Posted at 15 December 2022 / Categories Market Roundups
Market Roundup
•November US retail sales decline, jobless claims decrease
•BoE, ECB raise rates by 50 bps each, see prolonged tightening
• ECB's Lagarde says inflation risks remain
•Dow down 2.25%, S&P 500 down 2.49%, Nasdaq down 3.23%
•UK Dec BoE MPC vote unchanged 2, 1 forecast, 0 previous
•UK Dec BoE Interest Rate Decision 3.50%,3.50% forecast, 3.00% previous
•UK Dec BoE MPC vote hike 7, 9 forecast, 9 previous
•EU Dec ECB Interest Rate Decision 2.50%,2.50% forecast, 2.00% previous
•EU Dec Deposit Facility Rate 2.00%,2.00% forecast, 1.50% previous
•US Nov Retail Sales Ex Gas/Autos (MoM) -0.2%, 0.9% forecast
•US Nov Core Retail Sales (MoM) -0.2%,0.2% forecast, 1.3% previous
•US Nov Retail Sales (MoM) -0.6%,-0.1% forecast, 1.3% previous
•US Dec Philadelphia Fed Manufacturing Index -13.8,-10.0 forecast, -19.4 previous
•US Dec Philly Fed Business Conditions 3.8,-7.1 previous
•US Dec Philly Fed New Orders -25.8,-16.2 previous
•US Dec Philly Fed Prices Paid 26.40, 35.30 previous
•US Dec Philly Fed Employment -1.8, 7.1 previous
•US Dec Philly Fed CAPEX Index 18.00, 6.40 previous
•US Dec NY Empire State Manufacturing Index -11.20, -1.00 forecast, 4.50 previous
•US Jobless Claims 4-Week Avg 227.25K,230.00K previous
•US Initial Jobless Claims 211K,230K forecast
•US Continuing Jobless Claims 1,671K,1,671K forecast,1,671K previous
•US Nov Manufacturing Production (MoM) -0.6%, -0.1% forecast, 0.1% previous
•US Nov Industrial Production (YoY) 2.51%,3.28% previous
•US Nov Capacity Utilization Rate 79.7%,79.8%forecast,79.9% previous
•US Nov Industrial Production (MoM) -0.2%, 0.1% forecast, -0.1% previous
•US Oct Retail Inventories Ex Auto -0.5%,-0.4% previous
•US Oct Business Inventories (MoM) 0.3%,0.4% forecast, 0.4% previous
• US Natural Gas Storage -50B,-45B forecast, -21B previous
• US 4-Week Bill Auction3.780% ,3.650% previous
Looking Ahead - Economic Data (GMT )
•00:30 Japan Dec Manufacturing PMI 49.0 forecast, 49.0 previous
•00:30 Japan Services PMI 50.3 previous
Looking Ahead - Events, Other Releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro fell on Thursday as investors took profits from a brief surge in the currency after European Central Bank President Christine Lagarde said more interest rate hikes are needed to tame inflation. The ECB raised interest rates for the fourth time in a row, although by less than at its last two meetings, pledged further hikes and laid out plans to drain cash from the financial system as part of its fight against runaway inflation. The euro reached $1.0737, the highest since June 9, before falling back to $1.0627, down 0.36% on the day. Immediate resistance can be seen at 1.0733(23.6%fib), an upside break can trigger rise towards 1.0778(Higher BB).On the downside, immediate support is seen at 1.0611(5DMA), a break below could take the pair towards 1.0590(38.2%fib).
GBP/USD: The British pound fell and gilt yields declined after the Bank of England raised its key interest rate to 3.5% on Thursday in its ninth interest rate increase in a row.The BoE raised its Bank Rate by 50 basis points (bps) in a split vote as it attempts to bring sky-high inflation back down towards its 2% target. Data released this week showed consumer price inflation eased slightly from a 41-year high in November. The pound was last down 0.9% at $1.2305, having been down around 0.7% before the announcement. Sterling hit its highest level in six months at $1.2446 on Wednesday. Immediate resistance can be seen at 1.2283( 5DMA), an upside break can trigger rise towards 1.2438(23.6%fib).On the downside, immediate support is seen at 1.2173 (21DMA),a break below could take the pair towards 1.2137(5DMA).
USD/CAD: The Canadian dollar fell against a broadly stronger greenback on Thursday as a flurry of interest rate hikes, including by the European Central Bank, weighed on sentiment and data showed further weakening in Canada’s housing market. The ECB eased the pace of its interest rate hikes but stressed significant tightening remained ahead.Canadian home sales declined 3.3% in November from October, while the average selling price was down 12% on the year. Separate data for November showed housing starts dipping 0.2% compared with the previous month.The loonie was down 0.9% at 1.3665 to the greenback , approaching its weakest level since early November. It traded in a range of 1.3541 to 1.3674. Immediate resistance can be seen at 1.3666 (23.6%fib), an upside break can trigger rise towards 1.2718(Higher BB).On the downside, immediate support is seen at 1.2609 (5DMA), a break below could take the pair towards 1.3567(38.2%fib).
USD/JPY: The dollar gained against yen on Thursday after the U.S. Federal Reserve signalled higher interest rates for a longer period. The Fed raised interest rates by half-a-percentage point on Wednesday and projected at least an additional 75 basis points of hikes in borrowing costs by the end of 2023.Following the statement, Fed Chair Jerome Powell said the U.S. central bank will deliver more rate hikes next year and it was too soon to talk about cutting rates. Strong resistance can be seen at 138.20(38.2%fib), an upside break can trigger rise towards 139.00(Psychological level).On the downside, immediate support is seen at 136.69(50%fib), a break below could take the pair towards 135.18(61.8%fib).
Equities Recap
Euro zone shares posted their worst daily performance in six months on Thursday, after the European Central Bank delivered its fourth straight interest rate hike and said it expected to keep raising rates further, echoing hawkish commentary from the U.S. Federal Reserve.
UK's benchmark FTSE 100 closed down by 0.93 percent, Germany's Dax ended down by 3.28 percent, France’s CAC finished the day down by 3.09 percent.
U.S. stock indexes closed sharply lower on Thursday, with each of the major averages suffering their biggest daily percentage drop in weeks, as fears intensified that the Federal Reserve's battle against inflation using aggressive interest rate hikes could lead to a recession.
Dow Jones closed down by 2.25 percent, S&P 500 ended down by 2.49 percent, Nasdaq finished the day down by 3.23 percent.
Commodities Recap
Gold prices on Thursday fell by as much as 2% to their lowest in about a week as the dollar advanced after the U.S. Federal Reserve said it will deliver more interest rate hikes next year.
Spot gold dropped 1.2% to $1,785.36 per ounce, as of 09:56 ET (1456 GMT), having earlier slid to a low of $1,771.89. U.S. gold futures fell 1.3% to $1,794.40.
Oil prices slid about 2% on Thursday as traders worried about the fuel demand outlook due to a stronger dollar and further interest rate hikes by global central banks.
After rising for three straight days, Brent futures fell $1.49, or 1.8%, to settle at $81.21 a barrel, while U.S. West Texas Intermediate (WTI) crude fell $1.17, or 1.5%, to settle at $76.11.