Daily Market Outlook – Friday, Dec. 6

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 Risk in Asia declined on Friday amid renewed political tensions in South Korea, causing unease among investors ahead of the crucial U.S. nonfarm payrolls report, which could affect expectations for a Federal Reserve rate cut this month.The potential for another martial law declaration in South Korea triggered substantial selling pressure on the Korean won and the Seoul stock market. The won fell by as much as 1%, while the KOSPI index experienced a decrease of 1.8% at one point. Additionally, the Australian dollar, often viewed as a barometer of risk appetite, dropped by 0.5%. In response to the situation, South Korean officials acted quickly, with dealers suggesting that the foreign exchange regulator likely intervened by selling U.S. dollars to support the won. Authorities have committed to providing unlimited liquidity to stabilise the markets, a strategy that has proven effective so far. The commander of the country’s special warfare unit alleviated concerns by announcing he would not accept any new orders for martial law. The outperformance in Asia came from Chinese stocks which experienced an uptick as traders heightened their expectations for increased growth stimulus, creating a positive development in a region largely characterised by caution in anticipation of important US employment figures. The CSI 300 index, which serves as China’s benchmark, rose by as much as 1.9%, suggesting that investors are preparing for additional economic stimulus measures from a significant policy meeting scheduled for Wednesday. Equities in Hong Kong also saw a notable increase.While monitoring developments in South Korea, the primary focus for the market is the upcoming U.S. payrolls data, expected to be released later on Friday (For an overview of JPMorgan’s NFP Scenario Analysis click here). Forecasts suggest a 200,000 job increase in November, following a dip in October due to hurricanes and strikes. The unemployment rate is anticipated to rise slightly to 4.2% from 4.1%. Markets are hoping for a balanced outcome: not too strong to undermine the likelihood of a rate cut, nor too weak to spark concerns about economic health. Futures currently imply a 70% chance of a rate cut by the Fed on December 18, suggesting that a strong jobs report could provoke a significant market reaction, especially as recent softer data has led futures to incorporate another quarter-point cut for 2025. Dollar bulls are also wary of a considerable drop in job numbers, which could improve rate cut prospects and surprise a market heavily invested in the U.S. currency. The recent surge in Bitcoin appears to be slowing after it crossed the 100K level for the first time. The cryptocurrency dropped to as low as 91.463K before stabilising at 98k early on Friday, supported by former PayPal executive David Sacks being appointed as Trump’s White House “artificial intelligence and crypto czar.”
 Overnight Newswire Updates of Note

          (Sourced from reliable financial news outlets)
 FX Options Expiries For 10am New York Cut (1BLN+ represents larger expiries, more magnetic when trading within daily ATR)

CFTC Data As Of 29/11/24

Technical & Trade ViewsSP500 Bullish Above Bearish Below 6000

EURUSD Bullish Above Bearish Below 1.0450

GBPUSD Bullish Above Bearish Below 1.26

USDJPY Bullish Above Bearish Below 154

XAUUSD Bullish Above Bearish Below 2600

BTCUSD Bullish Above Bearish Below 92000

Primary objective is 100,000 TARGET HIT NEW PATTERN EMERGING More By This Author:FTSE Fighting The Flatline As French Crisis Remains Front And Centre
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