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Americas Roundup: Dollar falls slightly after biggest weekly gain this year, Sterling recovers ground, Gold jumps more than 1 percent, Oil surges 3 pct-November 7th 2017


Market Roundup

• Trump's Seoul visit to put him at heart of North Korea nuclear standoff.

• Facing pockets of dissent, Republicans begin revising U.S. tax bill.

• Vital that UK's Brexit deal is in U.S. interests, says commerce chief Ross.

• NY Fed President Dudley to retire by mid-2018.

• US Oct Employment trends, 135.6, 132.7 previous 132.9 revised.

• CA Oct Ivey PMI, 63.5, 68.6 previous.

• CA Oct Ivey PMI SA, 63.8, 59.6 previous.

• Oil surges 3 pct, at highest since mid-2015 on Saudi purge

Looking Ahead - Economic Data (GMT)

• 00:00 Japan Sept Overtime Pay, 1.5% previous

• 03:30 Australia Nov RBA Cash rate, 1.50% forecast, 1.50% previous

Looking Ahead - Events, Other Releases (GMT)

• No major events scheduled

Currency Summaries

EUR/USD is supported at 1.1571 levels and currently trading at 1.1611 levels. The pair has made session high at 1.1616 hit lows at 1.1578 levels. The euro was little changed against US dollar on Monday as dollar gave up its initial gains, as uncertainties related to proposed U.S. tax revisions and the future composition of the Federal Open Market Committee discouraged traders from bidding the greenback higher. House Republicans last week unveiled the first draft of a bill that, if enacted, would be the biggest revamp of the U.S. tax system since the 1980s. The House tax-writing committee begins revising the bill on Monday, with tweaks and some more substantial changes expected to a number of individual and corporate tax proposals. The Federal Reserve Bank of New York confirmed that William Dudley, among the most influential monetary policymakers throughout the financial crisis and its aftermath, expects to retire by mid-2018. That raised another question over leadership at the U.S. central bank less than a week after President Donald Trump chose a new Fed chief. The dollar index, which tracks the greenback against six major currencies, was up 0.04 percent at 94.982. The index is just shy of the three-month high of 95.150 hit late last month. The euro was 0.16 percent lower against the greenback.

GBP/USD is supported in the range of 1.3055 levels and currently trading at 1.3163 levels. It reached session high at 1.3168 and dropped to session low at 1.3093 levels. The British pound gained ground against the dollar on Monday after slipping against the dollar for three consecutive weeks, but any strong gains were checked by continued uncertainty around Brexit talks and instability in the governing Conservative party. Investors are monitoring the negotiations around Britain's future relationship with the European Union for the impact not only on business confidence and economic growth, but also on the likelihood of further interest rate increases, after the Bank of England's decision to raise rates last week. BoE Governor Mark Carney said on Thursday that the bank plans two further rate increases in the next three years, but that the outcome of Brexit talks remains a factor shaping future interest rate policy. Pound was up 0.3 percent against the dollar on Monday at $1.3168, after falling for three straight weeks. Against the euro, it was up half a percent at 88.30 pence. Britain’s most powerful business lobby group urged British Prime Minister Theresa May on Monday to provide clarity on how Brexit will work, but she responded with few details beyond reiterating plans to seek a transition deal as soon as possible. Britain enters the next round of Brexit negotiations at the end of this week, during which the all-important topic of its future trade relationship with the EU is due to be discussed for the first time.

USD/CAD is likely to find support at 1.2700 levels and is trading at 1.2727 levels. It has made intraday high at 1.2781 lows at 1.2718 levels. The Canadian dollar strengthened against its U.S. counterpart on Monday as higher oil prices and slightly weaker dollar boosted Canadian dollar across the board. Prices of oil, one of Canada's major exports, reached their highest since July 2015 as Saudi Arabia's crown prince cemented his power over the weekend through an anti-corruption crackdown. Canada's central bank is expected to hold rates steady in December after hiking twice this year. But data on Friday showing unexpected strength in the nation's job market has supported expectations for further increases next year. The Canadian dollar was nearly up 0.3 percent at C$1.2721 to the greenback. The currency traded in a narrow range of C$1.2713 to C$1.2777. On Friday, it touched its strongest in nine days at C$1.2716. Still, speculators have cut bullish bets on the loonie, data from the U.S. Commodity Futures Trading Commission calculations showed on Friday. As of Oct. 31, Canadian dollar net long positions had slipped to 57,839 contracts from 72,332 a week earlier.

AUD/USD is supported around 0.7623 levels and currently trading at 0.7685 levels. It hit session high at 0.7687 and made session lows at 0.7652 levels. The Australian dollar strengthened against US dollar on Monday as investors wagered the country's central bank would reiterate its neutral stance at a policy meeting this week following a run of soft domestic data. The Aussie dollar was last trading at $0.7685, slightly higher from its recent rough at $0.7625.Bulls were still suffering a hangover from disappointing retails sales figures out last Friday that highlighted risks to household consumption from high debt and slow wages growth. With inflation also under the floor of the Reserve Bank of Australia's (RBA) 2 to 3 percent target band, investors have steadily pushed out the timing of any rate hike. The futures market is now not fully pricing in a move until early 2019 , a marked change from a couple of months ago when it was implying a hike by August 2018.The RBA holds its monthly policy meeting on Tuesday and releases updated economic forecasts on Friday, which could see the outlook for inflation trimmed a little.

Equities Recap

European shares ended the day in positive territory on Monday after a session in which promising eurozone economic data and rising oil prices failed to offset some earnings and corporate news disappointment.

UK's benchmark FTSE 100 closed up by 0.1 percent, the pan-European FTSEurofirst 300 ended the day up by 0.15 percent, Germany's Dax ended down by 0.1 percent, France’s CAC finished the day down by 0.2 percent.

U.S. stocks rose to record highs on Monday after Broadcom made a monster bid for Qualcomm and investors bet that a Republican plan to cut corporate taxes would bolster earnings.

Dow Jones closed up by 0.04 percent, S&P 500 ended up 0.13 percent, Nasdaq finished the day up by 0.34 percent.

Treasuries Recap 

The gap between U.S. short-dated and long-dated Treasury yields on Monday contracted to its tightest levels in a decade as sluggish domestic inflation underpinned demand for longer-maturity government bonds.

The benchmark 10-year yield was down 2.5 basis points at 2.318 percent after hitting its lowest level in two weeks, while the two-year yield slipped nearly 1 basis point at 1.617 percent.

The 30-year yield was 2.797 percent, down 2.5 basis points from late Friday.

Commodities Recap

Gold rose more than 1 percent on Monday, extending gains as geopolitical risks drove investors to safe-haven assets after the metal's third-straight weekly decline.

Spot gold was up 1 percent at $1,281.46 an ounce by 1:58 p.m. EST (1858 GMT), while U.S. gold futures for December delivery settled up $12.40, or 1 percent, at $1,281.60 per ounce.

Oil prices rose 3 percent on Monday, hitting the highest since early July 2015, as Saudi Arabia's crown prince cemented his power over the weekend with an anti-corruption crackdown, while the U.S. rig count fell and markets continued to tighten.

Brent crude futures were trading $1.86 or 3 percent higher at $62.46 a barrel by 12:00 p.m. Eastern time (1700 GMT).

U.S. West Texas Intermediate (WTI) crude rose $1.49 or 2.7 percent to $57.13 a barrel.
 

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November 20 20:00 UTC Released

BRCAGED Net Payroll Jobs*

Actual

77 k

Forecast

Previous

77 k

November 20 13:00 UTC Released

RURetail Sales YY

Actual

3.0 %

Forecast

3.9 %

Previous

3.1 %

November 21 13:55 UTC 332332m

USRedbook MM

Actual

Forecast

Previous

-1.2 %

November 21 13:55 UTC 332332m

USRedbook YY

Actual

Forecast

Previous

2.3 %

November 22 12:00 UTC 16571657m

USMBA Mortgage Applications

Actual

Forecast

Previous

3.1 %

November 22 12:00 UTC 16571657m

USMortgage Market Index

Actual

Forecast

Previous

401.7 Bln EUR

November 22 13:30 UTC 17471747m

USJobless Claims 4-Wk Avg

Actual

Forecast

Previous

237.75 k

November 22 13:30 UTC 17471747m

USInitial Jobless Claims

Actual

Forecast

240 k

Previous

249 k

November 22 13:30 UTC 17471747m

USContinued Jobless Claims

Actual

Forecast

1.882 Mln

Previous

1.860 Mln

November 22 14:30 UTC 18071807m

BRForeign Exchange Flows*

Actual

Forecast

Previous

-3.412 Bln USD

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