Daily Market Report - 12/01/2016

Monday was a light day in terms of data for the pound, however the FTSE suffered further losses posting its worst first week of the year since 2000. This was partly due to weak data out of China causing copper prices to fall, having an effect on mining firms listed on the FTSE. This coupled with the falling price of oil makes the chances of the UK raising rates this year less and less likely. However we did see the GBP strength yesterday with it making gains against the USD and the EUR.

Yesterday in the US we had the Labour Market Conditions Index (Dec), which came out at 2.9 which is higher than the previous 2.7. A reading above 0.0 indicates improving labour market activity, below indicates deteriorating activity. So this is positive data for the US, however it is not a huge market mover. T

he S&P 500 fell again on yesterday continuing its bumpy start to the year with the S&P 500 and the Dow posting their worst five-day start to the year in history. However the dollar it did make a recovery towards the end of the day and regained most losses. Crude prices fell 4.3 percent to $31.72 a barrel, while benchmark Brent dropped 5 percent to $31.83 a barrel, which was a 12 year low.

In early Asian trading sessions we saw the ZAR lose a lot of ground against all major currencies. This was attributed to a continued lack of confidence in the ruling ANC, and the fact that this weekends conference did not address these concerns caused unrest amongst Japanese investors. Yield hungry Japanese retail investors decided to cut their ZAR positions which triggered a number of stop losses sending the currency into free fall. The outlook remains continually bearish or the Rand

Key Announcements
09:30 - GBP: Industrial Production YOY Nov. Expected to remain unchanged at 1.7%
09:30 -GBP: Manufacturing Production YOY Nov. Expected down to -0.8% from -0.1%
14:15 - GBP: BoE Governor  Mark Carney speaks