State of The Markets | Rising Yields Buoyed Dollar


Rising yields buoyed Dollar . Democrat control of the senate was embraced by the markets as investors chasing riskier assets forcing the 10Y yields to rise past 100 basis points. Fixed income investors were seen bidding US treasuries as the equities markets rose higher, forcing sellers to offer higher as the Dollar index closed above the 89.80 level. Equities sectors all finished in green, led by technology, except consumer staples and utilities that took a pullback.

On buoyed sentiments, crude continued its upward trajectory to close above $50.80/bl for the first time in 10 months while the anti-inflationary asset gold edged lower, closing below $1,912.50, as investors gauge the effects of additional stimulus package by Democrat controlled senate.

Heavy bidding in the fixed income markets forced Dollar supports to penetrate the medium term accounts and gained below Kiwi and Euro. Aussie short term accounts were seen in net short as medium term investors retreated on profit taking. Sterling rebound in the short-term might be used by medium term investors to cash in and booked their profits, while some short-term sellers might initiate fresh offers.

OUR PICK – No New Pick

No new pick for first week of the new year due to thin markets. First week of the new year is the usual time to rebalance the portfolio and readjust our trading system and strategies to reflect new market dynamics. We will wait until after the release of US employment figure for December before making any new pick.

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This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.