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Daily Market Insight: 6 December 2022

6 Dec 2022
  •   USDTHB: moving in the range 34.91-35.03 this morning, supportive level at 34.80 resistance level at 35.10

·         SET Index: 1,641.6 (-0.41%), 2 Dec 2022

·         S&P 500 Index: 4,071.7 (-0.012%), 2 Dec 2022

·         Thai 10-year government bond yield (interpolated): 2.61 (-6.35 bps), 2 Dec 2022

·         US 10-year treasury yield: 3.51 (-2.0 bps), 2 Dec 2022

 

  • U.S. job juggernaut rolled on in November; nonfarm payrolls up 263,000
  • Japan's service-sector activity growth hits 3-month low
  • China services activity shrinks further in November
  • Dollar weakens, Yuan soars on Chinese reopening hopes

 

U.S. job juggernaut rolled on in November; nonfarm payrolls up 263,000 The U.S. labor market juggernaut refused to slow down in November, as job creation held up despite increasing signs of layoffs across the economy. Nonfarm employment grew by 263,000 through the middle of the month, well above the 200,000-consensus forecast. October's number was also revised up by 23,000 to show a gain of 284,000. The payrolls gain was only one element of a report that signaled ongoing tightness throughout the labor market. Average hourly earnings rose by 0.6% to push annual earnings growth back up to 5.1%. Here, too, October's data was revised up from an initial estimate of 0.4% to 0.5%. Moreover, the buoyant jobs market again failed to lure sidelined workers back into the labor force. The participation rate fell to 62.1% from 62.2%.

 

Japan's service-sector activity growth hits 3-month low Japan's service sector activity grew in November at the slowest pace in three months, as relentless inflation dampened a part of the economy that was benefiting from the return of domestic and foreign shoppers and easing COVID-19 restrictions. The final au Jibun Bank Japan Services purchasing managers' index (PMI) fell to a seasonally adjusted 50.3 from October's 53.2, hitting the lowest since August.

The index however stayed above the 50-mark that separates expansion from contraction for a third straight month and was slightly better than the flash reading of 50.0 for November.

 

China services activity shrinks further in November China’s services sector contracted sharply in November, a private survey showed on Monday, as rapidly rising COVID-19 cases invited more lockdown measures and further disrupted economic activity.  The Caixin Services purchasing managers index (PMI) read fell to 46.7 in November from 48.4 in the prior month, missing expectations of 48.0. The index marked its third straight month below 50, indicating a pronounced contraction in the sector. The data comes in line with the results of an official survey released last week, which highlights deepening economic cracks in China due to its COVID-related restrictions. Manufacturing activity also shrank substantially over the past three months, with the Caixin composite PMI tumbling to 47 in November, showing an extended decline in business activity.

 

Dollar weakens, Yuan soars on Chinese reopening hopes The 10-year government bond yield (interpolated) on the previous trading day was 2.61, -6.35 bps. The benchmark government bond yield (LB31DA) was 2.50, -5.00 bps. LB31DA could be between 2.40-2.90. Meantime, the latest closed US 10-year bond yields was 3.51, -2.0 bps. USDTHB on the previous trading day closed around 34.77 Moving in a range of 34.91-35.03 this morning. USDTHB could be closed between 34.70-35.10 today. The U.S. dollar weakened in early European trade Monday and the Chinese yuan soared to its highest level since mid-September as relaxation of some of China’s strict COVID-19 curbs boosted risk appetite. The Dollar Index, which tracks the greenback against a basket of six other currencies, fell 0.2% to 104.350, after earlier falling as low as 104.062, its weakest since late June. More Chinese cities, including financial hub Shanghai, announced an easing of mobility restrictions over the weekend, raising hopes that the country's authorities will agree to a general relaxation of its strict ‘zero-COVID’ policy in the near future after violent protests against restrictions.

 

Sources : ttb analytics , Bloomberg, CNBC, Trading economics, Investing, CEIC