Holiday Conditions Prevail……..

….. and all financial centres seem to have decided enough is enough. We did get some mildly positive numbers from the US yesterday afternoon but the outcomes were close to estimates and therefore created not a ripple. The dip in jobless claims, cementing the recent downtrend is convincing markets that the soft November payrolls release was, as first thought, just an anomaly and not a return to a weakening employment market. A stronger report in December is now on the cards. The consumer confidence index compiled by the University of Michigan rose to 74.5 from the previous 74.2 and the inflation component within was also pushed up a little. Finally, new home sales came in at +5.5% month-on-month which although slightly lower than expected, still suggests a gradual recovery on a continued improvement in the underlying labour market. The Dollar though, failed to benefit and the market slumbered; equities finished a tad lower following the recent strong run. The only asset that stirred looks to have been crude oil which pushed higher again on the continued freezing conditions both in the US and Europe. West Texas Intermediate edged up to $91.5 per barrel, moving inexorably towards the $100 target.

Late yesterday afternoon, Fitch downgraded Portugal’s sovereign rating from AA- to A+ with a negative outlook, citing the evermore difficult financing environment but added that they had not assumed the country having to seek EU-IMF assistance. Depending upon which side of the fence you are sitting, this addendum could be regarded as positive (Fitch do not feel that further financial assistance will be needed) or negative (Fitch will cut the rating further on Portugal being forced to seek help). On a more positive note, Standard & Poor’s affirmed France’s AAA rating….. Neither announcement affected the value of the Euro.

Today, unsurprisingly, there is no data scheduled and no prizes for getting involved so expect current rates to be set in stone for the remaining hours. Interestingly, both Monday and Tuesday are Euro and Dollar trading days so come Wednesday, we might return to differing levels. We will see….

Two major anniversaries to commemorate today….. Back in 1828, the trial of grave-robber and murderer William Burke (half of the infamous Burke & Hare duo) began. What a strange date to begin a trial….. And not quite so long ago, 50-years in fact, Carol Vorderman was born.

It leaves me to wish all our readers a Very Happy Christmas and New Year and we look forward to resuming the commentary in January.