Market Roundup
- U.S. jobless claims revisit 42-year lows, claims fell 7k to SA 255k.
- U.S. CPI falls 0.2% on cheaper gasoline, but core +0.2%; US real avg weekly earnings -0.2 v +0.4 previous.
- Yields rise after U.S. data supports view of earlier Fed rate hike.
- Fed’s Dudley downplays divisions at Fed, say policymakers on same page.
- Fed’s Dudley would favor Dec.rate hike if economy meets his forecast, says recent economic news suggest economy slowing; confident tightening job market to lead to inflation.
- Treasury’s Lew says U.S. will hit debt ceiling no later than Nov. 3.
- Fitch cuts Brazil rating to ‘BBB-“, says investment grade at risk.
- China’s Premier Li says economy remains within reasonable range.
- Nowotny easing talk nudges euro lower.
- Chance of oil falling below $20 is under 50 percent-Jeff Currie Goldman Sachs
Looking Ahead – Economic Data (GMT)
- 21:45 New Zealand CPI QQ*Q3 forecast 0.2%, 0.40%-previous
- 21:45 New Zealand CPI YY*Q3 forecast 0.3%, 0.30%-previous
- 23:50 Japan Foreign Bond Investments w/e -1261.5b-previous
- 23:50 Japan Foreign Investments Japanese Stock w/e -177.3b-previous
- 02:00 Japan TR IPSOS PCSI Oct 43-previous
- 02:00 Australia TR IPSOS PCSI Oct 48.2-previous
- 02:00 China TR IPSOS PCSI Oct 63.3-previous
Looking Ahead – Events, Other Releases (GMT)
- 03:00 Australia -Reserve Bank of Australia releases Financial Stability Review
- 06:35 Japan -Bank of Japan Governor Kuroda speaks at the National Savings & Loan Association
Currency SummariesEUR/USD is likely to find support at 1.1350 levels and currently trading at 1.1374 levels. The pair has made session high at 1.1417 and hit lows at 1.1358 levels. The dollar rose against euro on Thursday as underlying domestic inflation strengthened more than expected in September, reviving some expectations the Federal Reserve would raise interest rates this year. The core consumer price inflation, which strips out food and energy costs, rose 0.2 percent after ticking up 0.1 percent in August, and somewhat allayed fears that a disinflationary trend was asserting itself in the world’s largest economy. The rebound of the dollar index from a seven-week low set earlier on Thursday was limited by remarks from New York Fed President William Dudley, which traders perceive to suggest a December rate hike is far from a sure-bet, although he repeated a year-end rate move is likely if the economy improves further. The euro was down 0.8 percent at $1.1384, retreating from an earlier peak of $1.1495, its strongest since Aug. 26. To the upside, immediate resistance can be seen at 1.1415. To the downside, immediate support level is located at 1.1350 levels.GBP/USD is supported in the range of 1.5411 levels and currently trading at 1.5477 levels. It reached session high at 1.5508and dropped to session low at 1.5409 levels. Sterling retreated from three-week highs against the dollar on Thursday, after a stronger-than-expected rise in core U.S. consumer prices in September revived bets inflation is edging closer to the Federal Reserve’s two percent target. The pound delivered its best daily performance in seven months on Wednesday after Britain’s unemployment rate hit its lowest since mid-2008, climbing 1.5 percent against the dollar. The labour market data also showed earnings growing slightly more weakly than expected, and came a day after inflation was shown to have fallen back below zero in September. A run of weaker data from the UK, as well as wider worries about global growth, have seen investors push back their expectations of when the BoE will start raising rates to the end of 2016. Sterling was down 0.3 percent at $1.5440, having hit a high of $1.5507, its highest since Sept. 22. Both the United States and the UK are grappling with headline inflation that is anchored around zero. To the upside, immediate resistance can be seen at 1.5492. To the downside, immediate support level is located at 1.5435 levels.USD/JPY is supported around 118.05 levels and currently trading at 118.91 levels. It made session high at 119.93 and hit session lows at 118.22 levels. The dollar edged higher against the Japanese yen on Tuesday, after U.S. consumer prices recorded their biggest drop in eight months in September as the cost of gasoline fell, but a steady pick-up in the prices of other goods and services suggested inflation was poised to rise. The Labor Department said its Consumer Price Index fell 0.2 percent last month after slipping 0.1 percent in August. In the 12 months through September, the CPI was unchanged for the first time in four months. It rose 0.2 percent in August. The greenback weakened further against the yen on bets the Fed would not raise rates in 2015 due to the weakening global outlook. It hit an eight-month low earlier at 118.07 yen before retracing to 118.69 yen, down 0.1 percent from Wednesday. To the upside, immediate resistance can be seen at 119.00. To the downside, immediate support level is located at 118.70levels. USD/CAD is supported at 1.2804 levels and is trading at 1.2848 levels. It has made session high at 1.2947 and lows at 1.2825 levels. The Canadian dollar hit its strongest level against its U.S. counterpart since late July on Thursday, before pulling back after a rise in U.S. inflation offset recent weak data that could delay an expected increase in U.S. interest rates. Data showed U.S. consumer prices recorded their biggest drop in eight months in September as the cost of gasoline fell, confirming a low-inflation environment. The loonie slipped to a session low at 1.2947 shortly after at the data figures were released, after the market stabilized the loonie started to gain its early losses against US dollar, by the late US session the loonie pared all the losses it made earlier to trade around 1.2862 levels. The data, coming on the back of weak retail sales, added to the uncertainty over the timing of an interest rate increase as the Federal Reserve waits for signs of stabilizing global economy. The currency’s strongest level of the session was C$1.2861, a level last seen on July 29, while its weakest level was C$1. the upside, immediate resistance can be seen at 1.2870. To the downside, immediate support level is located at 1.2830 levels.Equities RecapEuropean shares rose on Thursday, bouncing back after three days of losses, with retailer Casino and consumer goods maker Unilever lifted by positive results.UK’s benchmark FTSE 100 closed up by 1.1 percent, the pan-European FTSEurofirst 300 ended the day up by 1.4 percent, Germany’s Dax ended up by 1.5 percent, France’s CAC finished the day up by 1.51 percent.U.S. stocks rallied on Thursday after two days of losses, led by a jump in financial shares following upbeat results from Citigroup.Dow Jones closed up by 1.29 percent, S&P 500 ended up by 1.48 percent, Nasdaq finished the day up 1.82 percent.Treasuries RecapU.S. Treasuries yields rose slightly on Thursday after data showed a measure of U.S. consumer prices that strips out food and energy costs rose more than expected in September, marginally supporting views of a 2015 Federal Reserve rate hike.U.S. 30-year Treasury bonds were last down 12/32 in price to yield 2.86 percent, from a yield of 2.84 percent late Wednesday. Benchmark 10-year Treasury notes were last down 10/32 to yield 2.02 percent, from a yield of 1.98 percent late Wednesday.U.S. three-year notes, which are among the short-dated notes considered most vulnerable to Fed rate hikes, were last down 4/32 to yield 0.89 percent, from a yield of 0.84 percentCommodities RecapGold pared gains after reaching a 3-1/2-month high on Thursday as a stronger-than-expected reading of U.S. inflation drove the dollar index.Spot gold was up 0.1 percent at $1,185.73 an ounce at 2:56 p.m. EDT (1856 GMT), after climbing to $1,190.63, the highest since June 22 and the fifth straight day higher.U.S. gold futures for December delivery settled up $7.70 an ounce, or 0.7 percent, at $1,187.50.Oil prices fell on Thursday after the U.S. government reported a larger-than-expected crude stockpile build, leaving prices lower for a fourth straight day.U.S. crude’s front-month contract, November, settled down 26 cents, or 0.6 percent, at $46.38 a barrel. At the session low it was down $1.41, or 2 percent.Brent’s front-month, November, finished down 44 cents at $48.71 before expiring and going off the board. December Brent, which will be the spot contract from Friday, was more actively traded than November, settling up 4 cents at $49.73.
The material has been provided by InstaForex Company – www.instaforex.com