06:09 AM EST, 12/19/2024 (MT Newswires) -- Commerzbank in its "European Sunrise" note of Thursday highlighted:

Markets: United States Treasuries bear-flatten viciously into New York close, short-end stabilizes in Asia, long-end futures hit new lows with 10s above 4.5%. Fed funds forwards discount only one more full cut for next year. SPX closes below 6000 (-3%), Asian equities track move lower. US dollar rallies with EUR below $1.04, Brent retreats below $73/barrel.

Fed cuts fed funds target range by 25bps and RRP by 30bps, as expected, but dots and comments are clearly on the hawkish side. Median dot takes out two of the four cuts for next year, core PCE inflation projection rises to 2.5% from 2.2%. Chair Jerome Powell says decision "was a closer call," statement signals "we are at or near a point at which it will be appropriate to slow the pace of further adjustments," Fed is "significantly closer to neutral."

US: President-elect Donald Trump opposes the stopgap bill, calls on Democrats to terminate or raise the debt ceiling. House majority leader Syeve Scalise says the bill is dead and there is no deal yet to avoid a government t shutdown later in the week.

==EUROPE:

Germany: Volkswagen is close to a deal with labor unions that would keep all factories in Germany open (media reports).

EU: European Commission's Kaja Kallas calls to stop suggesting peace talks to Ukraine but instead to ensure that promises made aren't empty. German Prime Minister Olaf Scholz says the EU and the incoming US administration need a common Ukraine policy.

France: Senate approves stopgap bill to keep govt functioning from January until a budget for 2025 is implemented.

==ASIA:

Japan: The central bank leaves rates unchanged, with one member proposing a 25bps hike, maintains its view on the economy and consumption. Review of the past 25 years warns that unconventional steps cannot substitute rate policy, notes that large-scale easing had a negative impact on the functioning of the Japanese government bond market which may not fully recover.