Market Roundup
• Fed's Daly wants gradual rate hikes, says Fed not on autopilot.
• U.S. crude weakens after Trump calls on OPEC to keep output.
• Saudi's Falih says analysis shows need for 1 mln bpd cut in oil output.
• UK PM May stares into Brexit abyss as domestic opposition mounts.
• ECB reinvestments should be flexible, "not too long": Lautenschlaeger.
• China calls for open world economy but work remains on landmark trade pact.
• Germany's Scholz sees Italy taking steps to resolve budget row.
• Italy's budget tussle raises debt concerns: ECB's de Guindos.
• India's central bank governor met PM, RBI may review lending curbs – media.
Looking Ahead - Economic Data (GMT)
• 12 Nov 21:45 New Zealand Oct Food Price Index, -0.1% previous
• 13 Nov 00:30 Australia Oct NAB Business Conditions, 15 previous
• 13 Nov 00:30 Australia Oct NAB Business Confidence, 6 previous
Looking Ahead - Events, Other Releases (GMT)
• 12 Nov 22:30 Reserve Bank of New Zealand's Geoff Bascand speaks on "Financial stability - not too risky, not too safe, but just right?" in Wellington
• 13 Nov 08:00 ECB's Peter Praet speaks at conference in London
• 13 Nov 08:45 ECB's Sabine Lautenschlager speaks on "Banking Supervision, Resolution and Risk Management in Europe" in Frankfurt
• 13 Nov 13:00 Norway Central Bank's Jon Nicolaisen speaks at "Adam Smith and Economic Development" in Paris
• 13 Nov 15:00 Fed Minneapolis's Neel Kashkari moderates Q&A session at 2018 Regional Economics Conference in Minneapolis
• 13 Nov 15:00 Fed's Lael Brainard speaks on "Artificial Intelligence and the New Financial Landscape" in Philadelphia
• 13 Nov 17:00 Riksbank's Per Jansson visits Linköping as part of the bank's 350th anniversary in Linkoping, Sweden
• 13 Nov 17:30 Bank of Greece governor Yannis Stournaras speaks on lessons from the crisis and challenges for Greek banking sector in Geneva
• 13 Nov 19:20 Fed Philadelphia's Patrick Harker participates at "Fintech and the New Financial Landscape" in Philadelphia
• 13 Nov N/A Riksbank's Henry Ohlsson discusses current monetary policy and the economic situation in Sundsvall, Sweden
Currency Summaries
EUR/USD is likely to find support at 1.1200 levels and currently trading at 1.1224 levels. The pair has made session high at 1.1278 and hit lows at 1.1222 levels. The euro slipped lower against the U.S. dollar on Monday bets on a Federal Reserve interest rate increase next month, and political risks in Europe which put pressure on the euro. Fears about a no-deal Brexit and a growing rift in Europe over Italy's budget have also boosted the dollar. The greenback has rebounded from losses tied to the view that U.S. elections last Tuesday, which produced a split control of Congress, would reduce chances of more fiscal stimulus measures. The dollar's bounce has been underpinned by the Fed's signal that it would hike key lending rates further as U.S. economic expansion remains on track. an index that tracks the dollar against the euro, yen, sterling and three other currencies was up 0.44 percent at 97.331. It reached 97.578 earlier Monday, which was the highest since June 2017. U.S. trading was muted by the U.S. Veterans Day holiday. While Wall Street and currency markets were open for business, the U.S. bond market was closed.
GBP/USD is supported in the range of 1.2764 levels and currently trading at 1.2852 levels. It reached session high at 1.2934 and dropped to session low at 1.2820 levels. Britain's pound held near 10-month low against the dollar on Monday as stronger greenback and reduced expectations of a Brexit deal fuelled a selloff. In volatile trading, sterling fell to a 1-1/2 week low of $1.2827 as negative headlines over the last 48 hours punctured growing optimism last week that an agreement between Britain and the European Commission was imminent. It later rose about half a percent from the day's low on a Financial Times report citing the European Union's Brexit negotiator Michel Barnier as saying the main elements of a deal were ready. May's Brexit strategy has come under attack from all sides, increasing the risk that her plan for leaving the EU will be voted down by parliament and thrust the United Kingdom towards a potentially chaotic "no-deal" Brexit. The latest setback for sterling comes in a busy week for economic data with wages, inflation and retail sales figures all due even as policymakers have struck a confident outlook on the UK economy.
USD/CAD is supported at 1.3171 levels and is trading at 1.3243 levels. It has made session high at 1.3228 and lows at 1.3191 levels. The Canadian dollar declined against its U.S. counterpart on Monday as concern about political risks in Europe and stronger dollar weighed on Canadian dollar. The U.S. dollar rallied to a more than 16-month high on Monday as investors positioned for a Federal Reserve interest rate rise next month.In Europe, fears about a no-deal Brexit and a growing rift over Italy's budget put pressure on the euro and the pound. The price of oil, one of Canada's major exports, rose by about 1 percent on Monday, set for its largest one-day increase in about a month after Saudi Arabia said OPEC and its partners believed demand was softening enough to warrant an output cut of 1 million barrels per day. Saudi Arabia, the world's largest oil exporter, said on Sunday it would cut its shipments by half a million barrels per day in December due to seasonal lower demand. The Canadian dollar was last trading against the greenback, the currency hit its weakest level since July 20 at 1.3236.
AUD/USD is supported around 0.7197 levels and currently trading at 0.7190 levels. It hit session high at 0.7215 and made session lows at 0.7185 levels. The Australian dollar eased against dollar on Monday as concerns about global growth resurfaced, weighing on risk-sensitive assets including equities. The Aussie was also dragged down by a broadly stronger U.S. dollar after the Federal Reserve last week reaffirmed its plans to raise interest rates in December and beyond. A run of disappointing data from China recently including falling producer inflation amid cooling domestic demand have hurt risk sentiment. Asian shares started the week in negative territory after a sell-off in Wall Street on Friday. A heated Sino-U.S. trade war is at the centre of investor focus with the leaders of the two countries set to meet later this month. Markets will also look out for any headlines from an Asia-Pacific leaders meeting in Singapore this week, which U.S. President Donald Trump has decided to skip. The Reserve Bank of Australia (RBA) has kept rates at a record low 1.50 percent for more than two years now and has reiterated the need for policy to remain accommodative amid tepid inflation and spare labour market capacity.
Equities Recap
European shares were lower on Monday led by a sell-off in technology stocks after earnings and M&A news from German heavyweights Infineon and SAP, and tobacco was hit by new signs of U.S. regulators tightening the screws on menthol cigarettes.
UK's benchmark FTSE 100 closed up by 0.65 percent, the pan-European FTSEurofirst 300 ended the day down by 0.82 percent, Germany's Dax ended dosn by 1.79 percent, France’s CAC finished the day down by 0.93 percent.
Wall Street's major indexes fell on Monday, with the S&P 500 weighed by technology and financial stocks as shares of Apple Inc and Goldman Sachs Group Inc came under pressure.
Dow Jones closed down by 2.31 percent, S&P 500 ended down by 1.96 percent, Nasdaq finished the day down by 2.82 percent.
Commodities Recap
Gold slid to its lowest level in a month on Monday as the dollar rose to 16-month highs, boosted by the U.S. Federal Reserve's hawkish interest rate policy and political uncertainty in Europe.
Spot gold fell 0.5 percent to $1,203.30 per ounce at 13:34 p.m EST (1844 GMT), having touched a one-month low of $1,201.85 earlier in the session.U.S. gold futures settled down $5.1, or 0.4 percent, at $1,203.50.
U.S. crude prices turned negative as U.S. President Donald Trump said he hoped there would be no oil output reductions, after Saudi Arabia said OPEC was considering cutting supply next year, citing softening demand.
U.S. benchmark West Texas Intermediate crude fell 18 cents a barrel to trade at $60.01 a barrel by 2:24 p.m. EST (1724 GMT). If the decline holds, the contract is on track for its eleventh consecutive daily loss, the most on record since trading on the contract began in 1983.
Following four sessions of losses, Brent crude futures crude was up 16 cents at $70.34 a barrel, paring gains after trading as high as $71.88.
