Daily Summary: dovish speech by Jerome Powell drives gains in markets 🧨

• Wall Street indices gain after the FOMC decision. US500 and US100 rise between 0.60-0.70%, breaking above this year's highs.

• Powell's comments seem to take a distinctly dovish tone. Mentioning the topic of the first rate cut strengthened the bullish surge in the markets, which overall led the US30 index above historical highs. The FED explains that interest rates are already at the target level or very close to it. However, Powell adds that if the situation requires, the FED will decide on another rate hike.

• The swap market prices in that interest rates will be reduced by a total of 134 basis points in 2024.

• European markets, however, recorded mixed levels. The German DAX ended the session 0.15% lower than yesterday. The Polish WIG20 fared relatively well compared to other markets, gaining 0.2%.

• The best-performing currencies in the FX market are currently the Australian dollar and the Japanese yen. On the other hand, the biggest declines are now seen in the US dollar and the British pound.

• Data on the change in US crude oil inventories fell more than analysts expected. “Black gold” reserves changed by -4.25 mb compared to the expected -1.5 mb (API data indicated a decrease of 2.35 mb)

• November PPI inflation data came out as expected:

  • PPI inflation for November: 0.9% y/y (expected: 1.0% y/y; previously: 1.3% y/y)
  • Monthly PPI inflation: 0.0% m/m (expected: 0.1% m/m; previously: -0.5% m/m)
  • Core PPI inflation: 2.0% y/y (expected: 2.2% y/y; previously: 2.4% y/y)
  • Monthly core inflation: 0.0% m/m (expected: 0.2% m/m; previously: 0.0% m/m)

• In the precious metals market, we also observe increases. Gold returns above the 2000 USD level, gaining 1.75%. Silver records slightly higher increases of 3.20% to the level of 24.55 USD.

• In the energy commodities market, the biggest increases can be observed in NATGAS, which gains about 2.00%. Next, oil quotes rise about 1.10-1.30%. WTI oil gains to the level of 70 dollars per barrel.

• Bitcoin sharply gained in value after the announcement that cryptocurrencies are to be valued at fair value according to the new FASB rules, i.e., the Financial Accounting Standards Board. The above institution is clearly involved in official work related to the acceptance of spot ETF funds on Bitcoin, which in this case may suggest that the official process regarding the funds is still progressing.

• The FOMC decision was another catalyst for the cryptocurrency market to continue its growth. Bitcoin recovers losses after a few days of deeper correction, and at the time of publication, quotes are rising by 3.60% to the level of 42600 USD.

Gold (GOLD) tests the resistance zone at the level of 2015 dollars per ounce after today's FOMC decision and Powell's comments. Source: xStation