Listless overnight trading has been replaced by renewed enthusiasm among dollar bulls after better than expected US retail sales helped to boost their conviction. USD has both been climbing after US sales beat the street, suggesting that the decline in energy prices may be starting to help consumer spending. USD is up against all other majors on the news and has driven gold back down to $1,150, with JPY, AUD and NZD also underperforming.
Other than the greenback, CAD has been the top performing, falling only marginally against USD. The loonie has picked up a tailwind from a strong rebound in Canadian manufacturing sales to their eighth gain in the last nine months, in a sign that the lower Loonie may be helping a manufacturing sector that had been gutted in recent years. A technical rebound in crude oil prices may also be helping, but WTI and Brent remain well below yesterday’s $80.00 and $77.00 breakdown points.
US indices are trading slightly higher overnight but have not been able to take advantage of the good retail sales news. This suggests that indices reaching all-time highs this week have already priced in the result leaving traders to wonder what it will take to attract the next wave of buyers, particularly with earnings season pretty much over.
European indices have stabilized after getting some help from stronger than expected GDP numbers out of Greece (OPA! Yes really! No I’m not kidding) and Germany helping Eurozone GDP to beat the street slightly. EUR is slightly lower against the strong USD today but the EUR pair that is getting the most attention today is EURCHF which is trading a few pips above the Swiss National Bank’s 1.2000 floor.
Corporate News
Nordstrom $0.73 vs street $0.72, cuts 2015 Jan year guidance to $3.70 to $3.75 from $3.80-$3.90.
Economic News
Economic reports released overnight and this morning include:
US retail sales street 0.2%
US retail ex auto street 0.4%
Canada manufacturing sales street 1.0%
China new Yuan loans 548B vs street 626B
China M2 money supply 12.6% vs street 12.9%
France GDP 0.4% as expected
Germany GDP 1.2% vs 1.1%
Italy GDP (0.4%) as expected
UK construction output 3.5% vs street 4.3%
Greece GDP 1.4% vs street 0.6%
Eurozone GDP 0.8% vs street 0.7%
Eurozone consumer prices 0.4% as expected
Singapore retail sales 5.5% vs street 4.1%
Economic reports due later today include:
9:55 am EST US consumer confidence street 87.5
10:30 am EST US natural gas street 37 BCF vs previous 91 BCF
FOMC Members Bullard, Fischer, and Powell speaking
