Investing.com - Financial Markets Worldwide

Dollar Mildly Lower Ahead Of Year End, Dow Hit Record High

ByActionForex
Published 12/31/2013, 01:13 AM
Updated 03/09/2019, 08:30 AM
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Markets remain rather quiet just ahead of new year holiday. The Dow edged up by another 25.88 pts overnight to close at another record high at 16504.29. But the S&P 500 was down slightly by -0.33 pts. Asian equities are generally higher at the time of writing while Japan is on holiday. 10 year yield dripped mildly to close at 2.976%, failing to sustain above 3% mark. In the currency markets, dollar remains soft this week, lost some ground against other major currencies. But the greenback is generally staying above near term support levels. The Yen pared back some losses and is mildly higher after being pressured for most of the year.

In US, Dallas Fed's Fisher expressed concern that excess reserves in the banking system is potential "tinder" for inflation. And, Fed's tapering relied on an untested "theoretical exit". That is, as Fisher described, Fed could have pained itself "into a corner that's going to be very hard to get out of". Fisher will rotates back into voting in FOMC in 2014 and he expected his "voting behavior" to reflect this concern.

In Eurozone, ECB's regular loan facility hit 1.5 yield high yesterday. Commercial banks borrowed EUR 169b in the latest period through ECB's main refinancing operation. Some analysts pointed out that market stresses could be back in the Eurozone zone. But it should also be noted that liquidity is usually tight near year end. Though, if the liquidity condition continues into January, that might raise some concerns.

On the data front, US will release S&P Case-Shiller house price, Chicago PMI and conference board consumer confidence today.

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