Market Roundup
- U.S. retail sales barely rise as auto purchases fall, Oct +0.1% vs 0.3% forecast, USD moves lower.
- U.S. producer prices fall for second straight month; 1-yr through Oct PPI fell 1.6%.
- U.S. business inventories rise (+0.3%); Q3 growth likely to be raised.
- U.Mich consumer sentiment index at highest since matching 93.1 in July, provides boost for USD.
- Atlanta Fed: GDPNow f/c U.S. economy seen expanding 2.3 percent in 4th quarter ‘unchanged’ from Nov 4.
- Wall St dragged down by retail, technology stocks.
- Gold eyes fourth weekly loss as investors count on Fed rate rise.
- Fed’s Mester says ‘gradual’ pace of rate hikes means not every meeting.
- Traders dial back Dec US rate-hike bets after weak data, CME Fedwatch goes from 70% to 64% back to 70%.
- Slower EZ growth gives ECB ammunition to act in December (EZ expanded 0.3% in Q3 v 0.4% forecast).
- Brazil’s Rousseff agrees to replace FinMin Levy, Valor reports; USD/BRL rises.
- Bank of Canada: negative rates lessen need to hike inflation target, analysis need on whether negative rates are a viable policy tool over extended period of time.
Looking Ahead – Economic Data (GMT)
- 21:45 New Zealand Retail Sales Volumes QQ* Q3 forecast 1.25%, 0.1%-previous
- 21:45 New Zealand Retail Qrtly Vs Yr Ago*Q3 forecast 5.6%, 5.9%- previous
- 23:50 Japan GDP QQ Q3 forecast -0.1%, -0.3%- previous
- 23:50 Japan GDP QQ Annualised Q3 forecast -0.2%, -1.2%- previous
- 23:50 Japan GDP QQ Pvt Consumption Prelim Q3 forecast 0.4%, -0.7%- previous
- 23:50 Japan GDP QQ Capital Expend Q3 f/c -0.4%, -0.9%- previous
- 23:50 Japan GDP QQ External Demand Q3 forecast 0%, -0.3%- previous
- 00:30 Australia New Motor Veh Sales m/m Oct 5.5%- previous
Looking Ahead – Events, Other Releases (GMT)
- Sat Nov 14 G20 Summit in Antalya, Turkey begins (to Nov 16)
Currency SummariesEUR/USD is likely to find support at 1.0706 levels and currently trading at 1.0761 levels. The pair has made session high at 1.0768 and hit lows at 1.0712 levels. The dollar rose against euro on Friday as comments from Federal Reserve officials and U.S. economic data kept the spirits high that the U.S. central bank may raise interest rates in December. Comments from Fed Vice Chair Stanley Fischer late Thursday and from Cleveland Fed President Loretta Mester on Friday underpinned the widely held belief that the Fed intends to raise rates at its next meeting in December. In late trading, the euro was down 0.7 percent to $1.0739, reversing gains seen in the last two sessions. On the week, however, the euro was little changed. The dollar index, which measures the dollar against a basket of currencies, rose 0.3 percent to 98.948. The index sent it 0.2 percent lower this week as profit-taking sent it lower against basket of currencies this week. To the upside, immediate resistance can be seen at 1.0780. To the downside, immediate support level is located at 1.0730 levels.GBP/USD is supported in the range of 1.5170 and currently trading at 1.5236 levels. It reached session high at 1.5236 and hit low at 1.5185 levels. Sterling inched lower against the dollar on Friday, after a senior Bank of England policymaker said BOE would not increase its interest rate immediately if Federal Reserve hikes its rate. The pound had lost ground against the greenback in recent days after the BoE ruled out rate hike plans in the near term, while a better than expected U.S. jobs report kept the chances of a hike by the Federal Reserve very much alive. Along with uncertainty over when the BoE would raise rates, sentiment towards the pound has been weighed down over a referendum on Britain’s membership of the European Union. Sterling was down 0.1 percent at $1.5218, having risen to a day’s high of $1.5270 after U.S. retail sales and producer prices came below expectations. But the soft data had little impact to alter chances of a rate hike by the Fed next month. Markets are pricing in a 70 percent chance of a liftoff. Investors think UK inflation and retail sales data due next week are unlikely to change the outlook for monetary policy. To the upside, immediate resistance can be seen at 1.5260. To the downside, immediate support level is located at 1.5185levels.USD/JPY is supported around 122.48 levels and currently trading at 122.61 levels. It hit session high at 122.93 and made session lows at 122.58 levels. The US dollar declined against Japanese’s Yen on Thursday after the data release from US showed U.S. consumer sentiment came better than expected, gaining for the second straight month and showed an improvement in buying plans for large discretionary purchases, especially vehicles. Report showed that the University of Michigan’s consumer sentiment index rose to 93.1 in early November from an earlier reading of 90.0 in October. Other data on Friday showed a second straight monthly decline in producer prices as the cost of services fell. Still, the soft inflation and signs of slowing consumer spending. The Commerce Department said retail sales inched up 0.1 percent last month after being unchanged in both September and August. analysts had forecast sales increasing to 0.3 percent. To the upside, immediate resistance can be seen at 123.00. To the downside, immediate support level is located at 122.55 levels. USD/CAD is supported at 1.3290 levels and is trading at 1.3322 levels. It has made session high at 1.3352 and lows at 1.3302 levels. The Canadian dollar slipped to a 6-week low against the greenback on Friday, as the crude prices slipped to fresh 2-1/2-month low and broader gains for the greenback despite softer-than-anticipated U.S. retail sales data. U.S. retail sales fell short of expectations amid a surprise decline in automobile purchases but that did not deter the dollar. The 0.1 percent increase in month-over-month sales was enough to send the dollar higher against the euro, yen, pound and Swiss franc. Meanwhile, Comments by Bank of Canada Senior Deputy Governor Carolyn Wilkins did not have any impact on the movement of the pair during mid-American hours. In a speech in Toronto, she said the current inflation-targeting framework is working well and the bar for change is high. The currency’s strongest level of the session was C$1.3267, while its weakest was C$1.3350. To the upside, immediate resistance can be seen at 1.3350. To the downside, immediate support level is located at 1.3295 levels.Equities RecapEuropean stocks slipped lower on Friday, as the stocks were weighed down weak corporate earnings, resulting their worst weekly loss in almost 2 months.UK’s benchmark FTSE 100 closed down by 1 percent, the pan-European FTSEurofirst 300 ended the day down by 0.89 percent, Germany’s Dax ended down by 0.9 percent, France’s CAC finished the day down by 1.1 percent.U.S. stock slipped sharply on Friday, weighed down Falling oil prices and doubts relating to US interest rates hike plans by Fed in December kept investors worried.Dow Jones closed down by 1.15 percent, S&P 500 ended down by 1.11 percent, Nasdaq finished the day down by 1.55 percent.Treasuries RecapU.S. Treasuries prices rose on Friday, with yields hitting their lowest levels in a week, as weaker-than-expected U.S. retail sales and producer prices data reinforced the view of modest economic growth and tame inflation.Benchmark 10-year Treasuries notes were last up 13/32 in price with a yield of 2.273 percent, down 5 basis points from late on Thursday.The 30-year bond was up 20/32 for a yield of 3.053 percent, down 3 basis points on Friday and about 4 basis points for the week.Commodities RecapOil slumped on Friday, extending the week’s loss to highest in almost eight months, as swelling storage of crude on both land and sea pressured prices.Brent futures settled down $1.75, or 3.8 percent, at $44.06 a barrel. The tumble of the past week has left Brent less than $ 2away from its August lows a and a new 6-1/2 year bottom.U.S. crude futures finished down $1.8, or 2.8 percent, to $41.75.its lowest in August was $ 37.75Gold fell back towards near six-year lows on Friday, on anticipation that the Federal Reserve is set to raise U.S. interest rates next month for the first time in nearly a decade.Spot gold was at $1,082.30 an ounce at 2:13 p.m. EST (1913 GMT), down 0.2 percent, having touched its lowest since February 2010 on Thursday at $1,074.26. U.S. gold futures for December delivery settled down 10 cents an ounce at $1,080.90
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