Daily summary: US stocks erase some gains on geopolitical tensions

• European indices extended gains into a fourth day on Tuesday, with German Dax up 0.46% as gains in technology sector outpaced poor performance of telecoms. Market moods improved  during European session following better than expected ZEW  reading and lower US inflation figures.

• FTSE 100 finished today's session 0.21% lower as fresh data showed that UK unemployment rate unexpectedly increased in the three months to September, while vacancies fell for the fifth consecutive period as employers grew worried about the domestic economic outlook.

• Following the release of softer-than-expected PPI figures for October  stock futures tied to the blue-chip Dow Jones jumped 1% on Tuesday, and those linked to the S&P 500 and Nasdaq rose 1.5% and 2.5% respectively, as  reading strengthened expectations that the Fed will slow the pace of rate hikes. However, the upward move lost steam later in the session after Fed Bostic warned that he sees little evidence that inflation is easing while signaling that interest rates will have to rise further for the central bank to reach its goals. This hawkish view from Raphael Bostic contrasts sharply with remarks from Fed Vice Chair Brainard and Fed Harker that hinted at a less aggressive tightening. 

• Sentiment deteriorated even further in the evening, following unconfirmed and conflicting reports that two Russian missiles landed in Poland killing two civilians. The Pentagon said it cannot corroborate reports on this event at the moment. Later on Polish Radio Zet reported that the missile is most likely the remains of a rocket shot down by the Armed Forces of Ukraine. Russian officials denied accusations and called events in Poland a provocation which aims to escalate the war, while Ukrainian president Zelensky claims that it was indeed a Russian attack and that he warned the West that Kremlin actions are not limited to Ukraine. White House announced it will determine what occurred and what the appropriate next steps are.

• Walmart jumped more than 8% after the retailer beat Wall Street earnings and revenue forecast and raised full-year guidance.

• Chinese stocks listed in the US rose sharply early in the session as Biden and Xi during the G20 Summit in Indonesia called for reduced tensions between both nations.  

• Crude oil price rose over 1.0% amid growing expectations that Beijing will increase stimulus measures and ease COVID restrictions to support the struggling economy as recent industrial production and retail sales figures were disappointing. In the evening news emerged that oil transfers to Hungary via Druzhba pipeline will be suspended due fall in pressure.

• Mixed moods prevails on the precious metals market. Gold erased most of early gains and is trading around $1775 per ounce, while silver failed to stay above $22.00 level and plunged 2.5% to $21.50 per ounce.

• The US dollar weakened sharply early in the session and downward move accelerated following publication of US producer prices. Dollar index briefly fell to 105.60, however market sentiment shifted later in the session as it seems that investors reacted overly optimistic to this second tier data. Greenback managed to erase some losses following news from Poland.Currently AUD and NZD are the best performing major currencies while EUR and CHF lag the most.

• Mixed sentiment prevails on the cryptocurrency market after WSJ reported that crypto lender Blockfi is gearing up for potential bankruptcy. Bitcoin is currently trading below $16800 level, while Ethereum bounced of local resistance at $1285.

USDCHF fell around 7.0% from November highs, however the downward move was halted by a long-term upward trendline. As long as price sits above it, resumption of an upward move is still on the cards. Source: xStation5