Market Roundup
•Canada Oct Housing Starts 267.1K,270.0K forecast, 299.6K previous
•Canada Oct Core CPI (MoM) 0.4%, 0.4% previous
•Canada Oct Core CPI (YoY) 5.8%,6.0% previous
•US Oct Core Retail Sales (MoM) 1.3%, 0.4% forecast,0.1% previous
•US Oct Retail Sales (MoM) 1.3%,1.0%forecast,0.0% previous
•US Oct Export Price Index (MoM) -0.3%, -0.4% forecast,-0.8% previous
•US Oct Retail Sales Ex Gas/Autos (MoM) 0.9%,0.2% forecast, 0.3% previous
•Canada Oct CPI (MoM) 0.7%,0.7% forecast, 0.1% previous
•US Oct Import Price Index (MoM) -0.2%, -0.4% forecast,-1.2% previous
•US Oct Retail Sales (YoY) 8.37%,8.51%previous
•Canada Median CPI (YoY) 6.2% ,4.8% forecast,4.7% previous
•Canada Common CPI (YoY) 6.2%,5.9% forecast, 6.0% previous
•US Export Price Index (YoY) 6.9%,9.5% previous
•US Import Price Index (YoY) 4.2%,6.0% previous
•US Oct Industrial Production (YoY) 3.28% 5.33% previous
•US Oct Manufacturing Production (MoM) 0.1%,0.2%forecast,0.4% previous
•US Oct Industrial Production (MoM) -0.1%,0.2% forecast, 0.4% previous
•US Sep Retail Inventories Ex Auto -0.1%,-0.1%forecast, 0.6% previous
•US Sep Business Inventories (MoM) 0.4%,0.5% forecast, 0.8% previous
•US Nov NAHB Housing Market Index 33, 36 forecast, 38 previous
• US Crude Oil Inventories-5.400M, -0.440M forecast, 3.925M previous
Looking Ahead - Economic Data (GMT )
•23:30 Japan Oct Trade Balance -1,610.0B forecast, -2,094.3B previous
•23:30 Japan Oct Exports (YoY) 28.1% forecast, 28.9% previous
•23:30 Japan Adjusted Trade Balance -2.23T forecast, -2.01T previous
•00:30 Australia Oct Unemployment Rate 3.6% forecast, 3.5% previous
•00:30 Australia Oct Employment Change 15.0K forecast, 0.9Kprevious
•00:30 Australia Oct Participation Rate 66.6% forecast, 66.6%previous
Looking Ahead - Events, Other Releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro rose against dollar on Wednesday as signs of cooling U.S. inflation boosted bets for smaller rate hikes weakened dollar, while reports around Russian missiles killing two people in Poland kept investors cautious. The U.S. producer price index (PPI) increased 8.0% for the 12 months through October compared with economist expectations for 8.3% and September’s 8.4% increase, according to the Labor Department data. The data, following last week’s smaller-than-expected increase in consumer prices for October, encouraged investors who have been closely monitoring inflation data for signs that the Federal Reserve could slow its interest rate hikes. The euro was last 0.47% higher at $1.0412. It was heading back towards the four-and-a-half month high of $1.0481 Immediate resistance can be seen at 1.0434(23.6%fib), an upside break can trigger rise towards 1.0500(Psychological level).On the downside, immediate support is seen at 1.0311 (38.2%fib), a break below could take the pair towards 1.0261(5DMA).
GBP/USD: Sterling strengthened against the U.S. dollar on Wednesday following UK inflation data that topped expectations and raised the chances of yet more interest rate hikes by the Bank of England (BoE). Surging household food and energy bills pushed British inflation for October to 11.1%.In response to the data, finance minister Jeremy Hunt, who is set to unveil a series of tax hikes and spending cuts on Thursday, said “tough but necessary” decisions were required to tackle rising prices.Hunt’s plan is the first budget since former Prime Minister Liz Truss’s September “mini-budget” prompted UK bonds to plunge and borrowing costs to soar. Immediate resistance can be seen at 1.1952 (23.6%fib), an upside break can trigger rise towards 1.2036 (Nov 16th high).On the downside, immediate support is seen at 1.1806(5DMA), a break below could take the pair towards 1.1661(38.2%fib).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Wednesday as investors took stock of recent gains and domestic inflation data left the door open to a smaller interest rate hike by the Bank of Canada at a policy decision next month. Canada’s annual inflation rate held steady at 6.9% in October, matching analyst forecasts, while core inflation measures were mixed, Statistics Canada data showed. The price of oil, one of Canada’s major exports, fell as geopolitical tensions were offset by concerns over rising COVID-19 cases in China. The loonie was trading 0.3% lower at 1.3330 to the greenback, or 75.02 U.S. cents, after moving in a range of 1.3229 to 1.3347. Immediate resistance can be seen at 1.3276 (50%fib), an upside break can trigger rise towards 1.3404(5 DMA).On the downside, immediate support is seen at 1.3211(38.2%fib), a break below could take the pair towards 1.3133(Lower BB).
USD/JPY: The dollar edged higher against the yen on Wednesday as stronger-than-expected U.S. retail sales data boosted dollar.U.S. retail sales increased more than expected in October as households stepped up purchases of motor vehicles and a range of other goods, suggesting consumer spending picked up early in the fourth quarter, which could help to support the economy. Retail sales rose 1.3% last month after being unchanged in September. Economists polled had forecast sales would rise 1.0%. Sales increased 8.3% on a year-on-year basis in October.Strong resistance can be seen at 139.64(5DMA), an upside break can trigger rise towards 140.68(50%fib).On the downside, immediate support is seen at 137.72(23.6%fib), a break below could take the pair towards 136.98(Lower BB).
Equities Recap
Europe's STOXX 600 index snapped a four-day winning streak on Wednesday, led by losses in shares of Mercedes Benz Group, while a dour forecast from U.S. big box retailer Target Corp pressured regional retailers on concerns about consumer spending..
The UK's benchmark FTSE 100 closed down by 0.25 percent, Germany's Dax ended up by 1.00 percent, and France’s CAC finished the down by 0.52 percent.
Wall Street's main indexes ended lower on Wednesday as a grim outlook from Target spurred fresh concerns about retailers heading into the crucial holiday season, while semiconductor shares slid after Micron's supply cut.
Dow Jones closed down by 0.12%percent, S&P 500 ended down 0.83 percent, Nasdaq finished the day down by 1.54 percent.
Treasuries Recap
Long-dated U.S. Treasury yields fell on Wednesday and the inversion in key parts of the yield curve deepened after a strong retail sales report boosted expectations that the Federal Reserve will continue hiking rates, which in turn is more likely to hurt economic growth.
Two-year Treasury yields , which are the most sensitive to Fed rate policy, rose as high as 4.401% after the retail sales release, before falling back to 4.363%, little changed on the day.
Benchmark 10-year yields dipped 10 basis points to 3.694%, the lowest since Oct. 5, after a brief initial pop after the data.
Commodities Recap
Gold hovered near its three-month peak on Wednesday, weighed by a slightly stronger dollar while benchmark yields were lower, as the market focus shifted from global tensions to the Federal Reserve’s interest rate strategy.
Spot gold edged 0.3% lower to $1,773.13 per ounce by 2:08 p.m. ET (1908 GMT), while U.S. gold futures settled down around 0.1% to $1,775.8.
Oil prices settled more than a dollar lower on Wednesday after Russian oil shipments via the Druzhba pipeline to Hungary restarted and as rising COVID-19 cases in China weighed on sentiment.
Brent crude futures settled a dollar lower at $92.86 a barrel, down 1.1%. U.S. West Texas Intermediate (WTI) crude futures slid by $1.33, or 1.5%, to settle at $85.59 a barrel. as Druzhba pipeline reopens
