Posted at 04 November 2021 / Categories Market Roundups
Market Roundup
•US Oct ADP Nonfarm Employment Change 571K,400K forecast, 568K previous
•US Sep Trade Balance -80.50B forecast, -73.30B previous
•US Oct Markit Composite PMI 57.6,57.3 forecast, 55.0 previous
•US Oct Services PMI 58.7, 58.2 forecast, 54.9 previous
•US Oct ISM Non-Manufacturing Employment 51.6,53.0 previous
•US Oct ISM Non-Manufacturing PMI 66.7,62.0 forecast, 61.9 previous
•US Oct ISM Non-Manufacturing Business Activity 69.8, 59.5 forecast, 62.3 previous
•US Sep Factory Orders (MoM) 0.2%,0.1% forecast, 1.2% previous
•US Sep Cushing Crude Oil Inventories -0.916M,-3.899M previous
•US Sep Crude Oil Inventories 3.291M,2.225M forecast, 4.267M previous
•US Fed Interest Rate Decision 0.25%,0.25%forecast,0.25% previous
Looking Ahead Economic Data (GMT)
•03:00 Australia Oct AIG Services Index 45.7 previous
•05:00 Japan Sep Household Spending (YoY) -3.9% forecast, -3.0% previous
•05:00 Japan Sep Household Spending (MoM) 2.8% forecast, -3.9% previous
Looking Ahead Economic Data (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro strengthened against dollar on Wednesday after the U.S. Federal Reserve said it would begin unwinding its pandemic-era stimulus, but held to its belief that high inflation would prove "transitory" and likely not require a rapid rise in interest rates. The Fed announced a $15 billion monthly cut to its $120 billion in monthly purchases of Treasuries and mortgage-backed securities, but did little to signal when it may begin the next phase of policy "normalization" by raising interest rates. The euro rose to $1.1614 also having rallied on Wednesday after the announcement, gaining 0.29% that day. Immediate resistance can be seen at 1.1651 (50%fib), an upside break can trigger rise towards 1.1670 (Higher BB).On the downside, immediate support is seen at 1.1601 (38.2 % fib), a break below could take the pair towards 1.1537 (23.6%fib).
GBP/USD: Sterling strengthened against dollar on Wednesday after the U.S. Federal Reserve said it would not rush to raise interest rates even as it began unwinding its pandemic-era stimulus. The Fed, on Wednesday, announced a $15 billion monthly cut to its $120 billion in monthly purchases of Treasuries and mortgage-backed securities, but chair Jerome Powell said the U.S. central bank would be "patient" in deciding when to raise its benchmark overnight interest rate from near zero levels. Sterling climbed to $1.3695 , extending Wednesday's 0.51% gain due to the more dovish Fed, and recovering from Tuesday's two-week low of $1.3603.Immediate resistance can be seen at 1.3700 (50%fib), an upside break can trigger rise towards 1.3766 (61.8%fib).On the downside, immediate support is seen at 1.3637(38.2%fib), a break below could take the pair towards 1.3560(23.6%fib).
USD/CAD: The Canadian dollar edged higher against its U.S. counterpart on Wednesday as investors weighed the Federal Reserve's move to taper its bond-buying program, with the loonie recovering from an earlier three-week low which it hit as oil prices tumbled. The Fed said it will begin trimming its monthly bond purchases in November with plans to end them in 2022, but held its belief that high inflation would prove "transitory" and likely not require a fast rise in interest rates. The Canadian dollar was trading 0.2% higher at 1.2389 to the greenback, after touching its weakest intraday level since Oct. 13 at 1.2457.Immediate resistance can be seen at 1.2430 (50%fib), an upside break can trigger rise towards 1.2470(30DMA).On the downside, immediate support is seen at 1.2376(38.2%fib), a break below could take the pair towards 1.2314 (23.6%fib).
USD/JPY: The dollar held within striking distance of the year's peaks against yen on Wednesday after the U.S. Federal Reserve, as expected, approved plans to begin scaling back its bond-buying stimulus program this month and end it by June. At the end of its two-day meeting on Wednesday, the Fed said monthly $120 billion purchases of Treasuries and mortgage-backed securities would be trimmed by $15 billion a month starting this month, with plans to end the program in 2022. Strong resistance can be seen at 114.31 (23.6%fib), an upside break can trigger rise towards 115.00 (Psychological level).On the downside, immediate support is seen at 113.78(38.2% fib), a break below could take the pair towards 113.37 (50%fib).
Equities Recap
European shares finished at a record high on Wednesday following a strong batch of quarterly earnings, while heavyweight mining stocks recovered from recent losses as commodity prices rose.
UK's benchmark FTSE 100 closed down by 0.36 percent, Germany's Dax ended up by 0.03 percent, France’s CAC finished the day up by 0.34 percent.
U.S. stocks moved modestly higher on Wednesday after the Federal Reserve said it will begin trimming its monthly bond purchases in November with plans to end them in 2022..
Dow Jones closed up by 0.29%percent, S&P 500 closed down by 0.65% percent, Nasdaq settled up by 1.04 % percent.
Treasuries Recap
U.S. Treasury yields rose and the curve steepened on Wednesday after the Federal Reserve, as expected, said it would commence tapering asset purchases this month, but stuck with its contention that high inflation would be transitory and not likely to lead to a faster rise in interest rates.
The benchmark 10-year yield, which fell to a 2-1/2-week low of 1.519% earlier in the session, climbed to a session high of 1.602%. It was last up 4.2 basis points at 1.5893%.
Commodities Recap
Gold prices held near their weakest level since mid-October on Wednesday after the U.S. Federal Reserve announced tapering of its pandemic-era stimulus measures in a widely expected move.
Spot gold was down 0.9% at $1,770.61 per ounce by 14:51 EDT (1851 GMT), marginally paring losses after the Fed decision. It had earlier hit its lowest since Oct. 13 at $1,757.63.U.S. gold futures settled down 1.4% at $1,763.9.
Oil prices fell to a near four-week low on Wednesday, after U.S. crude stocks rose more than expected, as gasoline inventories in the world's largest oil consumer hit a four-year low.
Brent crude futures fell $2.73, or 3.2%, to settle at $81.99 a barrel, while U.S. West Texas Intermediate (WTI) crude fell $3.05, or 3.6%, to settle at $80.86.