Investing.com - Here are the top five things you need to know in financial markets on Friday, December 22:
1. Bitcoin crashes 30% in worst week since 2013
Bitcoin was last seen below the $14,000 mark on Friday, falling more than 30% this week -its worst weekly decline since April 2013- as it continued to plunge for a sixth consecutive session.
The largest digital coin by market cap –which trades 24 hours a day, 7 days a week- hit a record high of $19,891.00 only last Sunday in the run up to CME’s launch of Bitcoin Futures.
Bitcoin officially entered a bear market, technically defined as a 20% plunge, on Thursday, with most market experts commenting that the alternative currency was long overdue for a correction.
At the time of this writing, even with Friday’s continued slump, Bitcoin has still rallied around 1,300% from just under $1,000 at the beginning of the year and maintains gains of nearly 40% in December.
Bitcoin, known for extreme volatility, has traded in a range of $12,110.00 to $16,775.00 on Friday on the Bitfinex exchange. It was last trading down $2,527.00 or 15.38%, to $13.900 by 5:26AM ET (10:26GMT).
2. Catalan election results weigh on euro
The euro was under pressure on Friday as separatists in Spain’s Catalan region looked set to form a coalition government, rattling markets as Spanish Prime Minister Mariano Rajoy’s plan to reign in the independent sentiment in the area led by Barcelona failed.
Even though the center-right party Ciudadanos (Citizens) won the largest portion of the votes, with 37 seats, the three separatist parties won 70 of the 135 seats in Catalonia’s parliament.
The results are a smack in the face for Rajoy who dissolved the prior Barcelona parliament two months ago after an independence referendum was determined to be illegal by Spain’s Constitutional Court.
Rajoy’s own Partido Popular (People’s Party) came away with its worst election results ever that were called with the hopes to quash the independence movement and restore a unified Spain.
At 5:27AM ET (10:27GMT), EUR/USD fell 0.20% to 1.1850.
3. Focus on U.S. data dump
In the last session before Christmas, markets will focus on data released stateside on Friday.
Top tier data including durable goods, personal income & spending and core PCE price index for November will all be published at 8:30AM ET (13:30GMT).
At 10:00AM ET (15:00GMT), investors will digest the revision to the University of Michigan’s consumer sentiment for December along with November new home sales.
While waiting for the data, the dollar registered modest gains. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.11% at 92.94 by 5:28AM ET (10:28GMT).
4. Global stocks trade mixed as volume continues to thin
Trading was expected be thin on Friday as many market participants had already closed their books for the Christmas holidays. According to Reuters, volume on U.S. exchanges was 6.08 billion shares on Thursday, compared to the 6.88 billion average for the full session over the last 20 trading days.
European equities were mostly lower on Thursday as investors digested the results from the Catalan elections with Spain’s benchmark Ibex 35 leading the declines with losses of around 1% at 5:28AM ET (10:28GMT). The benchmark Euro Stoxx 50 fell 0.28%, while Germany’s slipped 0.09%. Over the UK, London’s FTSE 100 hovered in the black with slight gains of 0.10%. Of note, British traders will be heading home early on Friday as the London Stock Exchange closes at 12:30PM local time (7:30AM ET).
Wall Street was unaffected by the goings on in Europe with U.S. futures pointing to a slightly higher open ahead of the deluge of data. At 5:29AM ET (10:29GMT), the blue-chip Dow futures rose by 25 points, or 0.10%, S&P 500 futures gained 3 points, or 0.09%, while the Nasdaq 100 futures inched up 6 points, or 0.09%.
Earlier on Friday, Asian shares saw muted trade with China's Shanghai Composite closing with weak losses of 0.09%, while Japan's NIkkei 225 ended up just 0.09%.
5. Oil falls ahead of U.S. shale production data
Oil slipped on Friday from some of their highest levels since mid-2015, weighed down by rising U.S. output and the expected January re-opening of the Forties pipeline in the North Sea.
The pipeline which delivers crude underpinning Brent futures, was shut earlier this month due to a crack. Operator Ineos said on Thursday it expected to complete repairs around Christmas and to gradually restart the system in early January.
Meanwhile, U.S. crude production is estimated to be fast approaching 10 million barrels per day would, potentially undermining OPEC's effort to tighten the market and prop up prices.
Later on Friday, market participants will keep an eye on U.S. shale production when Baker Hughes releases its most recent weekly rig count data.
Even though last week’s data showed oil drilling rigs fell by four to 747 in its first drop in six weeks, this early indicator of future output is still much higher than a year ago when only 510 rigs were active.
Ahead of the release, U.S. crude oil futures fell 0.43% to $58.11 at 5:29AM ET (10:29GMT), while Brent oil traded down 0.20% to $64.77.