Market Themes of the Day: Time to Book Profits for 2018 and Enjoy A Happy New Year

What you need to know before markets open
Main themes:

• The news of the UK parliament members claiming a ”meaningful vote” to be able to veto post-Brexit trade deals boosted Sterling to the upper boundary of the sideways range of 1.2600-1.2700.
• Italian parliament approved a revised budget for 2019 lowering planned budget deficit from 2.4% of GDP to 2.04%, reducing the budget deficit less than expected by the European.
• The European Union is not trying to keep Britain in and wants to start discussing future ties the moment the UK parliament approves Brexit, partly to focus on its own unity ahead of May elections. “It is being insinuated that our aim is to keep the United Kingdom in the EU by all possible means. That is not our intention. All we want is clarity about our future relations. And we respect the result of the referendum,” Jean-Claude Juncker, the head of the European Commission, told German newspaper Welt am Sonntag.
• No major economic data are scheduled for the last day of 2018 so I hope you had a good time trading with us, booked fat profits in 2018 and will make some more in 2019. Enjoy your New Year’s Eve celebration and happy New Year!!!

China

• China’s manufacturing PMI decelerated to 49.4 in December falling into the contraction territory and the lowest reading since March 2016.
• China’s non-manufacturing PMI accelerated to 53.8 in December, up from 53.4 in the previous month.

Europe

• German import prices fell -1.0% m/m in November decelerating to 3.1% y/y.
• German inflation decelerated more than expected in December while rising 1.7% y/y, down from 2.3% y/y in the previous month.

UK

• Sky News reported that the UK parliament members want a ”meaningful vote” to be able to veto post-Brexit trade deals. Sterling was boosted to the upper boundary of the sideways range of 1.2600-1.2700.

US

• The release of the US trade balance data was canceled due to US government shutdown on Friday.
• Chicago PMI decelerated less than expected to 65.4 in December, down from 66.4 in the previous month.