MARKET REPORT
Review:
– Dollar up SMALLS. Dollar up 0.1% vs AUD, 0.2% vs EUR, Unch vs Pound and down 0.1% vs Yen. Dow/ES up 0.4%, ND Unch. Crude up 1.5%, Gold and Silver consolidate levels. Coins rest with BTC -0.5%, ETH -1.25%, Treasuries up.
– Fed Barkin hawkish: he is not willing to take another rate hike off the table, warning: still looking to be convinced on inflation.
– Fed Bostic dovish: downward trajectory of inflation will likely continue, economic activity will slow in the coming months, tighter policy is biting harder into economic activity.
– Fed Mester dovish: repeated monetary policy is in a good place, Fed has time to vet incoming data. Fed well positioned to be flexible, must be nimble in current circumstances. See’s clear progress in lowering inflation.
– US Q3 GDP revised higher
Upcoming:
Australian; Building Approvals & Australian PMI (Final), Chinese NBS PMI, Japanese; Consumer Confidence Index & Unemployment, German; Trade/Retail Sales & Unemployment, EZ CPI, US; Personal Consumption, PCE Price Index, Canadian GDP, OPEC+ Meeting
Speakers: BoJ’s Nakamura; Fed’s Williams; BoE’s Greene; ECB’s Lagarde.
MAJORS:
DX:
Early bid tone on Barkin was tempered by a dovish Bostic and a mixed bag from usually hawkish Mester. 102.90 faded to 102.60 before we close around 102.75, +11 pips/0.1%. Market will be watching US PCE, ISM & Powell this week for further hints at monetary policy direction. I hate to pick a temp bottom but the Index may rest here with side to side trading as the Fed sends out mixed bag of signals and will require data for clarity. Cant see us for the short term breaking 102. 102-104 near term. Rangey.
AUD:
Aussie ground off from 66.40 to 66.10 in a relatively quiet session. The battler did regain ground in the afternoon hitting 66.35 and drifting off to close 66.25. Again feel we’re rangey 65-67 for foreseeable. Trade accordingly.
EUR:
We’ve been washing around the 91 handle as I called the last two reports. 90.85 had its predicted squeeze back to 91.20 (I called 91.30) for a retest and a wash around the handle closing at 91.15.
As above believe the USDEUR will rest from its decline from its Oct 1st highs of 95 cents. Don’t expect a break of 91 to hold with movements sub/around 90.80 value for a turn. Look for the turn. We may see a re-test of 92. 90.85 to 91.95 near term.
Pound
Chopping trading had early short squeeze seeing 127.30 before failing below the figure. As above I wouldn’t be surprised to see a rest up here. Id be looking at fading strength 127.20 for a look back at 126.
Gold and Silver:
Precious Metals consolidated with Gold (GC) +$5 at 2065 and Silver (SI) above the $25 handle at $25.43. Like the dollar metals are waiting on Fed IR chatter but appear more confident of dovish Fed moves than the Currency.
US Equities:
Dow: +0.4%, ES up 0.4%, ND Unch
Real Estate +0.73%, Financials +0.71%, Materials +0.38%, Industrials +0.33%, Health +0.02%, Technology +0.01%, Consumer Discretionary -0.35%, Utilities -0.79%, Consumer Staples -0.81%, Energy -0.88%, Communication Services -1.12%.
GM soared 9.4% after the automaker announced a $10 billion share buyback program and raised its dividend 33% to USD 0.12/shr starting in 2024. Gamestop surged 20.5% ahead of its earnings next week. Crowdstrike jumped 10.4% after upbeat earnings results. Rover agreed to be acquired by Blackstone for USD 11/shr in cash or USD 2.3bln; the transaction is currently expected to close in Q1 ’24. ROVR closed Tuesday at USD 8.50/shr. Disney (DIS) CEO Iger said linear network TV is not for sale and he will definitely step down at the end of 2026.
Oil:
Crude was choppy but settled firmer, closing at highs after further OPEC+ source reports continued to highlight that Saudi Arabi want deeper production cuts. The black gold fell like a stone from $77.75 to $75.75 before almost immediately recovering to close $77.72 +1.71%/+$1.31 In a truly whip-saw session.
Bond Yields:
1 Mo: 5.389 -0.005 6Mo 5.405 -0.038 1yr 5.115 -0.085 5yr 4.214 -0.072 10yr 4.259 -0.077 and the 30yr 4.443 -0.081
2’s/10’s -0.39
Crytpo:
Coins had a rest today with BTC retracing 150 points to 37850 and ETH 25 points at 2030. I like anything with a 36 handle in BTH and sub 2k ETH. Doubt we’ll see them so jump on strength. Still think 40k and 2250 on cards.
Best of luck out there.
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