Market Comment – Monday 2 December 2024
The week starts off with manufacturing and employment data in focus. Germany’s HCOB Manufacturing PMI remains deep in contraction, while Eurozone unemployment stays stable at 6.3%. In the US, the ISM Manufacturing PMI and related indexes are set to provide further insights into economic momentum. Energy prices remain subdued, and the US dollar continues to show mixed movements across currency pairs.
Key Data Out Today
- HCOB Manufacturing PMI (Germany, Nov): Remains unchanged at 43.2, reflecting ongoing weakness in the sector.
- Eurozone Sentix Investor Confidence (Dec): Expected to stay weak, with the previous reading at -12.8.
- Eurozone Unemployment Rate (Oct): Forecast steady at 6.3%, indicating a stagnant labor market.
- US ISM Manufacturing PMI (Nov): Anticipated at 47.5, with the market focused on employment and new orders subindexes.
- Fed Speeches: Waller and Williams are expected to provide further insights into US monetary policy later today.
Energy & Precious Metals
- Crude Oil and Brent: WTI crude is flat at $68.59, while Brent edged up 0.06% to $72.42. Concerns about weak demand and ample supply continue to pressure prices.
- Gold: Slipped 0.94% to $2,632.70 per ounce, with the stronger US dollar weighing on the safe-haven asset.
- Silver: Down 1.21% at $30.24, underperforming gold and reflecting broader weakness in metals.
Currency Movements
EUR/USD
- EUR/USD: Down 0.68% at 1.0505, pressured by weak manufacturing PMI and a stronger US dollar.
GBP/USD
- GBP/USD: Declined 0.37% to 1.2683, as the pound struggles for direction ahead of US data.
AUD/USD and NZD/USD
AUD/USD and NZD/USD: Both currencies are weaker, with AUD/USD down 0.18% to 0.6499 and NZD/USD off 0.27% at 0.5904, reflecting cautious market sentiment.
USD/JPY
- USD/JPY: Up 0.14% to 150.03, as the yen weakens slightly after last week’s gains.
USD/CNY
- USD/CNY: Higher by 0.44% at 7.2799, as concerns over China’s economic recovery weigh on the yuan.
USD/CHF
- USD/CHF: Up 0.33% at 0.8843, reflecting continued dollar strength.
USD/CAD
- USD/CAD: Gained 0.22% to 1.4036, with the Canadian dollar under pressure despite stable oil prices.
USD/MXN
- USD/MXN: Rose 0.41% to 20.46, as the peso remains vulnerable to external pressures.
USD/INR
- USD/INR: Up 0.17% at 84.70, as the rupee continues to struggle near record lows.
Things to Keep a Watch On:
- US ISM Data (15:00 GMT): Manufacturing PMI and subindexes (Employment and New Orders) will offer insights into US economic resilience.
- Fed Speeches (20:15 and 21:30 GMT): Comments from Waller and Williams may provide clues on future rate decisions.
- Energy Prices: Watch natural gas and crude oil for further volatility, as demand concerns dominate.
- Gold and Silver: Precious metals could see further downside if the dollar strengthens ahead of ISM data.
- EUR/USD and USD/CNY: Key pairs to monitor as Eurozone data disappoints and China struggles with economic headwinds.