUSD: 17.24
Res  17.30  17.40  17.50
Sup  17.15  17.05  16.95
WTI: 61.95
Res  62.20  62.55  63.00
Sup  61.55  61.10  60.70