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DE30 follows US into record territory; USDJPY retesting 4-month low at 110

Summary:

  • The DE30 has broken higher today to reach a new record peak
  • Strong ZEW sentiment print supports latest rally
  • US end government shutdown; Stocks hit new highs
  • USDJPY falls near September lows after BoJ stand pat
  • Oil price rises ahead of inventories
  • Crypto looks to rise despite South Korean ban on anonymous accounts

Whilst the US500 and UK100 have been surging higher into uncharted territory in the first few weeks of the year, the DE30 had remained below its all-time peak. This all changed this morning however, when a strong open saw the German benchmark smash above its previous to post a new record

Economic data has been strong on the whole for Europe’s largest economy of late and another positive release today indicates further positivity surrounding the German economy. The ZEW sentiment index smashed forecasts and rose strongly, supporting the breakout seen in the stock market.   

There’s been more good news for stock market bulls across the Atlantic with the US500 building on Monday’s record close to post another intra-day high. The end of the US government shutdown is a favourable development for the world’s largest economy but if truth be told it had imparted next to no negative pressure on stocks yesterday.  

The first of two major central bank meetings this week concluded overnight, with the Bank of Japan keeping their monetary policy unchanged. The Yen rose on the announcement with hints of stronger GDP growth and higher inflation ahead supporting the currency. The USDJPY has dropped throughout the day and trades not far above the 110 handle and close to a 4-month low on the European close. 

Oil markets have looked to make a move higher today with both Brent and WTI making steady gains. The API inventory release tonight and, more importantly, tomorrow’s DOE data could well drive these benchmarks in the short-term with their price presently not far from 3-year peaks. 

A technical overview of Oil.WTI can be found here.

News that South Korea has announced a ban on all anonymous cryptocurrency accounts threatened to send the markets plunging early on but after holding their weekly lows there has been something of a recovery this afternoon. All 5 markets are now positive on the day and after threatening to break back below 10,000 earlier on, Bitcoin is now trading back close to the 11,000 mark. 

 

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