Market News & Analysis


Market Brief: GBP hurt by poor services PMI

  • Market update: In FX, GBP and to a lesser degree EUR sold off this morning although both were off their worst lows but still down on the day following the earlier release of poor services PMI data from the UK and Eurozone. Stocks were higher, although mainland European indices came off their best levels while FTSE was up 1% at the time of writing, supported by a weaker sterling. Gold was up as German, UK and US 10-year yields fell, and the yen strengthened. Crude oil was a touch higher after two days of sharp gains. The price of Bitcoin dropped to its lowest level since May, reaching a low so far of $6930.

View our guide on how to interpret the FX Dashboard

  • Christine Lagarde gave her first proper speech as ECB’s president and although she shied away from providing any significant hints about changes in interest rates, she did call for a strategic review of monetary policy in the near future and greater fiscal spending. Read more HERE.
  • Data recap: the latest services PMI data from the UK and Eurozone disappointed expectations, hurting both the pound and the euro:
    • The Eurozone Composite PMI unexpectedly fell to 50.3 in November from 50.6 in October, worse than expected
    • Eurozone Manufacturing PMI remained in the contraction for the 10th consecutive month, coming in at 46.6 vs. 46.4 expected and 45.9 last.
    • Eurozone Services PMI fell to a 10-month low of 51.5 vs. 52.2 last and 52.4 expected
    • On a country level, French manufacturing PMI rebounded to expansion territory at 51.6 vs. 50.7 last, while services PMI was unchanged at 52.9. German manufacturing PMI improved to 43.8 from 42.1, while services PMI slowed to 51.3 from 51.6.
    • UK Flash Services PMI printed 48.6 for November, suggesting the sector contracted. It fell more than one whole point from 50.0 in October and was also worse than 50.1 expected.
    • UK flash Manufacturing PMI eases to 48.3 compared with 48.8 expected and 49.6 last.

  • Coming up:
    • Canadian retail sales: headline expected to print -0.3% m/m vs. -0.1% last; Core expected to come in at -0.1% vs. -0.2% in the previous month
    • US Markit Flash Manufacturing and Services PMIs, expected at 51.5 and 51.2 respectively
    • Revised UoM Consumer Sentiment and Inflation Expectations



Disclaimer

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

GAIN Capital Singapore Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the GAIN Capital group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), GAIN Capital Singapore Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact GAIN Capital Singapore Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither GAIN Capital Singapore Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

GAIN Capital Singapore Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.

Important Notice:

Cryptocurrencies are not legal tender currency and trading of derivatives on Cryptocurrencies are currently not covered under any regulatory regime in Singapore. Consequently, investors should be aware they do not have protection under the Securities and Futures Act (Cap. 289). Please ensure that you are fully aware of the risks.