- European indices finished today's session mostly lower , with German Dax being the exception, boosted by a 7% jump in Siemens which posted solid quarterly results and expects strong demand for hardware and software.
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FTSE 100 closed slightly below the flatline in a choppy session on Thursday as UK Chancellor Hunt proposed around £30 billion in spending cuts and £25 billion in tax increases, including a six-year freeze on income tax thresholds and lowering the top income tax rate to £125,000. Hunt expects that the UK economy will shrink by 1.4% in 2023, compared with a forecast for growth of 1.8% published in March.
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US indices launched today's session sharply lower following hawkish comments from several FED members, however buyers managed to halt declines later in the session. Currently all three major Wall Street indices are trading flat.
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St Louis Fed President James Bullard emphasized that the central bank still has much work to do before reaching its goals, warning that tightening conditions had only a modest effect on inflation.
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San Francisco Fed President Mary Daly expressed a similar view, saying that she sees the central bank raising at least another percentage point.
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On the other hand Fed Mester warned against a sudden increase in the risk of financial stability in opposition to Bullard's position, which pointed to a still relatively low risk of stability, which was also presented by the St.Louis Federal Reserve model.
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House Speaker Nancy Pelosi announced she will step down from her congressional leadership role, ending a two-decade streak as the top House Democrat. She will remain as congress member.
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On the data front, US jobless claims fell more than expected to 222k, while the Philadelphia Fed Manufacturing Index fell to -19.4, the lowest since May of 2020. Housing starts in the US declined 4.2% mom to a seasonally adjusted annualized rate of 1.425 million in October, while building permits fell 2.4% to 1.526 million
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Oil tumbled over 4.0% on renewed demand worries, as China is still facing a rising number of Covid cases that clouded the demand outlook in the world’s biggest crude importer. Also stronger dollar and easing geopolitical tensions put additional selling pressure on energy commodities.
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Nickel futures fell over 7.0% after the London Metal Exchange (LME) sharply raised the initial margin required to trade this commodity.
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NATGAS price jumped 5.0% as heating demand is set to rise this week due to colder weather while weekly EIA data showed US utilities added 64 billion cubic feet (bcf) of gas to storage, in line with expectations.
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The dollar index strengthened on Thursday as hopes for a pause in interest-rate hikes started to fade, however buyers failed to break above 107 mark and index pulled back slightly in the evening. Currently CAD and USD are the best performing major currencies while AUD and CHF lag the most.
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Stronger dollar also weighed on precious metals. Gold fell nearly 1.0% to $1760 level, while silver plunged over 3.0% below support at $21.00.
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Major cryptocurrencies managed to erase early losses and are trading more or less around the flat line. Bitcoin climbed above $16600 level, while Ethereum managed to defend support at $1200.
US30 managed to break above major resistance at 33700 pts, which coincides with 61.8% Fibonacci retracement of the downward correction launched in January 2022. Moods improved later in the session, however as long as sellers manage to keep the index below the aforementioned level, downward move may deepen towards support at 32620 pts. Source: xStation5
