Daily Analysis - 27/12/2019
The famous greenback floated near a half a year top against the safe-haven Japanese yen. As the greenback was getting stronger the Australian dollar also rose to its highest level since July on Friday, supported by the positive signs from the China-US trade matter. The confidence regarding prospects for a Phase 1 trade agreement decreased the need for safe-haven currencies like the yen. However, with global currency markets in a holiday state following Christmas Day on Wednesday, the overall trading action was mostly restrained.
On Friday oil increased scoring a 90-day top following figures that revealed record online spending by US buyers, boosting the confidence for the world’s greatest economy. That happened even before the anticipation for a resolution of the trade conflict between the US and China. Brent crude futures gained 6 cents and reached the $67.97 a barrel while WTI rose 11 cents, to $61.80 a barrel.
Investors are preferring to support traditional assets as the US-China trade deal enters “period one” at the beginning of this month. The US and China are processing the agreement, trying to confirm the deal in early January. Dow futures gained 45 points, pointing to a stronger start of more than 50 points. Futures on the S&P 500 and Nasdaq also increased.
According to a regulatory filing yesterday the famous electric car maker Tesla agreed with China lenders to get a loan facility of $1.29 billion. Tesla announced that it has also approved contracts for an unsecured revolving loan facility of up to 2.25 billion yuan, combining two loans and will be used for its Shanghai car factory. Tesla’s Shanghai factory is the first car construction place outside the US and is the center of its hopes to increase sales in the world’s largest auto market, and bypass more expensive import taxes forced on US-made cars.
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