Posted at 22 October 2022 / Categories Market Roundups
Market Roundup
•Canada Manufacturing Sales (MoM) -2.0% previous
•Canada Wholesale Sales (MoM) -0.2% ,1.4% previous
•Canada Sep New Housing Price Index (MoM) -0.1%,0.2% forecast, 0.1% previous
•Canada Aug Core Retail Sales (MoM) 0.7%, 0.4% forecast, -3.1% previous
•Canada Aug Retail Sales (MoM) 0.7%,0.2% forecast,-2.5% previous
•EU Oct Consumer Confidence -27.6,-30.0 forecast,-28.8 previous
•US Baker Hughes Oil Rig Count 612,610 previous
•U.S. Baker Hughes Total Rig Count 771,769 previous
• US Federal Budget Balance -430.0B,-173.5B forecast, -220.0B previous
Looking Ahead - Economic Data (GMT)
•No data ahead
Looking Ahead - Events, Other Releases (GMT)
•No events ahead
Currency Summaries
EUR/USD: The euro strengthened on Friday as dollar weakened after a report suggested that Federal Reserve is likely to debate in two weeks whether to signal plans for a smaller interest rate hike in December. The market is pricing in a 75 basis-point hike when Fed policymakers meet on Nov. 1-2, but the U.S. central bank is divided on whether they hike another 75 bps in December or reduce the pace of their tightening to 50 bps, the Wall Street Journal reported on Friday.Fed officials would want to prepare investors for such a decision in the weeks after the Federal Open Market Committee meeting in November, the report added .Immediate resistance can be seen at 0.9900(38.2%fib), an upside break can trigger rise towards 1.1032 (50%ib).On the downside, immediate support is seen at 0.9771(21DMA), a break below could take the pair towards 0.9731(23.6%fib).
GBP/USD: Sterling initially dipped on Friday but recovered most of the ground as investors digested the news that British Prime Minister Liz Truss had quit after just six weeks in office. Truss was brought down by an economic programme that sent shockwaves through markets and shattered the country’s reputation for financial stability.The Conservative Party, which holds a big majority in parliament and need not call a nationwide election for another two years, will now elect a new leader by Oct. 28 - Britain’s fifth prime minister in six years. Immediate resistance can be seen at 1.1393(38.2%fib), an upside break can trigger rise towards 1.1500 (Psychological level).On the downside, immediate support is seen at 1.1142(21DMA), a break below could take the pair towards 1.0932(23.6%fib).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Friday, giving up gains it made after data showing stronger-than-expected GDP growth for the second quarter, as oil prices fell and the greenback broadly rallied.The Canadian economy expanded at a surprisingly strong annualized rate of 3.7% in the second quarter, a pace much higher than the Bank of Canada had predicted, thanks to a resurgence in goods exports, although business investment declined and growth in consumer spending slowed, Statistics Canada data indicated. The Canadian dollar was trading 0.3% lower at 1.3325 to the greenback.The currency, which was down 1% for the month, traded in a range of 1.3247 to 1.3328. Immediate resistance can be seen at 1.3713 (21DMA), an upside break can trigger rise towards 1.3791 (23.6%fib).On the downside, immediate support is seen at 1.3622 (38.2%fib), a break below could take the pair towards 1.3583 (30DMA).
USD/JPY: The U.S. dollar tumbled against the yen on Friday, logging its biggest daily drop against the Japanese currency in more than two months as traders and strategists said Japanese authorities may be in the market to stem a slide in their battered currency. The Japanese government and the Bank of Japan conducted yen-buying, dollar-selling intervention in the foreign exchange market, the Nikkei newspaper said early on Saturday.Japan's Ministry of Finance declined to comment on the matter.The yen rose as high as 144.5 per dollar on Friday, before paring gains to trade up about 1.4% at 148.195, its biggest daily jump since August 10.. Strong resistance can be seen at 148.22(38.2%fib), an upside break can trigger rise towards 151.38 (23.6%fib).On the downside, immediate support is seen at 145.86(50%fib), a break below could take the pair towards 145.36(30DMA).
Equities Recap
European stocks closed broadly lower on Friday, weighed down by fears about a global recession, and worries on the political front.
The UK's benchmark FTSE 100 closed up by 0.37 percent, Germany's Dax ended down by 0.29 percent, and France’s CAC finished the down by 0.85 percent.
Wall Street closed sharply higher and benchmark Treasury yields hit pause on Friday following signals that the Federal Reserve might consider less aggressive inflation-curbing tactics after November.
Dow Jones closed up by 2.47 percent, S&P 500 ended up 2.37 percent, Nasdaq finished the day up by 2.31 percent
Treasuries Recap
After touching the highest level since 2007, 10-year U.S. Treasury yields eased on the news of a potential Fed debate on reducing the size of interest rate hikes in December.
Benchmark 10-year notes last rose 2/32 in price to yield 4.2209%, from 4.226% late on Thursday.
The 30-year bond last fell 56/32 in price to yield 4.3369%, from 4.215% late on Thursday.
Commodities Recap
Gold prices were on track to gain for the week, rising more than 1% on Friday as the dollar weakened amid reports of a potential debate amongst the U.S. Federal Reserve officials about the pace of rate hikes.
Spot gold was up 1.5% at $1,652.21 per ounce by 2:06 p.m. ET (1806 GMT). U.S. gold futures settled up 1.2% to $1,656.3.
Oil prices settled up on Friday as hopes of stronger Chinese demand and a weakening U.S. dollar outweighed concern about a global economic downturn and the impact of interest rate rises on fuel use.
Brent crude settled at $93.50 a barrel, up $1.12, or 1.2%. U.S. West Texas Intermediate crude (WTI) settled at$85.05 a barrel, up 54 cents, 0.6%. During the session, both benchmarks had been down by more than a dollar.