Market Roundup
- U.S. jobless claims (271k), continuing claims (2.175m) decline.
- Philly Fed Nov business conditions index +1.9 vs consensus -1.0 and -4.5 in Oct.
- Fed's Mester: interest rate path more important than liftoff.
- Atlanta Fed's Lockhart: gradual means no hike at every meeting.
- ECB minutes: downward revision of inflation outlook potentially worrisome, disappointed w/speed of structural reforms.
- China's Premier Li says economy moving in reasonable range, will actively promote structural reforms, and strive to realize economy's healthy LT development.
- China's yuan may enter IMF basket with lower share.
- Mexico changes terms of daily dollar auctions, suspends auction w/no min bid increase auction w/min bid.
- Base metals plumb multi-year lows as China worries persist; supply cuts needed - analysts.
- Rising dollar tops Goldman Sachs' 2016 trade tips, likes USD long vs EUR & JPY.
Looking Ahead - Economic Data (GMT)
- No Significant Data
Looking Ahead - Events, Other Releases (GMT)
- 22:40 Australia RBA's head of economic analysis, Alex Heath, at a Resources and Energy Workshop
Currency Summaries
EUR/USD is likely to find support at 1.0665 levels and currently trading at 1.0732 levels. The pair has made session high at 1.0763 and hit lows at 1.0667 levels. The dollar slipped lower against euro on Thursday, as traders booked profits on speculation that a U.S. Federal Reserve will raise interest rate increase next month. The minutes of the latest Federal Reserve meeting released on Wednesday reinforced the rate hike view, providing broad, long-term support for the dollar. However, some analysts opined that the minutes also showed a debate among the Fed members of the monetary policy committee about the U.S. economic outlook, which may have affected sentiment about an impending rate hike in December. That could partly explain why the dollar weakened despite a generally upbeat view on the U.S. economy. The currency's strongest level of the session was $1.0760, while its weakest level was $1.0716. To the upside, immediate resistance can be seen at 1.0750. To the downside, immediate support level is located at 1.0705 levels.
GBP/USD is supported in the range of 1.5244 and currently trading at 1.5287 levels. It reached session high at 1.5334 and hit low at 1.5286 levels. Sterling edged slightly lower against dollar on Thursday, as weak British retail sales weighted down on the sterling which underpinned the hopes that UK interest rate is going to rise anytime soon. The outlook for British manufacturers darkened on Thursday as a survey showed they expect their output to fall, the first such prediction in three years, while official data marked a slight decline in retail sales in October. While retail sales volumes slipped to 0.6 percent on the month, the decline was mostly expected and followed a surge in September boosted by sales during the Rugby World Cup. Retail sales volumes were affected by the biggest drop in food store sales since May 2014, even though they were still 3.8 percent higher than a year ago and printed solid growth of 0.9 percent in the 3- months to October. To the upside, immediate resistance can be seen at 1.5291. To the downside, immediate support level is located at 1.5247 levels.
USD/JPY is supported around 122.64 levels and currently trading at 122.87 levels. It to hit session high at 122.90 and made session lows at 122.64 levels. The US dollar slipped sharply lower against Japanese Yen on Thursday but trimmed some losses after the release of jobless claims data and Philadelphia manufacturing index. Initial claims for state unemployment benefits slipped 5,000 to a seasonally adjusted 271,000 for the week ended Nov. 14, the Labor Department said. Claims have now held below the 300,000 mark for 37 consecutive weeks, the longest stretch in years, and are not too far from levels last seen in the early 1970s. The four-week moving average of claims, considered a better measure of labor market trends as it strips out week-to-week volatility, rose 3,000 to 270,750 last week. On the other hand the Philadelphia manufacturing index showed it rose to 1.9 this month from -4.5 in October. It was the first positive reading in three months for the regional survey. The report came on the heels of data on Tuesday showing a healthy increase in U.S. manufacturing output in October. In late morning trading, the dollar fell 0.7 percent against the yen to trade around 122.82. To the upside, immediate resistance can be seen at 123. the downside, immediate support level is located at 122.73 levels.
USD/CAD is supported at 1.3244 levels and is trading at 1.3296 levels. It has made session high at 1.3368 and lows at 1.3318 levels. The Canadian dollar firmed against U.S. dollar, but trimmed some gains as crude oil prices fell after earlier advancing and Canadian wholesale trade dipped unexpectedly in September. On the data front, Canadian wholesale trade unexpectedly fell by 0.1 percent in September from August, led by the motor vehicle and building supplies sectors, data from Statistics Canada showed on Thursday. The slump in September followed August's upward revision to no change and July's decline of 0.1 percent. In volume terms, September sales fell by 0.4 percent. The currency's strongest level of the session was C$1.3247, while its weakest was C$1. the market will also be bracing for October CPI and September retail sales data, due to be released on Friday. To the upside, immediate resistance can be seen at 1.3300. To the downside, immediate support level is located at 1.3266 levels.
Equities Recap
European shares touched three-month highs on Thursday, helped by food and facilities group Sodexo rallying after a solid update and a share buyback announcement.
UK's benchmark FTSE 100 closed up by 0.9 percent, the pan-European FTSEurofirst 300 ended the day up by 0.45 percent, Germany's Dax ended up by 1.2 percent, France's CAC finished the day up by 0.3 percent.
Wall Street wobbled on Thursday as healthcare stocks ended a three-day rally after UnitedHealth cut its profit forecast, offsetting gains in Intel and other technology stocks.
Dow Jones closed down by 0.02 percent, S&P 500 ended down by 0.12 percent, Nasdaq finished the day down by 0.04 percent.
Treasuries Recap
Longer dated US Treasuries performed better than short dated Treasuries as the for the second straight session on Thursday as a drop jobless claims supported the view that Federal Reserve will hike interest rate in December.
The 30- year bond was up 22/32 in price to yield 3.005 percent, down about 4 basis points from late on Wednesday, and the five year note was up 1/32 in price to yield 1.671 percent, down 0.5point on the day.
Benchmark 10-year Treasuries were up 6/32 in price for a yield of 2.246 percent, down 2 basis points.
Commodities Recap
Gold rose 1 percent on Thursday, rebounding from near six-year lows as the US Jobless claims data came positive and investors focus returned to expectations for the U.S. Federal Reserve to raise interest rates in December.
Spot gold was up 1 percent at $1,081.01 an ounce at 2:51 p.m. EST (1951 GMT), after rising as much as 1.5 percent to $1,086.10. The metal hit its weakest since February 2010 on Wednesday at $1,064.85.
U.S. gold futures for December delivery settled up 0.9 percent at $1,077.90.
Brent oil futures settled steady on Thursday while U.S. crude fell ahead of the expiry of the front-month contract and continued pressure from large inventory builds.
Brent futures settled up 4 cents at $44.18 a barrel, after hitting a low of $43.70 earlier in the session.
U.S. crude's West Texas Intermediate (WTI) futures settled down 21 cents at $40.54. It had earlier snapped below the key $40-a-barrel support for a second time since Wednesday.
