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SINGAPORE INDUSTRIAL OUTPUT CONTRACTS FURTHER



Singapore's industrial production declined for the second straight month in November, and at a faster-than-expected pace, data from the Economic Development Board revealed on Friday.

Industrial production dropped 3.2 percent year-on-year in November, faster than the 0.9 percent fall in October. Economists had expected a fall of 1.1 percent.

Excluding biomedical manufacturing, industrial production decreased 4.8 percent annually in November, reversing a 2.2 percent gain in the previous month.

On a monthly basis, industrial production decreased 1.2 percent in November, reversing a 0.6 percent increase in the prior month.

Among major clusters, electronics output plunged 12.4 percent in November, and the chemical cluster logged a decline in output of 11.3 percent.

Meanwhile, transport engineering output advanced 18.8 percent yearly in November, and that of general manufacturing also showed a double-digit growth of 10.3 percent.

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US stocks closed higher, Dow Jones up 0.53%



At the close of the New York Stock Exchange, the Dow Jones rose 0.53%, the S&P 500 rose 0.59%, and the NASDAQ Composite rose 0.21%.

Chevron Corp was the top performer among the components of the Dow Jones index today, up 5.32 points or 3.09% to close at 177.40. The Walt Disney Company rose 1.34 points or 1.55% to close at 88.01. The Travelers Companies Inc rose 2.28 points or 1.22% to close at 189.48.

The least gainers were 3M Company, which shed 1.45 points or 1.19% to end the session at 120.14. Amgen Inc was up 1.34 points (0.51%) to close at 263.92, while Apple Inc was down 0.37 points (0.28%) to close at 131.86. .

The leading gainers among the S&P 500 index components in today's trading were APA Corporation, which rose 5.73% to 47.25, CarMax Inc, which gained 5.17% to close at 60.16, and Hess Corporation, which rose 4.72% to end the session at 141.68.

The least gainers were Moderna Inc, which shed 4.44% to close at 199.08. Shares of Illumina Inc lost 2.32% to end the session at 191.24. Quotes of DexCom Inc decreased in price by 1.97% to 111.44.

Leading gainers among the components of the NASDAQ Composite in today's trading were Expion360 Inc, which rose 139.19% to hit 2.35, Akso Health Group DRC, which gained 1.57% to close at 0.40, and also shares of Elys Game Technology Corp, which rose 47.09% to end the session at 0.17.

The least gainers were Applied Molecular Transport Inc, which shed 57.77% to close at 0.44. E-Home Household Service Holdings Ltd lost 52.59% to end the session at 0.64. Quotes Mingzhu Logistics Holdings Ltd fell in price by 50.84% to 1.75.

On the New York Stock Exchange, the number of securities that rose in price (2099) exceeded the number of those that closed in the red (959), while quotes of 96 shares remained virtually unchanged. On the NASDAQ stock exchange, 1909 companies rose in price, 1754 fell, and 216 remained at the level of the previous close.

The CBOE Volatility Index, which is based on S&P 500 options trading, fell 5.01% to 20.87.

Gold futures for February delivery added 0.57%, or 10.20, to $1.00 a troy ounce. In other commodities, WTI crude for February delivery rose 2.80%, or 2.17, to $79.66 a barrel. Futures for Brent crude for February delivery rose 4.40%, or 3.56, to $84.54 a barrel.

Meanwhile, in the forex market, the EUR/USD pair remained unchanged 0.23% to 1.06, while USD/JPY was up 0.38% to hit 132.84.

Futures on the USD index fell 0.12% to 104.01.

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US stock market closed mixed, Dow Jones up 0.11%



At the close on the New York Stock Exchange, the Dow Jones rose 0.11%, the S&P 500 index fell 0.41% and the NASDAQ Composite fell 1.38%.

The gainers among Dow Jones index components in today's trading were shares of Verizon Communications Inc. which gained 0.84p (2.19%) to close at 39.25. Caterpillar Inc. gained 3.27p (1.36%) to close at 243.14. Chevron Corp. gained 2.23 pct (1.26%) to close at 179.63.

Shares of the Walt Disney Company were the least gainers, with their price dropping 1.64p (1.86%), ending the session at 86.37. Shares of Apple Inc soared 1.83p (1.39%) to close at 130.03, Goldman Sachs Group Inc dropped 3.54p (1.02%) and closed the session at 341.97.

The top gainers among the S&P 500 index components in today's trading were shares of Wynn Resorts Limited, which gained 4.47% to 84.33, VF Corporation, which gained 4.18% to close at 27.16, and Las Vegas Sands Corp, which gained 4.17% to close the session at 48.46.

Shares of Tesla Inc were the least gainers, down 11.41% to close at 109.10. Moderna Inc shares lost 9.50% and closed the session at 180.17. NVIDIA Corporation shares were down 7.14% to 141.21.

The top gainers among NASDAQ Composite index components in today's trading were shares of Elys Game Technology Corp, which gained 111.91% to 0.37, Lightjump Acquisition Corp, which gained 100.00% to close at 19.00, and shares of Quotient Ltd, which gained 94.74% to close the session at 0.37.

The least gainers were shares of Tuesday Morning Corp, which fell 46.12% to close at 0.83. Shares of Mingzhu Logistics Holdings Ltd lost 44.57% and closed the session at 0.97. Lion Group Holding Ltd. was down 36.45 percent to 0.68.

On NYSE the number of securities, which fell in price (1697) exceeded the number of securities, which closed on the plus side (1401). On NASDAQ, 2,517 stocks were down, 1,251 were up, and 139 remained flat.

The CBOE Volatility Index, which is based on S&P 500 options trading, rose 3.74% to 21.65.

Gold futures for February delivery added 0.98%, or 17.65, to $1.00 a troy ounce. In other commodities, WTI crude for February delivery rose 0.16%, or 0.13, to $79.69 a barrel. Futures for Brent crude for March delivery rose 0.43%, or 0.36, to $84.86 a barrel.

Meanwhile, in the Forex market, the EUR/USD pair was unchanged 0.05% to 1.06, while USD/JPY was up 0.49% to hit 133.51.

Futures on the USD index fell 0.12% to 103.89.

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SOUTH KOREA INDUSTRIAL PRODUCTION CLIMBS 0.4% IN NOVEMBER



Industrial output in South Korea rose a seasonally adjusted 0.4 percent on month in November, Statistics Korea said on Thursday.

That beat forecasts for a decline of 0.8 percent following the 3.5 percent contraction in October.

On a yearly basis, industrial output sank 3.7 percent - also topping expectations for a drop of 4.0 percent following the downwardly revised 1.2 percent contraction in the previous month (originally -1.1 percent).

The index of all industry production was up 0.1 percent on month and 0.6 percent on year in November.

The Manufacturing Production Index added 0.5 percent on month but fell 3.8 percent on year. The Manufacturing Shipment Index lost 2.4 percent on month and 4.2 percent on year. The Manufacturing Inventory Index increased by 1.4 percent on month and 6.1 percent on year.

The Production Capacity Index was flat on month and down 0.8 percent on year. The Index of Capacity Utilization Rate rose 0.9 percent on month but shed 2.5 percent on year. The Manufacturing Average Capacity Utilization Rate was 73.1 percent, up 0.6 percentage points from the previous month.

The Index of Services fell 0.6 percent on month but climbed 2.6 percent on year. The Retail Sales Index sank 1.8 percent on month and 2.2 percent on year.

The Equipment Investment Index added 1.0 percent on month and 11.0 percent on year. The Domestic Machinery Shipment Index surged an annual 10.9 percent. The value of Domestic Machinery Orders Received soared 15.3 percent on year. The value of Construction Completed at constant prices increased by 1.4 percent on month and 10.2 percent on year.

The value of Construction Orders Received at current prices tumbled 11.1 percent on year.

The Composite Coincident Index eased 0.5 percent on month. The Cyclical Component of Composite Coincident Index, which reflects current economic situations, fell 0.7 points from the previous month.

The Composite Leading Index rose 0.1 percent on month. The Cyclical Component of Composite Leading Index, which predicts the turning point in business cycle, dipped 0.2 points from the previous month.

Also on Thursday, Statistics Korea said that the value of retail sales in South Korea was down a seasonally adjusted 1.8 percent on month in November.

That missed expectations for a decline of 1.0 percent following the 0.2 percent contraction in October.

On a yearly basis, retail sales were down 2.2 percent - again missing forecasts for a decline of 1.5 percent following the 0.7 percent drop in the previous month.

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SOUTH KOREA INFLATION STEADY AT 5.0%



South Korea's consumer price inflation remained unchanged in December, figures from Statistics Korea showed on Friday.

Consumer prices rose 5.0 percent year-on-year in December, same as seen in November. This was in line with economists' expectations.

Excluding food and energy, core consumer prices rose 4.1 percent annually in December, after a 4.3 percent increase in the previous month.

On a monthly basis, consumer prices increased 0.2 percent in December, following a 0.1 percent drop in November.

Compared to the previous month, the core CPI remained unchanged at 0.3 percent in December.

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USD/JPY: the dollar has lost control



At the beginning of the new year, the USD/JPY pair is still in a bearish trend. Every day the quote is going deeper to the south, hitting one after another multi-month lows. However, analysts believe it is still far from the bottom. This morning, the dollar-yen asset showed another resounding drop. The major lost about 160 points in just a couple of hours, bringing it to its lowest level since June at 129.79. The sharp drop to the 6-month low was due to growing expectations regarding the possible pivot of the Bank of Japan.



Another surge of speculation on the subject came after Japan's Nikkei reported Saturday that the BOJ might revise its inflation forecast upward in January.

If the BOJ does indeed raise its consumer price growth forecast for 2023, it would further bolster traders' view that the central bank may soon be on a hawkish track.

Recall that the BOJ is the only major central bank in the world that still maintains an ultra-loose policy and keeps interest rates ultra-low.

In contrast to the BOJ, last year the US Federal Reserve took a sharp course towards tightening. This led to strong monetary divergence between the central banks, which weighed heavily on the JPY.

In October 2022, the JPY fell against the dollar to a 32-year low of 151.95. However, since then the Japanese currency has strengthened against its U.S. counterpart by more than 16%.

In November, USD/JPY was down 8.5% as traders had concerns about the slowdown in interest rate hikes in the US.

Last month, the yen gained more than 5% against the dollar. The main driver of its growth was the BOJ's surprise tweak to its bond yield control.

The BOJ's decision to allow 10-year bond yields to fluctuate by plus or minus 0.5 percentage points of its 0% target level was acknowledged by the market as the central bank's first step towards its monetary-policy normalization.

As we can see, now the fundamental picture, which favored the dollar's growth in 2022, is starting to change gradually in favor of the yen.

The Fed has already slowed the pace of its tightening, when it delivered a smaller rate hike of just 50 bps in December following four straight 75 bps hikes. At this stage, most traders tend to further reduce the degree of aggressiveness.

Meanwhile, the market is expecting hawkish actions from the BOJ. Many investors believe that BOJ will abandon its soft course in the second quarter of the year, after the current head of the central bank Haruhiko Kuroda will leave his post in April.

"I would expect an end to negative rates by April. This further removes obstacles for the yen to strengthen more," said Rajeev De Mello, a global macro portfolio manager at GAMA Asset Management.

According to the expert, at the moment the Japanese currency is significantly undervalued compared to its fair levels, which indicates its high growth potential.

Recall that recently former Japanese Vice-Minister of Finance Eisuke Sakakibara, known as "Mr. Yen", said in an interview last month that the yen may appreciate to 120 per dollar this year.

Generali Investments and Jupiter Investment Management have also flagged the same level as the next potential bearish target.

As for the near-term outlook, this week the quote is likely to keep its downtrend, unless, of course, the dollar bulls get some super-powerful trigger.

One of the catalysts for the pair may be tomorrow's release of the minutes of the Fed's December meeting. Traders hope the FOMC minutes will shed light on the future trajectory of interest rates in the US.

If the market views the Fed's rhetoric as hawkish, it will help the dollar recover its recent losses against the yen. Otherwise, the USD/JPY pair risks to collapse even more.

Also, this week investors will focus on the US jobs report, which will be released on Friday.

Positive data might push up the dollar in all directions, including the USD/JPY pair, whereas negative data will push the greenback even higher, which will raise the demand for the yen.

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OIL FUTURES SETTLE SHARPLY LOWER ON RECESSION FEARS



Oil prices fell on Wednesday, extending recent losses, as worries about energy demand amid rising fears of a global recession continued to weigh on the commodity.

West Texas Intermediate Crude oil futures for February ended down $4.09 or about 5.3% at $72.84 a barrel, the lowest settlement in more than three weeks.

Brent crude futures were down $4.10 or almost 5% at $78.00 a barrel a little while ago.

China's decision to increase export of refined oil products has fueled concerns of weaker demand in the country.

Meanwhile, Japan has announced that it would tighten borders controls for travelers from China, in response to a surge in Covid cases among visitors.

Traders also took note of comments from former New York Federal Reserve President William Dudley, who said a recession in the U.S. is likely because of what the Fed has to do.

Traders are looking ahead to weekly inventory reports from the American Petroleum Institute (API) and U.S. Energy Information Administration (EIA). The API's report is due later today, while EIA's inventory data will be out Thursday morning.

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CHINA SERVICES ACTIVITY LOGS FOURTH CONSECUTIVE CONTRACTION



China's service sector shrank for the fourth consecutive month in December as the ongoing measures to contain the Covid-19 disrupted operations and hampered demand.

At 48.0, the Caixin services Purchasing Managers' Index rose from a six-month low of 46.7 in November, survey results from S&P Global showed Thursday. But a reading below 50.0 suggests the sector remains in the contraction zone.

The Covid-19 containment measures, including temporary business closures dampened production.

Further, due to pandemic related restrictions, outstanding business increased for the fifth consecutive month as firms were unable to work through backlogs of work.

Cost reduction policies together with voluntary leavers drove another fall in service sector employment. The pace of job shedding was quicker than seen on average in 2022.

On the price front, the survey showed that input cost inflation slowed to a six-month low. Consequently, firms raised their own charges at the softest pace since August. Another reason for the easing in output price inflation was stiff competition.

Optimism among service providers was the strongest since July 2021. Companies that foresee higher output expect the pandemic situation to improve, restrictions to ease, and operations and demand to recover.

The overall private sector that combines manufacturing and services shrank for the fourth straight month in December. But the rate of contraction eased with softer falls in output across manufacturing and services.

The composite output index picked up to 48.3 in December from 47.0 in November.

Infections are expected to explode in the short run, which will disrupt production and everyday life, Wang Zhe, a senior economist at Caixin Insight Group said. "How to effectively coordinate Covid controls with economic and social development has once again become a crucial question."

In order to prop up domestic consumption, various policies are needed that work in tandem with stabilizing the job market and effectively increasing the disposable incomes of residents, said Zhe.

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EUROPEAN ECONOMIC NEWS PREVIEW: GERMANY FACTORY ORDERS, RETAIL SALES DATA DUE



Factory orders and retail sales from Germany and flash consumer prices, retail sales and economic confidence from the euro area are the top economic news due on Friday, headlining a busy day for the European economic news.

At 2.00 am ET, Destatis is slated to release Germany's manufacturing orders and retail sales figures for November. Economists forecast factory orders to fall 0.5 percent on month, reversing a 0.8 percent rise in October. Similarly, retail sales are seen rising 1.0 percent after falling 2.8 percent a month ago. In the meantime, UK Halifax house price data is due for December. Also, industrial output data is due from Statistics Norway.

At 2.45 am ET, France's Insee publishes consumer spending data for November. Economists forecast consumer spending to grow 1.0 percent month-on-month, in contrast to the 2.8 percent fall in October. At 3.00 am ET, the Czech Statistical Office is set to issue industrial and construction output and foreign trade reports.

At 4.30 am ET, UK S&P/CIPS construction Purchasing Managers' survey results are due. The construction index is expected to fall to 49.6 in December from 50.4 in the prior month.

At 5.00 am ET, Eurozone flash inflation, retail sales and economic confidence are due. Inflation is seen easing to 9.7 percent in December from 10.1 percent in November. Economists expect retail sales to grow 0.5 percent on month, reversing a 1.8 percent fall in October.

The euro area economic confidence index is seen at 94.7 in December versus 93.7 a month ago.

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EUROPEAN ECONOMICS PREVIEW: GERMANY INDUSTRIAL OUTPUT DATA DUE



Industrial production from Germany and unemployment from the euro area are the top economic news due on Monday.

At 1.45 am ET, the State Secretariat for Economic Affairs is scheduled to issue Swiss unemployment data for December. The jobless rate is forecast to rise to 2.1 percent from 2.0 percent in November.

At 2.00 am ET, Destatis is set to publish Germany industrial production for November. Economists forecast industrial output to grow marginally by 0.1 percent from October, when output was down 0.1 percent.

At 2.45 am ET, foreign trade and current account figures are due. The trade deficit is seen narrowing to EUR 11.3 billion in November from EUR 12.2 billion in October.

At 4.00 am ET, Italy's Istat publishes unemployment data for November. Economists expect the jobless rate to remain unchanged at 7.8 percent.

Half an hour later, Eurozone Sentix investor confidence survey results are due. The investor sentiment index is forecast to rise to -18.0 in January from -21.0 in December.

At 5.00 am ET, Eurostat is scheduled to issue euro area unemployment for November. The jobless rate is seen unchanged at 6.5 percent.

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