Market Roundup
• British parliament to vote on PM May's Brexit deal on Dec 11.
• Euro slips as Draghi notes slowing growth.
• Bitcoin sinks as cryptocurrency sell-off gathers pace.
• IMF approves 2nd review of Argentina, paves way for $7.6 bln in funds.
• US Oct National Activity Index, 0.24, 0.17 previous, 0.14 revised.
• US Nov Dallas Fed Mfg Bus Index, 17.60, 29.40 previous.
• Oil breaks above $60/bbl, but doubts about growth curb gains.
• Ecuador to support OPEC oil production cut -energy minister.
Looking Ahead - Economic Data (GMT)
• 27 Nov 01:30 China Oct Sales Turnover, 4.10% previous
Looking Ahead - Events, Other Releases (GMT)
• 27 Nov N/A BoE Governor Mark Carney takes part in an online Q&A on the future of money in London
• 27 Nov 07:00 Deputy Governor & Executive Board of the Swedish central bank, Cecilia Skingsley, speaks at Centre for in Stockholm
• 27 Nov 09:30 BoE Executive Director for International Banks Supervision, Sarah Breeden participates in Climate Finance Day in Paris
• 27 Nov 10:00 Bank of Greece Governor Yannis Stournaras speaks at a conference in Athens
• 27 Nov 13:30 Fed Vice Chairman Richard Clarida speaks before The Clearing House 2018 Annual Conference in New York
• 27 Nov 13:45 Director for Banknotes and Chief Cashier of BoE, Victoria Cleland, gives a speech at Payments International, London
• 27 Nov 16:00 ECB board member Yves Mersch speaks in Frankfurt
• 27 Nov 19:30 Fed Chicago President Charles Evans, Fed Atlanta President Raphael Bostic and Fed Kansas City President Esther George participate in the Clearing House 2018 Annual Conference in New York
Currency Summaries
EUR/USD is likely to find support at 1.1300 levels and currently trading at 1.1325 levels. The pair has made session high at 1.1336 and hit lows at 1.1324 levels. The euro declined against US dollar on Monday, giving up earlier gains, after European Central Bank President Mario Draghi acknowledged slowing growth in the region.The euro zone has lost some growth momentum but this was mostly normal and not enough to derail plans by the bank to dial back stimulus further, Draghi and two of his top lieutenants said on Monday. The comments came after data showed that German business morale fell by more than expected in November. Munich-based Ifo said sentiment worsened for the third month in a row. The euro had gained earlier on Monday on signs that Italy may cut its budget deficit target to satisfy the European Union.Italy's governing coalition may reduce next year's budget deficit target to as low as 2 percent of gross domestic product to avoid disciplinary action from Brussels, two government sources said on Monday. Investors are focused this week on a speech on Wednesday by Federal Reserve Chairman Jerome Powell and minutes from the Fed’s Nov. 7-8 meeting to be released on Thursday, for further indications of how many more times the U.S. central bank is likely to hike interest rates.
GBP/USD is supported in the range of 1.2762 levels and currently trading at 1.2808 levels. It reached session high at 1.2851 and dropped to session low at 1.2801 levels. Britain's pound dipped against the dollar on Monday as investors were cautious whether Prime Minister Theresa May can get the agreement through a divided parliament. With European leaders endorsing on Sunday May's plan for future ties between Britain and the bloc, sterling traders are focused on a parliamentary vote on the deal likely to take place in mid-December.May is seeking to win over critics in her Conservative and opposition parties but the odds look stacked against her with criticism of the agreement approved in Brussels from all sides, including from the Northern Irish party propping up her minority government. Brexit negotiations and political uncertainty in Britain remain the key drivers for the pound, and many analysts are cautious about its prospects. Growing domestic opposition to May's Brexit arrangement has continued to pressure sterling, pulling it down 2.5 percent from a Nov. 7 high of $1.3176.
USD/CAD is likely to find support at 1.3180 levels and is trading at 1.3259 levels. It has made intraday high at 1.3249 and lows at 1.3194 levels. The Canadian dollar declined against its U.S. counterpart on Monday, as a rebound in oil prices was offset by news that General Motors Co would close its plant in Oshawa, Ontario, east of Toronto. Hundreds of workers walked off the job and Canadian Prime Minister Justin Trudeau expressed deep disappointment after the auto manufacturer's announcement caught governments and employees by surprise. Last week, Canada's government said it would allow businesses to write off additional capital investments to make them more competitive at a time when the United States is aggressively cutting taxes. Still, Ottawa did not announce measures that would help the country's energy sector, which has been hit hard by depressed oil prices.The price of oil clawed back on Monday some of the previous session's steep losses. U.S. crude oil futures settled 2.4 percent higher at $51.63 a barrel, while Wall Street rebounded as buyers returned in force after last week's sell-off. The Canadian dollar was last trading up at 1.3259 to the greenback.
USD/JPY is supported around 113.15 levels and currently trading at 113.58 levels. It peaked to hit session high at 113.61 and made session lows at 113.16 levels. The U.S. dollar strengthened against the yen on Monday as focus remained on clues on the U.S. Federal Reserve's 2019 hiking cycle and the high-stakes meeting between the leaders of China and the U.S. At a G20 meeting in Buenos Aires on Nov. 30, U.S. President A meeting between U.S. President Donald Trump and his Chinese counterpart, Xi Jinping, in Argentina this week is set to see if the world's biggest economies can de-escalate tensions over trade. U.S. President Donald Trump said on Monday he expects to move ahead with raising tariffs on $200 billion in Chinese imports to 25 percent from 10 percent currently. In an interview with the Wall Street Journal, Trump said it was "highly unlikely" he would accept China's request to hold off on the increase. Trump, who is due to meet with Chinese President Xi Jinping at the G20 summit in Buenos Aires this week, said if negotiations are unsuccessful he would also put tariffs on the rest of Chinese imports. The lack of progress would likely be very bearish for the currency pair.
Equities Recap
European shares closed higher on Monday after new-found optimism on Italy's budget tug-of-war with Brussels lifted shares in Milan while speculation about further mergers and acquisitions in telecoms boosted stocks in the sector.
UK's benchmark FTSE 100 closed up by 1.35 percent, the pan-European FTSEurofirst 300 ended the day down by 1.30 percent, Germany's Dax ended up by 1.6 percent, France’s CAC finished the day up by 1.1 percent.
Wall Street bounced back on Monday as bargain hunters returned in force after last week's sell-off and expectations of a flurry of holiday cyber-spending drove up shares of retailers.
Dow Jones closed up by 1.45 percent, S&P 500 ended up by 1.56 percent, Nasdaq finished the day up by 2.06 percent.
Commodities Recap
Gold firmed on Monday, supported by uncertainty over the future pace of U.S. interest rate hikes and the outcome of the G20 summit later this week when global leaders will focus on trade tensions.
Spot gold was steady at $1,222.42 per ounce at 1:30 p.m. EST (1830 GMT). U.S. gold futures settled down mostly unchanged at $1,222.40 per ounce.
Oil prices rose nearly 3 percent on Monday, clawing back some of last week's steep losses, although gains were capped by uncertainty over global economic growth and further signs of increasing supply, including record Saudi production.
Brent crude futures rose $1.68 to settle at $60.48 a barrel, a 2.9 percent gain. U.S. West Texas Intermediate (WTI) crude gained $1.21, or 2.4 percent, to close at $51.63 a barrel.
