US markets are closed on Monday for Martin Luther King Jr. Day
US stock markets finished mixed on Friday, with equities notching a second straight negative week to start the year. The Dow Jones fell over 0.5%, driven down by major bank stocks, pressured by mixed earnings reports. As such, JPMorgan said its profit and revenue topped estimates, but that was due to a large credit reserve release. Furthermore, the SEO warned that the bank would likely miss a key profit target in the next two years. JPMorgan stocks fell more than 6% following the report. On the data front, retail sales were down 1.9% in December, a worse reading than the 0.1% drop expected. The S&P 500 and the Nasdaq climbed 0.08% and 0.59%, respectively.
Asian markets were mixed on Monday as investors digested the latest economic data from China. The Shanghai Composite was 0.58% higher after the data showed that the country’s GDP grew 4% year-on-year and 1.6% quarter-on-quarter in the fourth quarter while retail sales grew 1.7% year-on-year in December, coming in below expectations. Elsewhere, Hong Kong’s Hang Seng fell 0.68%, while the Nikkei 225 gained 0.74% ahead of the Bank of Japan policy decision due on Tuesday.
In Europe, stocks opened higher as risk sentiment has improved somewhat, with the pan-European Stoxx 600 adding 0.3% in early deals. In individual stocks, Credit Suisse stocks fell 1.7% after the bank’s chairman resigned after breaking coronavirus quarantine rules. US markets are closed on Monday for Martin Luther King Jr. Day.
In currencies, the USD index is back under pressure following the local recovery seen late last week. The index is barely holding above the 95.00 figure during the European hours, off two-month lows seen last week around 94.60 despite hawkish hints from the Fed and strong inflation data. Against this backdrop, EURUSD has settled above the 1.1400 figure while struggling to overcome the 1.1435 immediate barrier. On the downside, the bearish potential is limited as long as the prices stay above the ascending 20-DMA, currently at 1.1345.
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