Posted at 15 November 2022 / Categories Market Roundups
Market Roundup
• EU French 12-Month BTF Auction 2.374%, 2.344% previous
•EU French 3-Month BTF Auction 1.431%,1.301% previous
•EU 14:00 French 6-Month BTF Auction1.759%, 1.726% previous
• US 3-Month Bill Auction 4.155%, 4.120% previous
•US 6-Month Bill Auction 4.440%,4.490% previous
Looking Ahead - Economic Data (GMT )
•02:00 China Oct Industrial Production (YoY) 5.2% forecast, 6.3% previous
•02:00 China Oct Fixed Asset Investment (YoY) 5.9% forecast, 5.9% previous
•02:00 China Oct Chinese Industrial Production YTD (YoY) 3.9% previous
•02:00 China Chinese Unemployment Rate 5.5% forecast, 5.5% previous
Looking Ahead - Events, Other Releases (GMT)
•00:30 Australia RBA Meeting Minutes
Currency Summaries
EUR/USD: The euro dipped against dollar on Monday as investors anticipated further monetary tightening measures from the European Central Bank amid fading hopes of a less aggressive approach from the Federal Reserve. Analysts pointed to ECB policymaker Pablo Hernandez de Cos saying the central bank might announce a start date for its quantitative tightening at its December meeting. Market participants will assess the European Union’s gross domestic product (GDP) growth rate on Tuesday for further insights on the latest ECB dovish pivot and recessionary risks in the euro zone. The euro was last down 0.01% against the dollar at $1.0319, after earlier rising to a three-month high of $1.0368. Immediate resistance can be seen at 1.0362(Daily high), an upside break can trigger rise towards 1.0421 (23.6%fib).On the downside, immediate support is seen at 1.0250 (38.2%fib), a break below could take the pair towards 1.0171 (Nov 11th low).
GBP/USD: Sterling fell against the dollar on Monday as traders braced for the UK government’s fiscal statement on Thursday in a data-heavy week that could shed light on the state of Britain’s economy. Finance minister Jeremy Hunt said he will set out tax rises and spending cuts this week to show Britain can fix its public finances and restore economic credibility after financial market chaos sparked by former prime minister Liz Truss. The market is also looking ahead to unemployment and wage data on Tuesday, consumer price data on Wednesday and October retail sales data due on Friday for a read on the state of the UK economy. Immediate resistance can be seen at 1.1851 (23.6%fib), an upside break can trigger rise towards 1.1925(Higher BB).On the downside, immediate support is seen at 1.1655(Nov 11th low), a break below could take the pair towards 1.5266(38.2%fib).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Monday as oil prices fell and the greenback rallied against a basket of major currencies, but the decline was limited ahead of key domestic inflation data this week.Canada’s inflation report for October, due on Wednesday, could help guide expectations for the Bank of Canada’s interest rate outlook.Money markets expect the central bank to hike rates by at least 25 basis points at its Dec. 7 policy announcement and for the policy rate to peak at between 4.25% and 4.50% in the coming months. The Canadian dollar was trading 0.3% lower at 1.3289 to the greenback, or 75.25 U.S. cents, after moving in a range of 1.3240 to 1.3309. Immediate resistance can be seen at 1.3365(38.2%fib), an upside break can trigger rise towards 1.3429(9DMA).On the downside, immediate support is seen at 1.3254(38.2%fib), a break below could take the pair towards 1.3168(Lower BB).
USD/JPY: The dollar strengthened against the yen on Monday as investors kept their focus on the Federal Reserve’s interest rate hiking path after a policymaker said too much was being made of last week’s cooler U.S. inflation data. Fed Governor Christopher Waller said on Sunday the Fed might consider slowing the pace of rate increases at its next meeting but that should not be seen as a “softening” of its battle against inflation.U.S. consumer sentiment fell in November, pulled down by persistent worries about inflation and higher borrowing costs, a survey showed on Friday.Fed fund futures are now pricing in an 91% chance of a 50-basis point rate hike at the Fed’s December meeting. Strong resistance can be seen at 141.89(23.6%fib), an upside break can trigger rise towards 142.36(Nov 12th high).On the downside, immediate support is seen at 139.00(38.2%fib), a break below could take the pair towards 137.22(50%fib).
Equities Recap
European shares closed higher on Monday driven by positive updates from companies including Germany's Infineon and Britain's Informa, while investors positioned themselves for a slew of data including inflation and flash GDP due this week.
UK's benchmark FTSE 100 closed up by 0.92 percent, Germany's Dax ended up by 0.62 percent, France’s CAC finished the day up by 0.22 percent.
Wall Street's main indexes ended lower on Monday, with real estate and discretionary sectors leading broad declines, as investors digested comments from U.S. Federal Reserve officials about plans for interest rate hikes and looked for next catalysts after last week's big stock market rally.
Dow Jones closed down by 0.63 percent, S&P 500 closed down by 0.89% percent, Nasdaq settled down by 1.12% percent.
Treasuries Recap
U.S. Treasury yields edged up on Monday, unwinding some of last week's big price gains, after a Federal Reserve official said the central bank would not soften its stance on inflation.
The 10-year yield was last up 7 basis points (bps) at 3.901%, having fallen by 33 bps last week, its largest weekly decline in over two and a half years. The two-year yield , which is the most sensitive to changes in rate expectations, was last up 6.7 bps at 4.393%, posting its biggest daily gain since Nov. 3.
Commodities Recap
Gold steadied on Monday as bargain hunting offset pressure from the dollar’s advance following the U.S. Federal Reserve’s signs that it was not softening its fight against inflation.
Spot gold rose 0.1% to $1,772.94 per ounce by 01:32 p.m. ET (1832 GMT) after falling 1% earlier in the day.U.S. gold futures settled up 0.4% at $1,776.9.
Oil prices settled around $3 lower on Monday, dragged down by a firmer U.S. dollar while surging coronavirus cases in China dashed hopes of a swift reopening of the economy for the world's biggest crude importer.
Brent crude futures settled down $2.85, or 3%, at $93.14 a barrel after gaining 1.1% on Friday. WTI crude futures settled down $3.09, or 3.47%, to $85.87 after advancing 2.9% on Friday.