Market Roundup
- Chicago purchasing management index falls to 48.7 in November, vs forecast 54, 56.2 previous.
- U.S. October pending home sales rise 0.2 pct vs 1% forecast.
- IMF gives China’s currency prized reserve asset status.
- ECB to increase QE (19/20), cut deposit rate (13/20) at Dec 3 meeting.
- Brazil’s BTG Pactual looks to new leadership; Esteves quits amid graft probe; BRL lower.
- Global funds raise U.S. equity holdings, eye emerging markets for 2016 bounce.
- Michael R. Bloomberg to chair newly formed working group on U.S. RMB trading and clearing.
Looking Ahead – Economic Data (GMT)
- 22:30 Australia AIG Manufacturing Index * Nov 50.2-previous
- 23:50 Japan Business Capex (MOF) YY*Q3 5.60%-previous
- 01:00 China NBS Non- Manufacturing PMI*Nov 53.1-previous
- 01:00 China NBS Manufacturing PMI*Nov forecast 49.8, 49.8- previous
- 01:45 China Caixin Manufacturing PMI Final * Nov forecast 48.3, 48.3- previous
Looking Ahead – Events, Other Releases (GMT)
- 22:30 Australia- RBA Interest Rate Decision, no change expected (2%)
Currency SummariesEUR/USD is likely to find support at 1.0550 levels and currently trading at 1.0563 levels. The pair has made session high at 1.0585 and hit lows at 1.0558 levels. The dollar hit an eight-and-a-half-month high against euro on Monday as the prospect of further European Central Bank stimulus dragged the euro down to its weakest since mid-April, while oil prices retreated. Trading was subdued during Monday’s session, with the dollar moving in tight ranges against most rivals. The ECB will meet on Thursday and is widely expected to cut interest rates on euro deposits and extend its quantitative easing program. Other measures that would weaken the euro zone currency are also reportedly being considered. By contrast, the Fed is expected to raise U.S. interest rates for the first time in almost a decade later in December, based on a succession of data shows the U.S. economy growing at a healthy pace. The euro fell 0.2 percent versus the dollar on Monday and has fallen 4 percent against the greenback in November. To the upside, immediate resistance can be seen at 1.0600. To the downside, immediate support level is located at 1.0550 levels.GBP/USD is supported in the range of 1.4990 and currently trading at 1.5057 levels. It reached session high at 1.5067 and hit low at 1.4992 levels. Sterling slipped below $1.50 for the first in almost 7-months on Monday after a policymaker warned about the impact of a strong pound on inflation, but rebounded back as the dollar weakened after soft US data. One of the Bank of England’s monetary policy committee member, said in a newspaper interview over the weekend that the tightening effect of a strong pound was huge and that he wanted to see growth stabilise or pick up before interest rates started to rise. Sterling was up 0.1 percent against dollar at $1.5046, in mid-morning America hours after the Chicago purchasing managers’ index (PMI) fell sharply to 48.7, down from 56.2 in October. To the upside, immediate resistance can be seen at 1.5118. To the downside, immediate support level is located at 1.4992 levels.AUD/USD is supported around 0.7200 levels and currently trading at 0.7243 levels. It hit session high at 0.7249 and made session lows at 0.7200 levels. The Australian dollars edged higher against the greenback on Monday as the investors optimism looked bright ahead of a week packed with events and data. The Australian dollar fell to $0.7173, from $0.7196 late on Friday and a one-month peak of $0.7283 touched last week. Support was found at $0.7159. Much of the strength is due to a diverging interest rate outlook with the European Central Bank expected to announce further stimulus at its policy meeting on Thursday. In contrast, the Reserve Bank of Australia is likely to keep rates steady for a while. To the upside, immediate resistance can be seen at 0.7245. To the downside, immediate support level is located at 0.7200 levels. USD/CAD is supported at 1.3280 levels and is trading at 1.3310 levels. It has made session high at 1.3363 and lows at 1.3315 levels. The Canadian dollar edged higher against the greenback after a drop earlier on Monday, helped by firmer crude oil prices, as attention shifted to a busy week of data and events, including rate decision on Wednesday by Bank of Canada. Oil prices jumped as investors took positions ahead of an OPEC meeting this week, despite speculation that the producer group will not revise its output policy. The Bank of Canada is more likely to hold interest rates at 0.50 percent and keep them on hold through 2016 when it makes its policy announcement. The currency’s strongest level of the session was C$1.3345, while its weakest was C$1.3395, a one-week low. To the upside, immediate resistance can be seen at 1.3389. To the downside, immediate support level is located at 1.3315 levels.Equities RecapEuropean stocks ended on the higher side on Monday as the investors are keenly waiting for key economic data and key meeting by European central bank.UK’s benchmark FTSE 100 closed up by 0.4 percent, the pan-European FTSEurofirst 300 ended the day up by 1.34 percent, Germany’s Dax ended up by 0.8 percent, France’s CAC finished the day up by 0.4 percent.U.S. stocks declined on Monday as the shares declined in health and consumer shares and as investors braced for policy news from central banks.Dow Jones closed down by 0.39 percent, S&P 500 ended down by 0.43 percent, Nasdaq finished the day down by 0.35 percent.Treasuries RecapU.S. Treasuries prices rose modestly on Monday on hesitation ahead of speeches from top Federal Reserve speakers throughout the week and releases of economic data culminating in the November jobs report.Benchmark 10-year Treasuries rose 1/32 in price to yield 2.221 percent, down from 2.222 on late Friday.The 30-year bond gained 10/32 in price to yield 2.98 percent.Commodities RecapGold rose 1 percent on Monday but remained close to its lowest level in almost six years and was on track for its steepest monthly slide in 2-1/2 years on prospects of a U.S. interest rate rise this year as the dollar hit a multi-month high.Spot gold was up 0.9 percent at $1,066.40 an ounce at 2:57 p.m. ET (1957 GMT), just above Friday’s trough at $1,052.46, the lowest since February 2010.Crude oil fell on Monday, reversing an early rally, after a survey estimated higher OPEC output in November and a stronger dollar weighed on demand for commodities priced in the currency.Benchmark Brent crude futures settled down 25 cents, or 0.6 percent, at $44.61 a barrel, after rising nearly $1 earlier.U.S. crude’s West Texas Intermediate (WTI) futures finished the session down 6 cents at $41.65, versus a session high at $42.61.
The material has been provided by InstaForex Company – www.instaforex.com