Market Roundup
- US jobless claims rise (+1k) in latest week, 4-wk avg falls (-4k) lowest since 1973.
- US Q3 GDP rises 1.5 pct vs 3.9% rise in Q2.
- US Sept pending home sales fall 2.3 pct vs +1% forecast, Northeast & south lead way lower.
- Dollar continues slide after brief bump, on GDP numbers.
- U.S. bond prices tumble on GDP data, corporate supply; US 10-yr off 8bp at 2.17%.
- ECB's Constancio: Capping banks' govt bond holdings could open huge capital hole.
- ECB's Liikanen: Factors weighing on inflation warrant thorough analysis China Communist Party says targeting medium to high economic growth for next 5 years.
- UK CBI October retail sales balance hits six-month low drops to +19 from +49.
- Moody's: High-yield issuance in Latin America hits record low.
- Brazil's Tombini says opposes use of dollar reserves now, Lula backs austerity, BRL rallies.
- Ryan wins 236 Republican votes to be elected U.S. House speaker.
Looking Ahead - Economic Data (GMT)
- 21:45 New Zealand Building Consents Sep-4.9%-previous
- 23:30 Japan All Household Spending YY* Sep forecast 1.2%, 2.9%-previous
- 23:30 Japan All Household Spending MM* Sep forecast 0.3%, 2.5%-previous
- 23:30 Japan CPI, Core Nationwide YY Sep forecast -0.2%, -0.1%-previous
- 23:30 Japan CPI, Overall Nationwide* Sep 0.2%-previous
- 23:30 Japan Jobs/Applicants Ratio Sep forecast 1.24, 1.23-previous
- 23:30 Japan Unemployment Rate Sep forecast 3.4%, 3.4%-previous
- 00:00 New Zealand NBNZ Business Outlook Oct-18.9%-previous
- 00:00 New Zealand NBNZ Own Activity Oct 16.7%-previous
- 00:30 Australia PPI QQ* Q3 0.3%-previous
- 00:30 Australia PPI YY* Q3 1.1%-previous
- 00:30 Australia Private Sector Credit* Sep 0.6%-previous
- 00:30 Australia Housing Credit* Sep 0.6%-previous
- 05:00 Japan Construction Orders YY* Sep -15.6%-previous
- 05:00 Japan Housing Starts YY* Sep forecast 6.6%, 8.8%-previous
Looking Ahead - Events, Other Releases (GMT)
- 02:00 Japan- Bank of Japan announces interest rate decision
Currency Summaries
EUR/USD is likely to find support at 1.0895 and currently trading at 1.0975 levels. The pair has made session high at 1.0985 and hit lows at 1.0923 levels. The dollar declined against Euro on Thursday after release of disappointing economic data that indicated some weakness in US economy. The data showed the economy grew 1.5 percent in the third quarter, just missing the 1.6 percent estimated figures. Consumption was strong, with consumer spending up 3.2 percent and advance sales growing by 3 percent. A drawdown in inventories weighed on the overall figure. The euro advanced higher against the dollar, rising to $1.0977, after falling on Wednesday to its lowest since August. The dollar was flat against the Japanese yen at 121.09. Stocks on Wall Street and prices for U.S. Treasury debt fell after the data was released. Meanwhile, the dollar index, which measures the greenback against six major currencies, was down 0.36 percent at 97.426. To the upside, immediate resistance can be seen at 1.0993. To the downside, immediate support level is located at 1.0946 levels.
GBP/USD is supported in the range of 1.5200 levels and currently trading at 1.5310 levels. It reached session high at 1.5322 and dropped to session low at 1.5239 levels. Sterling edged higher against US dollar on Thursday, as the traders awaited with optimism when the UK interest rates would be hiked after the U.S. Federal Reserve indicated it could raise rates as soon as December. The Bank of England is the second major central bank waiting in the line to hike interest rates since the financial crisis, in contrast to the European Central Bank, which said last week it was it was prepared to further implement easing measures in the euro zone, which is Britain's biggest trading partner. Although sterling edged a slightly lower on Thursday, it remained close to that high, and was 0.2 percent higher against the dollar, at $1.5300. Against the BoE's trade-weighted currency index, it stood at 92.8, its strongest since September 21. The Bank of England, which is meeting next week, has indicated it need not wait for the Federal Reserve before it raises rates. But many traders believe that BoE's monetary policy committee (MPC) would not risk going first in hiking rates. To the upside, immediate resistance can be seen at 1.5337. To the downside, immediate support level is located at 1.5304 levels.
USD/JPY is supported around 120.44 levels and currently trading at 121.09 levels. It has hit session high at 121.17 and made session lows at 120.90 levels. US dollar marginally edged higher against Japanese yen on Thursday, shrugging of weak U.S. economic growth which braked sharply in the third quarter as businesses cut back on restocking warehouses to work off an inventory glut, but solid domestic demand could encourage the Federal Reserve to raise interest rates in December. Gross domestic product increased at a 1.5 percent annual rate after expanding at a 3.9 percent clip in the second quarter, the Commerce Department said on Thursday. Consumer spending, which accounts for more than two-thirds of U.S. economic activity, grew at a 3.2 percent rate after expanding at a 3.6 percent pace in the second quarter. A measure of private domestic demand, which excludes trade, inventories and government spending, rose at a sturdy 3.2 percent pace. Meanwhile the personal consumption expenditures price index rose at a 1.2 percent rate after rising 2.2 percent in the second quarter. To the upside, immediate resistance can be seen at 121.15. To the downside, immediate support level is located at 12089 levels.
USD/CAD is supported at 1.3147 levels and is trading at 1.3167 levels. It has made session high at 1.3204 and lows at 1.3153 levels. The Canadian dollar made modest gain against US dollar on Thursday, as domestic producer prices slipped and data showed U.S. economic growth declined sharply in the third quarter. Sluggish new U.S. home sales data, cut into some of oil's early gains, tempering the market's enthusiasm over U.S. government crude inventory data on Wednesday that showed a smaller build than many had feared. Canadian producer prices fell slightly more than expected in September, dropping 0.3 percent from August on lower prices for energy and petroleum products, Statistics Canada data indicated on Canadian dollar traded at C$1.3166 to the greenback, stronger than Wednesday's close of C$1.3192, or 75.80 U.S. cents. The currency's weakest level so far in the session was C$1.3236. To the upside, immediate resistance can be seen at 1.3200. To the downside, immediate support level is located at 1.3147levels.
Equities Recap
European shares fell slightly on Thursday, with banking stocks leading the way after disappointing updates from Deutsche Bank and Barclays, while investors assessed the negative impact of a U.S. rate hike by year-end.
UK's benchmark FTSE 100 closed down by 0.76 percent, the pan-European FTSEurofirst 300 ended the day down by 0.2 percent, Germany's Dax ended down by 0.36 percent, France's CAC finished the day down by 0.28 percent.
U.S. stocks ended slightly lower on Thursday, after data release from US showed disappointing readings on gross domestic product and pending home sales.
Dow Jones closed down by 0.13 percent, S&P 500 ended down by 0.04 percent Nasdaq finished the day down 0.42 percent.
Treasuries Recap
U.S. Treasuries prices fell on Thursday with benchmark yields jumping to their highest in a month as the U.S. economy expanded in the third quarter on solid consumer spending, reinforcing chances the Federal Reserve may hike interest rates in December.
Benchmark 10-year Treasuries notes fell 23/32 in price to yield 2.171 percent, up 8 basis points.
The 10-year yield broke above its 200-day moving average to reach its highest levels since late 30-year bond shed nearly 2 points in price with a yield of 2.961 percent, up almost 10 basis points.
Commodities Recap
U.S. crude rose slightly while Brent dipped on Thursday, as traders tried to discern the oil market's direction a day after prices rallied the most in two months even as supplies kept growing.
U.S. crude settled up 12 cents, or 0.3 percent, at $46.06 a barrel, after trading between $45.16 and $46.79. It had rallied nearly $3 the previous session.
Brent, the global oil benchmark, finished down 20 cents, or 0.5 percent, at $48.80, trading between $48.17.
Gold fell for a second day on Thursday, reaching its lowest level in three weeks, after the Federal Reserve hinted at a possible U.S. interest rate rise in December.
Spot gold, stronger initially due to a retreat in the dollar, fell as much as 0.9 percent to its lowest since Oct. 9 at $1,145.43 an ounce. It was down 0.8 percent at $1,146.10 at 2:58 p.m. EDT (1858 GMT).
U.S. gold futures for December delivery settled down 2.4 percent at $1,147.30 an ounce.
