Good morning! Here’s what you need to know in markets on Monday.
The Euro Sinks To A 9-Year Low. The euro hit a nearly nine-year low versus the dollar on Monday as investors bet on quantitative easing by the European Central Bank. The euro fell to as low as $US1.18605, its weakest level since March 2006, having fallen below an important support at $US1.20.
Merkel Is Under Fire For Her Grexit Remarks. German Chancellor Angela Merkel came under fire Sunday over a magazine report suggesting she would be prepared to let Greece exit the euro should a far-left party win a snap Greek election.
Oil Slides to New 6-Year Lows. Oil continues to crash from its summer 2014 highs. The price of brent crude just fell below $US55 a barrel for the first time since May 2009.
Japanese Manufacturing Grew In December. Japanese manufacturing activity showed sustained growth in December, a survey showed Monday, suggesting domestic demand continues to recover after the economy fell into a surprise recession last year. The final Markit/JMMA Japan Manufacturing Purchasing Managers Index (PMI) was 52.
Markets Are In The Red. In Europe, Britain’s FTSE 100 is down 0.7%, France’s CAC 40 is down 0.7%, and Germany’s DAX is down 0.4%. In Asia, Japan’s Nikkei closed down 0.2%, and Hong Kong’s Hang Seng fell 0.5%. US stock market futures are in the red, with Dow futures down 39 points and S&P futures down 5 points.
China Rips Higher. China’s Shanghai Composite surged 3.6% Monday. Surging 58% last year, the Shanghai Composite was the hottest global stock market index of 2014.
December Auto Sales Coming. The big automakers on Monday will announce their December US sales stats. Analysts are predicting an annualized rate of 16.9 million units. From Morgan Stanley’s Ted Wieseman: “Sales jumped 4.5% to 17.1 million units annualized in November, second highest since 2006 after 17.4 in August, helped by successful Black Friday promotions. Black Friday weekend has become a big deal for the industry the past couple years after auto dealers previously hadn’t generally been active participants in the post-Thanksgiving sales frenzy. Last year there was some payback in December from sales pulled into late November, but stepped up discounting and support from plunging gasoline prices appear to kept sales elevated this year.”
Spain’s Governing Party Is Leading Polls Again. Spain’s ruling center-right People’s Party came first in an opinion poll Sunday, one of its strongest results in recent surveys, while the Socialists and left-wing newcomer Podemos were in close second and third place respectively. The Anti-austerity Podemos have been in first place in other recent polls.
Tesco Is About To Announce Job Cuts. The British supermarket chain Tesco will on Thursday announce dramatic changes to supplier contracts and job cuts to help rebuild its reputation after an accounting scandal and four profit warnings last year, the Sunday Times reported.
China Just Got Its First Online Bank. The country’s new online-only bank, WeBank, was launched Sunday by Tencent, with Chinese Premier Li Keqiang helping to unveil the service, according to the Financial Times.