Morning wrap

  • Risk-off moods can be spotted on the global financial markets as China-US tensions are set to remain after signing of ‘Phase One’ trade agreement. US that it will not cut more tariffs until after November elections. Steven Mnuchin added that there is no timeline for ‘Phase Two’ trade talks

  • Signing of ‘Phase One’ trade agreement is scheduled for 4:30 pm GMT. Mnuchin said that trade deal documents will be released today

  • US indices finished yesterday’s session lower with S&P 500 dropping 0.15% and Nasdaq closing 0.24% lower. Dow Jones managed to post 0.11% gain, thanks to solid earnings from JP Morgan

  • Stocks in Asia also trade mixed with Chinese indices losing ground and Nikkei closing 0.52% lower. On the other hand, Australian S&P/ASX 200 added 0.47%

  • Moves on the market are limited with GBP being top gainer and AUD being top laggard. US dollar index trades 0.05% lower

  • Trading on commodity markets is mixed but risk-off tones can be spotted there as well. Precious metals push higher while base metals trade lower. Crude is making a small pullback. Wheat is the best performing agricultural commodity

  • PBOC announced it will boost liquidity by injecting 300 billion yuan through medium term lending

  • According to Reuters report, US Commerce Department drafted a rule that would allow to block exports to Huawei if US components make up more than 10% of product value

  • Preliminary data from Japan for December showed machine tool orders dropping 33.6% YoY

Gold gains today as markets remain concerned about China-US relations. Note that the precious metal painted a pin bar yesterday at the price zone marked by 38.2% Fibo level and previous price reactions. Should the commodity continue moving higher, the recent peak at $1575 could be in play once again. Source: xStation5

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