Foreign Exchange Sky Eye APP News: Yesterday was the closing day of 2019, and European and American stock markets had mixed gains and losses; throughout the year, the Nasdaq and S&P achieved their best annual performance in the past six years, with , apple, and rising by nearly 90%; U.S. oil prices fell throughout the year It rose more than 34%; gold prices rose more than 18% throughout the year, the best in the past nine years. On Wednesday, affected by the holiday, the global market will be closed for one day, and market trading is expected to be light.
[ stock market closing]
Australian stocks: Australia's ASX200 index closed down 120.80 points, or 1.78%, on January 1 (Wednesday), at 6684.10 points.
In addition to the Australian stock market, due to the New Year's Day holiday, Taiwan stocks, Japanese stocks, Korean stocks, A shares, and Hong Kong stocks are closed for one day.
[Financial News]
1. After the holiday shopping spree, US e-commerce will usher in the "largest wave of returns" in history
After the holiday shopping spree, US e-commerce businesses are about to usher in a huge wave of returns.
According to Taiwan's "Business Times" report on December 31, 2019, it is estimated that the scale of goods purchased by American consumers during the holiday season in 2019 will reach a new high, or as high as 100 billion U.S. dollars (1 U.S. dollar is equivalent to 6.98 yuan). In addition, the return amount for online shopping may be nearly three times that of a physical store.
reported that United Parcel Service (UPS) estimates that January 2 will be the peak of returns, and the number of returned packages on that day may break the historical record, possibly reaching 1.9 million pieces, an annual increase of 26%. "Buyers are using their homes as fitting rooms," said Sucharita Kodali, an analyst at
Forrester Research. She predicts that about half of women's clothing will be returned.
Optoro e-commerce expert Larissa Summers said that returned goods will sit in warehouses for weeks, and most retailers lack the ability to handle highly complex reverse logistics challenges.
On the other hand, returned goods need to be handled individually, which increases labor costs. The
report pointed out that Forrester Research estimates that about half of the goods returned from online shopping have almost no residual value. Mantis, the commercial officer of the analysis company 1010 data, mentioned that for these products that are not as good as their original condition, retailers can only sell them at a discount.
Some products may eventually be discarded. Optoro estimates that a large amount of returned merchandise is sent to landfills in the United States every year, equivalent to the cargo of 5,600 Boeing 747 aircraft.
2, QE4 has begun. The Federal Reserve cannot deny it.
In the past two months, some confused investors in the market, or those who have deep faith in the Federal Reserve, have been repeating the remarks of Federal Reserve Chairman Powell: the Federal Reserve recently launched a monthly purchase of US$60 billion. The Treasury Bill plan does not count as QE.
Powell said in a speech at the National Association of Business Economics on October 8: "The expansion of our balance sheet for reserve management should not be confused with the large-scale asset purchase plan we carried out after the financial crisis. Whether it is in the near future Neither the technical issues nor the Treasury purchases we intend to undertake to address them will have a material impact on the stance of monetary policy."
But in reality, from a market perspective, This is indeed quantitative easing. While the Fed claims that its current actions are not quantitative easing, it is purchasing $60 billion in U.S. Treasury bonds every month, reinvesting about $20 billion in Treasury bonds and mortgage-backed securities (MBS), and conducting overnight and term repurchases worth tens of billions of dollars. - As a result, the Fed's balance sheet is expanding at a rapid pace. Data show that the Federal Reserve's balance sheet has grown by more than $400 billion in just four months, and the expansion rate far exceeds the previous three quantitative easings.
3. Will these three major themes create huge waves in the foreign exchange market in 2020?
1. Political uncertainty in Europe gives way to the United States
Political uncertainty in Europe in 2019 has attracted widespread attention. The UK needs to make major decisions by the end of January. Negotiating a separate trade relationship will face many challenges. However, we expect that political uncertainty in Europe will Uncertainty will give way to political uncertainty in the United States. 2020 is an election year, and to some extent, the balance of global growth and economic stability hinges on who wins. Trump Another four years in power could mean more protectionism and slower growth overseas.
2. The economy will not fall into recession, but growth will be slow
In 2019, all major economies avoided recession. Germany nearly fell into recession, but grew just 0.1% in the third quarter. Growth has been very slow in much of the world over the past year, and we expect the same in 2020. The focus on the U.S. presidential election may limit significant policy actions that could be negative for the dollar by making it difficult for companies to plan ahead, but a similar lack of policy action is expected overseas. In Europe, British Prime Minister Johnson will work hard to negotiate individual trade agreements. By 2021 we will know how everything plays out, but between now and then we do not expect a significant acceleration in global economic activity.
3. Stop Easing and Chase Yields
Therefore, the main driver of currency flows will be the chase for yields. Most central banks have signaled they are open to further easing, and we believe most, if not all major central banks have already completed rate cuts. The Reserve Bank of Australia , The Reserve Bank of New Zealand or the Bank of Canada may take action, but it is very unlikely. The end of easing policy will bring about a hunt for yields. Among major economies, the United States and Canada currently have the highest interest rates, followed by New Zealand. Japan, , Switzerland, and the Eurozone are the lowest. Of these central banks, the Fed is the least likely to lower interest rates in 2020. We expect the Fed to be the first to raise interest rates, and if this intention becomes apparent in 2020, it will be a good year for the dollar.
4. Market veteran: Gold will rise sharply in the next decade and bulls will target $5,000 or even $10,000.
Analysts and fund managers said central bankers in various countries may continue to print money, while gold mining will decline after exploration activities decline. decline. As a result, they expect gold prices to rise significantly over the next decade.
Kitco News spoke to three market veterans about gold’s long-term prospects: Frank Holmes, CEO and chief investment officer of U.S. Global Investors, Rohit Savant, director of research at CPM Group, and independent analyst, Morgan Report’s Publisher David Morgan. All three experts expect gold to reach new all-time highs, with two believing gold prices will reach the $5,000/ounce mark within the next decade.
5, CICC network 0101 Digital Currency Daily Commentary: Bitcoin starts a battle to defend US$7,200
Affected by the holiday, the overall transaction volume of mainstream digital currencies today was light. As of the time of writing on CICC website, Bitcoin is barely holding the $7,200 mark and is currently trading at $7,201.12, up 0.16%. In terms of other mainstream digital currencies, Ethereum was reported at $130.30, up 0.91%, Ripple was reported at 0.1927 yuan, up 0.04, and Litecoin was reported at 42.25, up 0.13%.
[Foreign Exchange Market]
In terms of the U.S. dollar, In the U.S. market on Tuesday (December 31), the U.S. dollar index continued its decline. The cumulative decline in three days was far more than 100 points, and it fell to an intraday low of 96.35, refreshing the record since July 1. lowest level. Mitsubishi UFJ Financial Group (MUFG) analysts believe that the technical outlook for the U.S. dollar is bearish, suggesting an increased risk of further weakness in the future. The U.S. dollar weakened toward the end of the year. At the same time, the Federal Reserve's balance sheet expanded again, and the pessimism about the global economic growth outlook has eased.
[Commodity Market]
In terms of gold , has risen since mid-November. The price of gold has broken through the 23.6% retracement level from the May low to the September high of $1,485.26, which was on December 24. was breached. Since then, gold prices have soared, reaching levels not seen since late September. Bulls are currently battling a resistance band above the market, which is guarding peak levels. Given that gold prices currently look severely overbought, it's hard to believe there will be any sustained upside in the short term. Even so, the lack of significant profit-taking in the crude oil market suggests that investors have not given up hope of further gains once 2020 trading begins. In terms of
crude oil, short-term Brent crude oil once fell to a low of 65.45, the lowest level since December 26. As the price fell, the important support level of 66.40 has been lost.The short-term and medium-term exponential moving averages are forming a bearish crossover. The price also fell below the right shoulder of the head and shoulders pattern. Prices are likely to continue falling during the first few days of the new year.
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