Europe starts the new year on a positive note, opening up the economy in China

Yesterday, the Americans rested, so there was no session on Wall Street. In Europe, stocks rose. German Dax and French CAC40 gained 1,05% respectively. by 1,81 percent what can be considered a successful start to the new year. In the FX market, the major currency pair is still between 1,07 and 1,0650. In turn, when it comes to commodities, platinum deserves a special mention, which has grown to the level of $ 1100 per troy ounce and is the most expensive since March this year.

Data from the British economy

At Monday's session, Europe presented the final PMI results for manufacturing, which showed that the sector is still on the defensive, although some readings were better than expected. Indicators for France and Spain fared slightly better than the consensus. In Germany, we saw a higher result than the previous one, however, economists surveyed by Bloomberg expected a slightly better result. We're getting a similar one today information from the British economy. Additionally, the publication of flash inflation for December in Germany deserves attention. CPI is expected to drop to 9,1 percent. and the HICP to 10,7 percent.

Tomorrow, in turn, PMI for the Old Continent will also be presented - this time they will concern the services sector. The market, however can kick-start ISM for US industry. The employment sub-index will be closely monitored. Thursday is the day with the ADP report and the weekly number of new claims for US jobless claims. This will be a kind of introduction to Friday's report from the US labor market, where results showing a slight cooling are expected. This will be followed by the publication of the ISM report for services in the United States.

On Friday, the euro zone will also present its inflation measure. The harmonized index for December is to show a lower dynamics of price growth than that which took place in November.

Testing is no longer required

The economy is opening up in China. The government has practically relaxed all restrictions related to Covid-19 already in December and it seems unlikely that the authorities will re-impose controls despite the spike in infections. At this point, however, the actual number of cases is unknown. The government has stopped reporting daily case numbers as testing is no longer required.

Just two weeks ago, the health service reported that there were about 2 million new cases of infection. A resurgence of new infections is expected after the Chinese New Year holiday, which begins on January 37. On Saturday, we learned the official PMI for Chinese manufacturing, which fell to 22 points. in December and for the non-manufacturing sector it fell to 47 points. This reflects weak domestic demand and disruptions in the supply chain.

The situation looks interesting platinum chart. Yesterday, the raw material reached a level not recorded since the beginning of March this year. It costs $1100 per ounce. Thus, the quotations left the two-year downward channel, which can be considered a technical "buy" signal. The holiday "double low" rightly heralded a price recovery. In the shorter time horizon, the quotations left the flag formation, which also heralds the continuation of the move to the north. The closest technical resistance seems to be the peak set just after the outbreak of war in Ukraine.

Source: Lukasz Zembik, OANDA TMS Brokers