Archives of “January 4, 2021” day

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UK reports record 58,784 new covid cases vs 55,157 yesterday

  
Analysis, COVID-19

US cases remain high but pace of growth slows

US cases remain high but pace of growth slows
This is another record in UK cases but it’s only marginally higher than two days ago.
Can we take any comfort in the plateauing of cases in the past week? I don’t because there’s usually a weekend effect on Mondays and we’ve got a record anyway. Given all the holiday mingling and lagged effects of symptoms, it’s tough to see any improvement in the near term, even with lockdowns.
At the present case, one in every 1200 people in the UK is being diagnosed positive every day.

Iraq rumours do the rounds

  
  Analysis

What’s the story?

There is chatter about attack or an attack on US forces in Iraq yesterday but I think this is a case of broken telephone.
An Al-Arabiya correspondent reported that an international coalition convoy had been targeted on Samarra road, north of Baghdad.
Somehow that morphed into vague talk of heavy casualties. I don’t think it’s a real risk for the broader market and the crude market certainly isn’t paying it any mind as the OPEC meeting continues and oil prices fall.

US dollar battles back in early New York trade

  
Analysis, Forex

The dollar started the year off poorly

Dollar weakness is a consensus trade in 2021 as the trend continues. Oftentimes the consensus is wrong but it wasn’t on the dollar — at least in the first few hours of trading.
The dollar is still near the bottom of the major currency market today (ahead of only GBP) but it’s recouped some losses in the past few hours. Some of that comes with Treasury yields ticking higher.
The first big dollar test will be if US 10s rise above 1%. A break of that is a sure thing if Democrats win both seats in tomorrow’s election.
The dollar started the year off poorly

OPEC haggling keeps the oil market on edge Mon 4 Jan 2021 13:37:07 GMT

  
Analysis, Crude

Crude unchanged after earlier jump

Crude unchanged after earlier jump
Brent hit $53.33 and WTI rose to $49.83 earlier but both have given back about $1.40 and are unchanged on the day.
OPEC+ is meeting today to decide whether to stick with the plan of returning another 500,000 barrels per day of production to the market in light of fresh lockdowns and the virus surge.
One report, citing a  source close to the talks said just before today’s meeting that Russia and UAE are insisting on the 500 thousand bpd increase in production but Saudi Arabia, Kuwait and Algeria are pushing to leave production unchanged.
The baseline in the market is for an increase but another report says there is “lots of chatter” about keeping current production levels.
In the bigger picture, 26 of the 29 commodities in the CRB index are higher today with coffee, aluminum and nickel as the only laggards. On top are silver and natural gas.

Dollar continues its struggles into the new year

  
Analysis, Forex

Dollar slips a little further as we get into European morning trade

The dollar is now down to the lows for the day, easing across the board to start the session. The drop comes as risk is also keeping in a better spot with US futures now trading up by 0.3% as we get things underway.

GBP/USD D1 04-01
Cable is up to trade just above 1.3700, breaching the figure level for the first time since May 2018. Meanwhile, EUR/USD has moved back above its 100-hour moving average as buyers seize near-term control in a push to 1.2268.
Elsewhere, USD/JPY is also falling below 103.00 to a session low of 102.94 with commodity currencies posting a modest advance against the greenback.
Going back to cable, the technical picture doesn’t bode too well for the dollar to start the year. The break above the December highs of 1.3619-24 in thin holiday trading has continued and that leaves little in the way of a potential push towards 1.4000.
As mentioned last week, the pound may still find itself struggling despite a Brexit trade deal being achieved but against the dollar, it could still find some upside potential amid the misery in the greenback which appears to be continuing for now.

China says US plans to delist three Chinese telecom firms are “political”

  
  Analysis

New York Stock Exchange (NYSE) plans to delist China Mobile, China Unicom and China Telecom following Trump’s announcement in November last year to bar U.S. investment in 31 firms that Washington says are owned or controlled by the Chinese military.

China’s securities regulator said over the weekend that the delistings are “politically motivated” and that the impact will be “limited”.
Via Reuters:
  • The overall scale of the American Deposit Receipts listed by the three companies is small, it said, with a total market value of less than 20 billion yuan ($3.07 billion), or 2.2% of the total equity of the three firms.

Japan is considering a Tokyo (COVID-19) emergency declaration within a week

  
  Analysis

Coronavirus cases still rising in Japan’s capital. Reports out now that prime Minister Suga is pondering implementing an emergency declaration this week.

Restaurants in Tokyo have been asked to close by 8pm already.
More:

 

  •  Fuji TV with the report that Tokyo and 3 surrounding prefectures could be subject to the declaration of a state of emergency as early as this week.

 

News boosting yen, weighing on Japanese stocks.

OPEC sees plenty of downside risks for oil markets in the first half of 2021

  
Analysis, Crude

Comments from OPEC Secretary-General Barkindo over the weekend, via Reuters.

OPEC meets with its “+” allies on Monday, including of course Russia. Discussions will centre on output levels for February.
“Amid the hopeful signs, the outlook for the first half of 2021 is very mixed and there are still many downside risks to juggle,” said Barkindo.
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