FOREX: December and Q4 In Perspective

By: Mike Campbell

Last month saw all of the major stock markets closing higher compared to the where they stood at the beginning of December. December also marked the end of Q4 2009 and, again, all the markets saw growth during the quarter. In Europe, the FTSE made almost 1.7% in December, closing at 5412.9 and showed a growth of 11.5% over Q4; the CAC made 2.3% over during the month and ended Q4 stronger by 9.4%; the Dax put on 2.4% in the course of the month and ended the quarter up by 10.6% at 5957.43.

In the USA, the Dow ended the month up by a modest 0.4%, but was up by 10.5% over the quarter, finishing the trading session at 10428.1. The technology heavy Nasdaq again outshone its illustrious neighbour by putting on 3.4% last month, closing at 2269.15 and ending Q4 12.4% higher.

The Nikkei continued its recent consolidation, putting on a further 4.9% over the course of December to close at 10546.4 but it only managed growth of 3.5% during the quarter: approximately a third of that seen by the other majors.

On the currency markets last month, the Dollar was mixed. It regained significant strength against the Yen, ending the month 4.6% higher at 92.43 to the Dollar, but it still lost 0.5% over the quarter. Against the Euro it strengthened by 4.5% over the month, closing at 1.4406, however, it lost 1% of its value against the Euro over the course of Q4. The Greenback was stronger against the British Pound gaining 2.65% closing at 1.62212 during December and 0.8% over Q4.

The Euro was effectively unchanged against the Yen last month closing at 133.16, up by 0.06% - over Q4 the Euro appreciated by 0.54%. It lost ground against Sterling, shedding almost 1.9%, however it ended Q4 worth 1.8% more against the Pound. The close saw one £ buying 1.126€.

On the commodities market, the price for Brent crude oil was higher against last month’s mark closing at 77.93$ per barrel (for February delivery), the price of Brent crude rose by 0.5% during the month but ended the quarter up 16.6%. The value of gold has continued to retreat, closing at 1096 $ per ounce and has dropped another 9.2% over the previous month’s close, but the precious metal still appreciated by 10.5% in the final quarter of 2009.