Market Roundup
•French 12-Month BTF Auction -0.711%,-0.651% previous
•French 3-Month BTF Auction -0.782%,-0.772% previous
•French 6-Month BTF Auction -0.675%,-0.684% previous
•US Oct CB Employment Trends Index 112.23,110.35 previous
Looking Ahead Economic Data (GMT)
•23:40 Japan Oct Bank Lending (YoY) 0.6% previous
•23:40 Japan Sep Current Account n.s.a 1.060T forecast, 1.666T previous
•23:40 Japan Adjusted Current Account 1.04T previous
•05:30 Australia HIA New Home Sales (MoM) 2.3% previous
•05:30 Australia Oct NAB Business Survey 5 previous
•06:00 Australia NAB Business Confidence 13 previous
Looking Ahead - Events, Other Releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro strengthened against dollar on Monday as investors scaled back expectations for aggressive interest rate hikes from major central banks in the face of growing inflationary risks. European Central Bank chief economist Philip Lane told a Spanish newspaper that euro zone inflation will ease next year, becoming the latest ECB official to push back against market rate-hike bets. The euro was a touch higher, up 0.17% at $1.1588. Immediate resistance can be seen at 1.1576 (5DMA), an upside break can trigger rise towards 1.1594 (38.2%fib).On the downside, immediate support is seen at 1.1526 (23.6 % fib), a break below could take the pair towards 1.1502 (Lower BB).
GBP/USD: The pound rose on Monday off five-week lows touched last week against the dollar and euro, clawing back some of the hefty losses fuelled by the ebbing of interest rate bets. Markets are now pricing an interest rate rise at the Bank of England’s December meeting, but uncertainty remains high, after they were wrong-footed last week by policymakers who kept rates on hold at 0.1%. Prior to the BoE meeting, markets had priced two rate hikes by year-end. The pound firmed 0.6% against the weaker dollar at $1.3564, moving off the $1.3425 low hit on Friday. Immediate resistance can be seen at 1.3569 (38.2%fib), an upside break can trigger rise towards 1.3635(61.8%fib).On the downside, immediate support is seen at 1.3508(38.2%fib), a break below could take the pair towards 1.3430(23.6%fib).
USD/CAD: The Canadian dollar edged higher against its U.S. counterpart on Monday as weaker greenback and higher oil prices supported Canadian dollar. The dollar slipped on Monday as investors reassessed rate hike expectations and central banks' tolerance of inflation. Oil prices firmed as the passage of the U.S. infrastructure bill and China's export growth supported the outlook for energy demand, while Saudi Arabia's state-owned producer Aramco raised the official selling price for its crude. The Canadian dollar was last trading 0.01% higher at 1.2442 to the greenback. Immediate resistance can be seen at 1.2462(Higher BB), an upside break can trigger rise towards 1.2590 (50%fib).On the downside, immediate support is seen at 1.2439 (38.2%fib), a break below could take the pair towards 1.2389(21 DMA).
USD/JPY: The dollar declined against the Japanese yen on Monday as investors looked ahead to inflation data and monitored commentary from Federal Reserve officials for rate policy clues. U.S. Federal Reserve officials on Monday turned their focus toward interest rate policy with Fed Vice Chair Richard Clarida saying conditions for a rate hike could be met next year with job growth expected to continue and inflation already pushing beyond comfortable levels. The next test of the Fed's wait-and-see approach to inflation will be U.S. CPI data due on Wednesday. Strong resistance can be seen at 113.56(38.2%fib), an upside break can trigger rise towards 113.80(21DMA).On the downside, immediate support is seen at 113.14(50% fib), a break below could take the pair towards 112.70(61.8%fib).
Equities Recap
Strength in commodity-linked sectors helped European stocks inch up to a record high close on Monday, although broader gains were stifled by some weak earnings and a lack of any major market cues.
UK's benchmark FTSE 100 closed down by 0.05 percent, Germany's Dax ended down by 0.05 percent, France’s CAC finished the day up by 0.10 percent.
Wall Street stocks ended slightly higher on Monday, rising early after passage of a U.S. infrastructure spending bill but paring gains late as sliding Tesla shares weighed the indexes down.
Dow Jones closed up by 0.29% percent, S&P 500 closed up by 0.09 % percent, Nasdaq settled up by 0.07% percent.
Treasuries Recap
Traders sent most U.S. Treasury yields higher on Monday after Congress passed a $1 trillion infrastructure bill and demand was soft for three-year notes at auction.
The benchmark 10-year yield was up 4.5 basis points at 1.4984%.The two-year U.S. Treasury yield, was up 4.2 basis points at 0.4466%.
Commodities Recap
Oil prices rose on Monday as positive signs for global economic growth supported the outlook for energy demand and the United States said it was weighing options to address high prices.
Brent crude was up 71cents, or 0.83%, at $83.44 a barrel by 2:28 p.m. (1828 GMT), having lost nearly 2% last week. U.S. oil gained 68, or 0.84%, to $81.95 after a 3% fall last week. Both contracts rose by more than $1 a barrel in early trade.
Gold rose to a two-month high on Monday, bolstered by a retreat in the dollar and persistent inflation concerns after key central banks indicated interest rates would remain low in the near term.
Spot gold was up for the third straight session, rising 0.5% to $1,825.64 per ounce by 1:40 p.m. ET (1740 GMT), the highest since Sept. 7. U.S. gold futures settled 0.6% higher at $1,828.
