20131211

Good morning,

Global markets were not able to sustain the bullish notes following a new round of speculations of when the Fed will begin to taper asset purchases. The was underlined by decent US macro data as well as reports that a budget resolution is close to being concluded. EU stocks turned red for the second day in a row on mixed industrial figures from France and Italy as well as the ECB being on the defensive side, when talking about new stimulus to support the Euro zone. Euro Stoxx closed down 0.9% and in the US, the Dow Jones and S&P closed 0.3% lower, whereas the Nasdaq lost 0.2%.  Despite the rumours of tapering, the US Dollar was still overall on the offer in the European as early US session, but as positioning favored safer assets, investors turned towards fixed income, which sent the USD on the bid against the EUR, GBP and AUD.

In Asia, the negative risk sentiment caused investors to build additional long positions in JPY-pairs, which has made USD/JPY test the Tenkan-Sen in the Ichimoku formation again. The Nikkei lost 0.6%, ASX 200 down 0.8%, while the Hang Seng dropped 1.7%. The drop in Hang Seng can be attributed to concerns of the commencement of the annual Central Economic Work Conference, which will declare the key economic targets for 2014. Analysts are expecting unchanged figures overall (3.5% inflation and 7.5% growth).

Today, the economic calendar is pretty thin, and the key event will be tonight's release of the US Treasury Budget Balance for November, expected at -$140bn, but in addition, Italian BOT and German Schatz auctions could create some volatility.

Have a nice day.