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Americas Roundup: Dollar up on U.S. policy hopes, sterling swings, Wall Street hits fresh records despite N. Korea missile nerves, Oil prices slip on OPEC deal extension jitters-November 29th 2017

Market Roundup

• US Nov Consumer Confidence, 129.5, 124.0 Reuters forecast, 125.9 previous, 126.2 revised.

• US Oct Build Permits R Chg MM, 7.4%, 5.9% previous.

• US Oct Adv Goods Trade Balance, -68.30 bln, -64.10 bln previous.

• US Oct Wholesale Inventories Adv, -0.4%, 0.3% previous, 0.1% revised.

• US Oct Retail Inventories Advance, 0.4%, -0.1% previous.

• US W/E Redbook, -0.2% m/m, 4.8% y/y; -0.7%, 4.1% previous.

• US Sep Monthly Home Price, 0.3% m/m, 6.3% y/y; 0.7%, 6.6% previous.

• Fed chair nominee Powell defends push to review financial regulations.

• Powell says will incorporate fiscal change into their economic projections when the fiscal changes are done.

• Powell says the best way to sustain economic recovery is to continue on path of gradual rate increases.

• Fed’s Dudley says he opposes U.S. tax stimulus at the current time because the economy does really need it.

• North Korea fires ballistic missile close to Japan –officials.

• UK bows to EU, will assume liabilities worth up to 100 bln euros, FT says.

• OPEC heading for oil cut extension with a caveat.

• Canada Oct Producer Prices MM, 1.0%, 0.5% forecast, -0.3% previous.

• Canada Oct Producer Prices YY, 1.8%, 1.5% previous.

Looking Ahead - Economic Data (GMT)

• 28 Nov 23:50 Japan Oct Retail Sales YY, -0.2% forecast, 2.2% previous

Looking Ahead - Events, Other Releases (GMT)

• 07:00 Japan Deputy Governor Hiroshi Nakaso speaks in Tokyo 

• 13:30 Fed's Dudley speaks in New Brunswick 

• 14:00 BoE's Carney speaks in London

• 14:45 BoE's Deputy Governor Dave Ramsden speaks in London 

• 15:00 Fed's Yellen speaks in Washington

• 17:00 Bundesbank President Jens Weidmann speaks in Frankfurt

• 18:50 Federal Reserve Bank of San Francisco President John C. Williams speaks in Phoenix

Currency Summaries

EUR/USD is likely to find support at 1.1807 levels and currently trading at 1.1844 levels. The pair has made session high at 1.1897 and hit lows at 1.1826 levels. The euro declined against the U.S. dollar on Tuesday as risk sentiment improved and the confirmation hearing of new Federal Reserve chair Jerome Powell kicked off. The U.S. Federal Reserve is likely to raise interest rates again next month, Powell told the Senate Banking Committee. He said the Fed should "respond decisively" to any new economic crisis, positioning himself as an heir to the policies of current chair Janet Yellen and her predecessor Ben Bernanke. Following his confirmation hearing, the U.S. dollar index rose against a basket of six currencies, rebounding from a two-month low the previous day. Markets had a volatile afternoon after news of a North Korean missile launch caused the dollar to pare gains. But dollar regained ground and hit fresh highs as investor focus returned to hopes for U.S. tax cuts. The U.S. Senate budget committee voted along party lines to send a Republican tax bill to the full Senate for a vote. The full Senate is expected to begin debating the tax bill and vote on it sometime this week. The Republican-controlled House of Representatives has already passed its version of a package of tax cuts. The dollar index rose 0.36 percent, with the euro down 0.44 percent to $1.1844.

GBP/USD is supported in the range of 1.3220 levels and currently trading at 1.3360 levels. It reached session high at 1.3386 and dropped to session low at 1.3261 levels. Sterling rose against the dollar on Tuesday as sterling was boosted after The Daily Telegraph newspaper reported that Britain and the European Union had agreed on the Brexit divorce bill, citing unidentified sources. The currency gave up some of its gains after a British government official cast doubt on the newspaper report, but traders said the news offered some support to the struggling currency. Before the report, the British pound was trading as much as 0.7 percent down on the day at $1.3221 against the dollar. It had reversed all of those losses by 1800 GMT and rose as high as $1.3371 after the news in New York trading. From the day's lows to the highs, it had a trading range of more than a percent, a big move for even sterling, which has become increasingly volatile in recent sessions. Against the euro, it rose 0.4 percent against the euro to stand above the 89 pence level.

USD/CAD is supported at 1.2779 levels and is trading at 1.2810 levels. It has made session high at 1.2825 and lows at 1.2789 levels. The Canadian dollar weakened against its U.S. counterpart on Tuesday as a drop in oil prices and a stronger dollar across the board weighed on the Canadian dollar. The price of oil, one of Canada's major exports, fell on uncertainty over the outcome of a key Organization of the Petroleum Exporting Countries meeting this week. Members of the Organization of the Petroleum Exporting Countries and other key producers, including Russia, meet on Nov. 30 to discuss whether to continue to limit production in an effort to drain global inventories to help push up prices. They cut production by 1.8 million barrels per day (bpd) in January and agreed to hold down output until March. The market had expected OPEC to extend the limits by another six to nine months, but this is now less certain. The Canadian dollar was last trading at C$1.2813 to the greenback, down 0.2 percent. The currency's strongest level of the session was C$1.2756, while it touched its weakest since Nov. 21 at C$1.2824.

USD/JPY is supported around 110.82 levels and currently trading at 111.40 levels. It peaked to hit session high at 111.64 and made session lows at 111.04 levels. The U.S. dollar strengthened against the Japanese yen on Tuesday as traders eyed progress on U.S. tax reform, strong economic data and comments from Federal Reserve chair nominee Jerome Powell. The dollar was also helped upbeat U.S consumer confidence data. U.S consumer confidence surged to a near 17-year high in November, driven by a robust labor market, while house prices rose sharply in September, which should underpin consumer spending and boost economic growth. The Conference Board said its consumer confidence index increased 3.3 points to a reading of 129.5 this month, within striking distance of 132.6, which was touched in November 2000. The strong confidence reading largely reflected households' upbeat perceptions of the labor market.

Equities Recap

Wind turbine makers and oil major Royal Dutch Shell propelled European stocks higher on Tuesday, boosting sentiment on the energy sector ahead of Thursday's OPEC meeting, while dispelled political risks in Ireland also supported the market.

UK's benchmark FTSE 100 closed up by 1.1 percent, FTSEurofirst 300 ended the day up by 0.63 percent, Germany's Dax ended up by 0.5 percent, and France’s CAC finished the day up by 0.6 percent.

Wall Street surged to record closing highs on Tuesday, led by sharp gains in bank stocks and boosted by progress for a tax cut bill, strong consumer confidence data and encouraging comments from President Donald Trump's nominee to lead the Federal Reserve.

Dow Jones closed up by 1.09 percent, S&P 500 ended up 0.99 percent, Nasdaq finished the day up by 0.49 percent.

Treasuries Recap 

U.S. Treasury yields inched higher on Tuesday, as risk appetite improved with Wall Street shares hitting record highs after upbeat consumer confidence data and a Senate panel vote to advance a U.S. tax bill.

In late trading, the 10-year Treasury yield was up at 2.336 percent, from 2.328 percent late on Monday.

U.S. two-year yields, which climbed to a nine-year peak last week, were at 1.754 percent from 1.745 percent on Monday.

U.S. 30-year bond yields were up slightly at 2.766 percent from Monday's 2.765 percent.

Commodities Recap

Gold prices dipped on Tuesday as dollar was boosted following a confirmation hearing for U.S. Federal Reserve chair nominee, Jerome Powell.

Spot gold dipped 0.1 percent to $1,292.70 an ounce by 3:41 p.m. EST (2041 GMT), while U.S. gold futures for December delivery settled up 50 cents, or 0.04 percent, at $1,294.90 per ounce.

U.S. gold futures for December delivery settled up 50 cents, or 0.04 percent, at $1,294.90 per ounce.

Oil prices eased on Tuesday, weighed down by uncertainty over the outcome of an OPEC meeting this week at which an extension to its price-supporting oil output cuts will be discussed.

Brent crude oil ended the session down 23 cents, or 0.4 percent, at $63.61 a barrel. U.S. crude settled 12 cents, or 0.2 percent lower at $57.99, after falling 1.4 percent in the previous session.


 

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December 15 13:30 UTC Released

CAManufacturing Sales MM

Actual

-0.4 %

Forecast

0.8 %

Previous

0.5 %

December 15 13:30 UTC Released

USNY Fed Manufacturing

Actual

18 %

Forecast

18.6 %

Previous

19.4 %

January 9 11:00 UTC 3582035820m

BRRetail Sales MM*

Actual

Forecast

0.35 %

Previous

January 9 11:00 UTC 3582035820m

BRRetail Sales YY*

Actual

Forecast

3.20 %

Previous

January 9 11:00 UTC 3582035820m

BRRetail Sales YY*

Actual

Forecast

3.20 %

Previous

January 9 11:00 UTC 3582035820m

BRRetail Sales YY*

Actual

Forecast

3.20 %

Previous

January 9 11:00 UTC 3582035820m

BRRetail Sales MM*

Actual

Forecast

0.35 %

Previous

January 9 11:00 UTC 3582035820m

BRRetail Sales YY*

Actual

Forecast

3.20 %

Previous

December 12 09:30 UTC 45914591m

GBRPIX YY

Actual

Forecast

Previous

4.2 %

December 12 09:30 UTC 45914591m

GBPPI Input Prices MM NSA

Actual

Forecast

Previous

1 %

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