Europe Flat as UK MPs Prepare For Brexit Vote
European stocks once again find themselves facing a flat and muted open on Friday, with traders minds clearly on last minute panic shopping than revised growth numbers or consumer surveys.
Source – Thomson Reuters Eikon
It’s been quite a strange week, all things considered. The US President has been impeached, we’ve got a new UK government after it was confirmed around this time last week that the Conservatives have their biggest majority in decades and today, said government will likely pass the EU withdrawal bill.
And yet, this has largely been a week to forget as long as the markets are concerned. I guess when you remove all of the political theatre and strip it down to what what it all means, there’s nothing there that really moves the needle and ultimately, that’s all investors care about.
Trump won’t be impeached by members of his own Republican Party in the Senate, certainly not with a two thirds majority. The UK election result was priced in last week and with it, the passing of the bill. While this may be a forgetful week for the markets, it’s easy to forget it’s been far from a normal week, generally speaking.
It’s also been a data and central bank heavy week and even this has been overlooked to a certain extent. Today we’ll get revised GDP data from the UK, a German consumer survey, Canadian retail sales and some income, spending and inflation data from the US. Whether it will be in any way impactful is another thing. Oh, and the Brexit vote, of course.
US Treasury Secretary Steve Mnuchin sought to assure investors that the phase one trade deal with China will be ready to sign at the beginning of January, after undergoing a “technical scrub”. I’m not quite sure what that means exactly, but hopefully this isn’t the same “done” as we were told in October because those final details took some time to iron out.
Gold coasting into the new year
It’s becoming more and more difficult to write about gold in any kind of interesting way. The yellow metal is coasting its way into the new year and nothing seems to be wobbling it. We’ve had a trade deal, an impeachment and new records in the stock markets and yet gold just shrugs it off. A break above $1,480 would certainly make things more interesting but I’m not optimistic the way things are going.
Gold Daily Chart
Oil extends winning run
Oil is having a strong end to 2019 and on Thursday extended its winning run to six days. Marginal gains are being squeezed out in early trade which may suggest the run is about to come to an end, but broadly speaking, there’s no lack of momentum in the oil rally yet. An OPEC+ deal, US-China trade deal and maybe even an improved global outlook have created quite the bullish case for oil recently and it seems traders think there’s more room to run.
Brent Daily Chart
For a look at all of today’s economic events, check out our economic calendar.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.