• Australian employment report turns out better than expected
  • AUDUSD could be close to a turning point given a technical analysis
  • Wall Street advances substantially as tech gains help SP500 (US500 on xStation5) drive at a record high

Looking around major FX pairs one may conclude that it was quite a calm session in Asia. The New Zealand is decisively the strongest currency gaining against the greenback a notch more than 0.2% even as there were no specific reasons standing behind such a move. In turn, the major attention was paid to the Australian economy due to the jobs report. Nevertheless, irrespective of the upbeat data the AUD little changed making just an initial pop and fading it thereafter.

link do file download linkThe Australian labour market keeps its outstanding momentum. Source: Macrobond, XTB Research

According to the official data employment in December grew by 34.7k beating the consensus placed at 15k. On top of that, the prior reading was revised up from 61.6k to 63.6k solidifying the underlying trend. However the breakdown of a change was not so supportive but it was far from disappointments. Full-time employment added 15.1k while part-time increased 19.5k – both figures for November were revised to the upside though. Finally let’s look at the jobless rate which unexpectedly rose from 5.4% to 5.5%, although it was more than offset by a pick-up in the labour force participation rate climbing from 65.5% to 65.7%. Overall, the labour market backdrop remains solid but we could be still quite a long way off from the point the jobs market is tight enough to spur higher wage growth and therefore reinvigorate inflation. Do notice that the unemployment rate remains still relatively high given the historical levels suggesting some slack being still there.

link do file download linkThe AUDUSD could be heading to a strong resistance which might be a tipping point once USD bulls come back. If the ongoing upward move reverses the first target for bears can be found at 0.7880. Source: xStation5

As far as the US stock markets are concerned one may notice a fresh high on the SP500 while the Dow Jones (US30) came back above 26,000 points. At first let’s summarize that the SP500 picked up 0.94%m, the Dow Jones gained as much as 1.25% whereas the NASDAQ (US100) added a touch more than 1%. The benchmarks were propped up by gains for technology and healthcare stocks. Among the best performers one may single out Boeing jumping 4.7% after the company announced a joint venture with car seating leader Adient aimed at making aircraft seats. Otherwise IBM climbed almost 3% after Barclays’ analysts lifted their recommendation to overweight and hiked their price target by $59 to $192. Notice that there are expectations that the outlook for the future earnings should remain rosy due to the lower corporate tax rates passed in December.

link do file download linkThe SP500 ended a short-lived correction and gained back above 2800 points. Once a resistance nearby 2808 points is beaten, it could pave the wave for fresh gains. Nonetheless one cannot forget that the earnings season might play the major role in the nearest future. Source: xStation5