Global Markets Overview – December 22, 2014

U.S. one-hundred dollar bills are seen in this photo illustration at a bank in Seoul August 2, 2013. Picture taken August 2, 2013. Reuters

Greenback rallies against majors

Markets ended last week on a positive note with the post-FOMC meeting bid tone continuing to resonate through the globe. The rebound in oil prices also helped underpin sentiment to an extent. While equities drifted higher, there were some notable moves in the fx space with the greenback gaining significant ground against the euro and yen. EUR/USD plunged to $1.222, breaking below its early December lows and now trading at its lowest sinceJuly 2012. The main event for Europe this week will be Greece's second attempt to elect a president, failure to do so could see pressure mount on the single currency.

Big week for Japan

Meanwhile USD/JPY extended its gains in the aftermath of the Bank of Japan meeting and now seems to be heading back to the ¥120.00 mark. Remember we hit ¥121.85 on December 7 and that's the level to look out for. Heading into the minutes from Friday's BoJ meeting and Kuroda's speech which both hit the wires middle of this week, yen weakness is likely to persist. While the BoJ didn't ease further on Friday, Japan releases revised inflation forecasts in January and also announces the new cabinet. From an inflation side of things, weaker oil prices are expected to force some lukewarm projections. The new cabinet is likely to be very strategic incorporating Abe's economic agenda. We'll get a better indication of Japan's inflation when the country releases CPI readings on Friday. As a result, there is plenty out there to keep the yen offered and Japanese equities bid. It looks like the Nikkei will lead the way for Asia today as it is currently pointing up 0.6%.

ASX 200 to extend gains

China will also remain in focus after a recent spike in interbank rates caused some concern and put pressure on equities. The country is pushing on with its reforms and announced it will ease rules on branch openings and yuan transactions by foreign banks. Today China will release November commodity and energy trade data. This will be interesting given the recent moves in energy prices.

The ASX 200 is likely to extend its gains today and we are currently calling it up 0.7% at 5363. The rebound in oil and iron ore will be key for the local market as investors look for some 'bargains' in the resource space. It's also an interesting time for gold as Russia bolsters reserves to fight the slide in the ruble. Apart from that, it's very quiet on the company news front. Another positive is the fact AUD/USD looks like its gearing up for a leg lower. The $0.8100 mark is likely to come under threat with the pair currently in a firm downtrend.

Asian markets opening call	Price at 8:00am AEDT	Change from the Offical market close	Percentage Change
Australia 200 cash (ASX 200)	5,362.90	24	0.45%
Japan 225 (Nikkei)	17,705.50	85	0.48%
Hong Kong HS 50 cash (Hang Seng)	23,137.90	21	0.09%
China H-shares cash	11,463.30	63	0.55%
Singapore Blue Chip cash (MSCI Singapore)	371.63	1	0.23%
US and Europe Market Calls	Price at 8:00am AEDT	Change Since Australian Market Close	Percentage Change
WALL STREET (cash) (Dow)	17,775.50	-17	-0.10%
US 500 (cash) (S&P)	2,065.47	-1	-0.05%
UK FTSE (cash)	6,566.20	20	0.31%
German DAX (cash)	9,776.40	-96	-0.97%
Futures Markets	Price at 8:00am AEDT	Change Since Australian Market Close	Percentage Change
Dow Jones Futures (December)	17,776.00	-19.50	-0.11%
S&P Futures (December)	2,063.00	-3.25	-0.16%
ASX SPI Futures (December)	5,320.00	5.00	0.09%
NKY 225 Futures (December)	17,793.00	100.00	0.57%
Key inputs for the upcoming Australian trading session (Change are from 16:00 AEDT)	Price at 8:00am AEDT	Change Since Australian Market Close	Percentage Change
AUD/USD	$0.8146	-0.0031	-0.36%
USD/JPY	¥119.650	0.365	0.31%
Rio Tinto Plc (London)	£28.52	0.39	1.39%
BHP Billiton Plc (London)	£13.77	0.47	3.53%
BHP Billiton Ltd. ADR (US) (AUD)	$29.70	0.72	2.50%
Gold (spot)	$1,195.69	-0.66	-0.06%
Brent Crude (January)	$62.01	2.37	3.97%
Iron Ore (62%Fe Qingdao)	$69.17	0.75	1.10%