View our guide on how to interpret the FX Dashboard.
- Following peak “WW3” fears in overnight trade, cooler heads prevailed as news spread that there were no US causalities from the Iranian missile strikes and no immediate plans for further strikes. In a speech this morning, President Trump emphasized economic sanctions, rather than further military actions, in response to the attacks.
- That said, late headlines of explosions in Baghdad’s “Green Zone” may keep traders on edge again heading into Asian session trade.
- US data: The ADP Employment report (Dec) came in at 202k vs. 160k expected. Combined with upward revisions to previous reports, traders are more optimistic heading into Friday’s NFP report.
- FX: The New Zealand dollar was the strongest major currency on the day, while the safe haven Japanese yen was the weakest as geopolitical fears receded.
- Commodities: In a truly massive move, oil prices (WTI, -4%) traded as high as 65.60 before reversing to trade down to a low near $59 intraday, driven by receding fears of military action in the Middle East and a surprising buildup in inventories. The prices of gold (-1%) and bitcoin (-2%) followed similar, if less dramatic, intraday paths.
- US indices closed higher as prices recovered from their overnight swoon. European indices also closed in the green, led by a 0.7% gain in Germany’s DAX.
- Technology (XLK) was the strongest major sector on the day. Energy (XLE) was the weakest, and the only sector to fall, dragged down by falling oil prices.
- Stocks on the move:
- Boeing (BA) ticked -2% lower after one of its planes experienced a crash near Tehran, killing all 167 passengers and 9 crew members on board.
- Pharmacy Walgreen’s Boost Alliance (WBA) slid -6% after missing analyst earnings and revenue estimates.
- Retailer Macy’s (M) tacked on 2% after reporting solid holiday sales.
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.