MARKET REPORT
America is now unburdened by what has been
Chicago Stock Exchange
You were found in clear conditions. But you’re handsome in the fog.
“Voters seem to forget when politicians ‘give’ you money, it is the voters’ money they have already taken.”
Day in Review:
Today:
DATA:
– CPI:
– For the 53rd straight month, core consumer prices rose on a MoM basis in October with the YoY pace re-accelerating to +3.33%
The headline CPI rose 0.2% MoM (as expected) which reaccelerated the YoY rise to +2.6% (as expected)
– Housing costs accelerate
– US Oct Budget Deficit jumps to $257B
COMPANIES
– NVDA and SoftBank team up on world’s first AI/5G telecom network.
– Rivian surges (+14%) announced an expansion of its deal with Volkswagon (-3%)
– Boeing (-3.5%) starts planned 17k layoff’s.
– Musk’s X hires Banki as CFO
– Amazon (+2.4%)launches online storefront (to compete with Shein, Temu)
GENERAL:
– Republicans will maintain control of the House of Reps Giving them control in both houses and the Presidency.
– John Thune (RINO, ‘Never-Trumper’) R-SD elected Senate Majority leader to assume post McConnell
– Bronze Star Recipient, Fox News Host Pete Hegseth For SecDef
– Elon Musk & Vivek Ramaswamy to head newly created Department of Government Efficiency.
– Tulsi Gabbard for Director of National Intelligence
– Florida Congressmen Matt Gaetz tapped for US Attorney General
– John Radcliff to head CIA (Texas Rep)
– Fed’s Logan says rise in bond yields partly reflects the rise in term premiums
– Fed’s Musalem says stronger data is likely behind the rise in treasury bonds term premia
– Fed’s Kashkari notes today’s headline inflation, seems to be confirming the path the Fed is on
– Israeli Officials say Iran has withdrawn a response due to Trump election
– CIA Official Arrested Abroad For Leaking Secret Documents On Israeli Military Plans
– SP & ND hit record highs in afternoon trading
– The odds for another 25bps reduction in the fed funds rate in December increased to about 82%, compared to nearly 60% before the CPI release
– AUDUSD decreased to a 13-week low of 0.65. Over the past 4 weeks, Australian Dollar US Dollar lost 3.13%, and in the last 12 months, it increased 0.12%
– CADUSD at May 2020 lows
– DXY increased to a 12-month high of 106.52. Over the past 4 weeks, Dollar Index gained 3.21%, and in the last 12 months, it increased 2.35%
– US Nat Gas futures (+3%) hit 5-month high on colder weather forecasts
– World oil demand outlook relatively unchanged in EIA STEO, output is seen rising
– Equities mixed, Treasuries steepen, Crude up, Dollar up
Ahead:
– Australian Jobs, EU Jobs, GDP, US Initial Jobless Claims, US PPI (Final), NZ Manufacturing PMI, Japanese GDP QQ
Speakers:
– ECB’s Lagarde, de Guindos, Schnabel; Fed’s Powell, Barkin, Williams, Kugler; BoE’s Bailey, Mann
Earnings:
Siemens, Talanx, Deutsche Telekom, Merck, Swiss Re, Swiss Life, Burberry, B&M European, Disney, Brookfield, Applied Materials, JD.Com, Advanced Auto Parts.
MAJORS:
DX:
– The dollar initially saw weakness upon the October CPI report which saw all metrics in line with expectations, with the DXY troughing at 105.71. Fed pricing saw odds of a December 25bps rate cut rise to 85% from 60% pre-data. Regardless, dollar strength picked up at the US cash open as a continuation of a trump trade seems to offer recent data implications.
The day saw a series of remarks from Fed members. Fed’s Logan (2026 Voter) said it is difficult to know how many rate cuts may be needed and how soon they need to happen, and the rise in bond yields in part reflects a rise in term premiums. “If the rise continues, Fed may need less restrictive policy”.
On the inflation report, said the headline level seems to be confirming the path the Fed is on, “thinks inflation is heading in the right direction and have confidence on that”.
The latest US Federal Budget surged to a deficit of USD 257bln (prev. surplus of USD 64bln), driven by one-off factors and calendar adjustments in benefit payments, where excluding these components, left the budget at a deficit of USD 47bln.
With the DXY setting a fresh YTD high of 106.53, 2023’s high of 107.34 lies ahead as a key level to test, as another set of Fed members are to give remarks on Thursday with PPI (Oct) in the background.
EQUITIES:
EUR:
– DAX: -0.30% at 18,977, FTSE 100: +0.06% at 8,030, CAC 40: -0.14% at 7,217, Euro Stoxx 50: -0.10% at 4,740
US:
– SPX +0.02% at 5,985, NDX -0.16% at 21,036, DJIA +0.11% at 43,958, RUT -0.94% at 2,369
Sectors:
– Communication Services -0.57%, Technology -0.31%, Health -0.3%, Utilities -0.24%, Financials +0.06%, Materials +0.2%, Industrials +0.21%, Consumer Staples +0.28%, Real Estate +0.73%, Energy +0.84%, Consumer Discretionary +1.14%
OIL:
– WTI (Z4) SETTLED USD 0.31 HIGHER AT 68.43/BBL; BRENT (F5) SETTLED USD 0.39 HIGHER AT USD 72.28/BBL
The crude complex was choppy on Wednesday, as conflicting Middle East reports sparked oil to lows, and then later highs. In the European morning oil saw some weakness following Iranian sources via Sky News Arabia that Iran postpones the implementation of the “Operation Honest Promise 3” operation against Israel after Trump’s victory. WTI and Brent trundled to session lows of USD 66.94/bbl and 70.72/bbl, respectively, before rebounding to highs later in the session after Israel’s defence Minister Katz stated no ceasefire and no arrangement in Lebanon that does not include Israel’s right to enforce and act on its own against Hezbollah.
Elsewhere, the monthly EIA STEO saw 2024 world crude oil output marginally lift to 102.6mln BPD (prev. 102.5mln), with 2025 output seen at 104.7mln BPD (prev. 104.5mln). 2024 world oil demand seen at 103.1mln BPD (prev. 103.1mln BPD), and 2025 demand of 104.4mln BPD (prev. 104.3mln).
Ahead, the weekly private inventory data is after-hours, which has been delayed by a day on account of Veteran’s Day on Monday. Current expectations are (bbls): Crude (exp. +0.1mln), Gasoline (exp. +0.6mln), Distillate (exp. 0.2mln).
GOLD/SILVER:
– Broke through $2600 support today
– continued decline and weekly chart close below the 18 September low at $2,546.86 could lead to a deeper correction
– 2 month low today
BONDS:
YIELD CHANGE
US 1-MO: 4.58 -0.018
US 6-MO: 4.438 -0.032
US 1-YR: 4.304 -0.076
US 5-YR: 4.298 -0.017
US 10-YR: 4.451 +0.018
US 30-YR: 4.641 +0.064
TWO’s/TENS: 0.18 +0.09
KEEP DOING WHATS WORKING, STOP WHAT ISNT
Best of luck out there.
Let the market come to you
Post of the day:
https://www.youtube.com/watch?v=oFZnzve8K9s
https://www.youtube.com/shorts/PVHTLdKAm3Y
Song of the day:
https://www.youtube.com/watch?v=wP8A9rtg0iI
Fure Ow Scootish readerz.
https://en.wikipedia.org/wiki/Caledonia
Joke of the Day:
https://www.youtube.com/watch?v=_MQpUuTY7DE
House of the day:
https://www.youtube.com/watch?v=e88mvrxSnf0
(Seize all assets of Duke and Duke enterprises)
I can be contacted should anyone have any questions, input at [email protected] during US hours of EST 9am until 5pm
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