FX Careers

General Market Analysis | 17 November 2023

US Markets Steady as Data Helps Fed

US stock markets had a relatively steady day yesterday as fresh data continued to indicate that the Fed is winning its battle against inflation and the next move for rates could be down rather than up. The S&P made 0.13%, the Nasdaq added just 0.08% and the Dow fell 0.13% as claims for unemployment benefits rose higher than expected and Industrial Production numbers dropped. Treasury yields fell again, the 10-year down to 4.45% and the 2-year off 7 basis points to trade at 4.84%. Currencies remained in relatively tight ranges; Gold gained ground back to the $1,980 level but Oil took another step lower.

Oil Prices Take Another Hit as Demand Is Set to Fall

Oil prices took another dive in trading yesterday to hit their lowest levels in our months as demand fears dominated price action a little over a month after war fears in the Middle East sent prices rapidly in the other direction. Prices dropped around 5% in trading yesterday as support levels broke, benchmark Crude is now trading around $77.9 a barrel and WTI is at $73.4 a barrel. Declining data in the US is leading to demand concerns as is the situation with the Chinese economy despite some encouraging recent indicators. Some traders now feel that this move could be overextended, especially over the next few sessions into the weekend and the event risks that the closed market presents with tensions still high in the Middle East and they are expecting more volatility in ‘Black Gold’ as we move towards the end of the year.

Quiet Data Day Ahead to Take Traders into the Weekend

Some traders might be forgiven for hoping for a quiet day ahead after what has been another interesting week in financial markets, but despite a relatively bear event calendar, there could be some more moves to negotiate before 5 pm New York. We have already seen some more positive PPI numbers out of New Zealand this morning in the Asian session but there is little else on the calendar to inspire fresh moves so expect the market to remain rangebound. However, the European Open presents us with the main risk events of the day in the form of the UK Retail Sales data release and another speech from ECB President Christine LaGarde. In the New York session, we have US Building Permits data as well as updates from the FOMC’s Goolsbee and SNB Chairman Thomas Jordan before traders can eventually put their feet up on the 5 pm bell.