Sydney - The dollar headed for a weekly loss and gold
traded at the highest price in almost two months as investors continued to
assess whether market moves since the US election have gone too far. European
stocks and US equity futures climbed and Chinese shares fell after data on
exports.
The US currency fluctuated after touching the lowest
point in almost a month on Thursday. The Stoxx Euro 600 Index rebounded from
its biggest drop since the end of November as Federal Reserve Chair Janet
Yellen reiterated that the US economy is doing well. The Shanghai Composite
Index fell to its lowest level of the year as data showed China’s overseas
shipments remain subdued. Gold increased for a fifth day.
In a week characterised by a reversal in many of the
market moves seen since Donald Trump’s election, Friday will see the release of
a report on US holiday-season retail sales as well as earnings from Bank of
America, JPMorgan Chase & Company, and Wells Fargo & Company. Since
Trump’s victory, the dollar and global equities have rallied, while bonds sold
off amid expectations for improved US growth. Investors unwound some of those
wagers Thursday after the president-elect’s first press conference since the
November victory.
The lack of details from Trump “was probably more
concerning for markets as it highlights how markets have run ahead of
themselves.,” Savanth Sebastian, Sydney-based analyst at Commonwealth Bank of
Australia, said by phone. He added that while the domestic Chinese economy
still seems to be holding up reasonably well, the data “highlights the
risks to exports with the Trump administration going forward and
protectionist-style policies.”
The US economy is doing well, with inflation now pretty
close to the Fed’s 2 percent target, Yellen said at a town hall meeting.
The central bank should begin discussing how to shrink its bloated balance
sheet this year, according to three regional Fed presidents who stepped up
pressure for a debate on when to unwind emergency-era measures that the Fed
preferred to postpone.
Stocks
The Stoxx Euro 600 Index climbed 0.5 percent at 8:21 a.m.
London time, rebounding from a 0.7 percent drop on Thursday. Futures on
the S&P 500 Index added 0.1 percent after the gauge slid 0.2 percent on
Thursday. Japan’s Topix index rose 0.6 percent, paring a weekly
decline. South Korea’s Kospi index lost 0.5 percent as the central bank
left its key interest rate at a record low. The Shanghai Composite Index
slid 0.2 percent in a fourth day of losses, the longest run since October. Overseas
shipments dropped 6.1 percent from a year ago in December, China’s customs
administration said. Hong Kong’s Hang Seng added 0.5 percent.
Currencies
The Bloomberg Dollar Spot Index, a gauge of the greenback
against 10 major peers, lost 0.1 percent after falling 0.5 percent on Thursday.
The gauge is down 0.7 percent for the week. Turkey’s lira slipped 0.9
percent after surging 2.8 percent against the dollar on Thursday. The currency
is down 4.2 percent this week after touching the lowest point on record. The
central bank is implementing measures to force banks to borrow at a higher
rate, according to a person with direct knowledge of the matter. The offshore
yuan extended gains for a third day. China has asked some banks to stop
processing cross-border yuan payments until they balance inflows and outflows,
people familiar with the matter said, as authorities step up a campaign to curb
a record amount of money leaving the nation in the local currency. The yen
traded at 114.60, taking the week’s gain to 2.1 percent, the best performance
since the end of July.
Bonds
The benchmark 10-year Treasury yield rose one basis point
to 2.36 percent, after touching the lowest level since Nov. 30 on Thursday. The
yield on Australia’s 10-year government notes added two basis points to 2.68
percent.
Commodities
Oil held near $53 a barrel after its biggest two-day gain
in almost six weeks as Saudi Arabia said it cut output even more than required
by an OPEC deal. Gold added 0.1 percent to $1,196.7 an ounce after briefly
rising above $1,200 for the first time since November on Thursday.