We started the week with a heavy dose of trade pessimism and finished it with a non-farm payroll report that has investors ready to plow back into risk assets. Perhaps more encouraging is the fact that international equities have been outperforming over the past week and a half as the dollar has begun turning negative relative to other worldwide currencies.
I've argued that international stocks, emerging markets in particular, are a much more attractive play over the next several years and that a declining dollar will be key in sustaining any level of outperformance. The dollar has been declining throughout the month of December and the fact that it's started drifting lower again following Friday's jobs report spike could be indicating that the year-long rally is starting to fizzle out.
Precious metals are also looking weak here. Unemployment data essentially killed any short-term momentum that commodities had been building and should be leading to move back towards the $1400 level for gold. I think gold is still poised for a sizable move higher in 2020 but it's likely headed lower in the short-term before it reverses course.
Here is the full scorecard for the week ahead.