OVERNIGHT MARKET SNAPSHOT FOR TUESDAY 16/11/21 (as at 8am AEDT)
- SPI200 (Dec) overnight futures down 36 pts to 7433
- SP500 down 0.05 pts to 4682.80
- NASDAQ Composite down 7.11 pts to 15853.85
- Dow Jones down 12.86 pts to 36087.45
- FTSE100 up 3.95 pts to 7351.86
- DAX30 up 54.57 pts to 16148.64
- GOLD futures US session (Dec) down $3.50 to $1865.00 an ounce
- COPPER futures US session (Comex Dec) down $0.0413 to $4.4082 a pound
- OIL futures US Session (Nymex Dec) up $0.17 to $80.96 a barrel
- CRB Index up 0.37 pts to 237.46
- AUDUSD trading at 0.7347
- EURUSD trading at 1.1370
- GBPUSD trading at 1.3413
- USDJPY trading at 114.1300
- USD Index US Session (ICE Dec) up 0.377 to 95.505
US indexes did not get the new week off to a good start as inflation fears continue to weigh on bullish sentiment. An uptick in bond yields did not go un-noticed by the stock market and weighed on tech stocks which in turn weighed on the broader market. The 10-year bond price looks heavy and setting to push into new lows which may further drag on FAANGs and other tech and therefore the SP500. The Fed will have a lot to think about with the coming Biden infrastructure bill and accompanying inflationary pressures….but expect that they will stick to their mantra regarding employment and ‘transient inflation’…while crossing their fingers and hoping they are correct. The Feds counterparts in Europe; ie BOE and ECB; have mixed feelings with the BOE highlighting concern while the ECB continue to push back on the idea of rate rises. The DOW closed down 0.04% while the broader SP500 ended flat and the Nasdaq closed down 0.04% for the session. In Europe, major Indexes were helped higher…especially the German DAX…as ECB president Lagarde said ‘the current inflation spike will be longer than once anticipated but would fade next year’…basically feel free to keep the stock market rally going. Resource stocks came under pressure on Chinas pledge to ‘phase down’ coal.
The USD Index rallied and is now clearing the 95.000 level after a brief pause Friday. Price was contained until the US open when bulls stepped into the action to lift the Dollar up through Fridays highs. The next clear resistance zone is now up around the 97.675 zone which may be the target of bulls if sellers remain on the sidelines and bond prices continue lower…not such a good thing for Stock Indexes. The EURUSD fell off a cliff down through the 1.1435 level and held the losses into the close. The rally in the USD pressured price along with ECB Lagarde comments on rates. Now it is clear for FX traders that they will not expect to see any yield advantage for the Euro if rates remain on hold into 2023. The GBPUSD also came under pressure but held up well compared to the Euro. Price held below 1.3440 but also managed to hold above 1.3400 under the USD pressure. With the BOE again highlighting inflation concerns, traders are again gearing up for a rate rise soon and may continue to provide support for the currency in the near term above 1.3350. The AUDUSD was doing well through Asian and European trade until the US opened and the Dollar rallied. Still, price is holding the recent trend up but will need to hold above 0.7340 today to keep the move up intact. The USDJPY held the 113.780 level well and found the buyers it needed for a rally into previous highs. Watching the 114.270 zone today to see if sellers step into the action to defend or whether bulls plough through to new short term highs.
SPOT GOLD was capped by the rally into the USD but continued to look positive for gold bugs into the close. Price continued to hold higher lows into 1869 where sellers are adamant they expect the level to hold. The daily timeframe is well extended and there are a lot of buyers stacked up long that could get squeezed out of the action on a pullback. If sellers are right and the price breaks below 1856 as the USD continues up, expect to see a short term flush lower. Crude Oil again was a grinding mess lower until the final few hours of the US session when price spiked to flush out the sessions sellers. Price action grinded its way down below the $80 level before ramping straight back to where it started the day. This suggests that buyers are still active and soaking up this short term selling pressure. Watching to see how sellers react today around the $81 area to see if bulls are able to get some follow through on the late session rally. Copper reversed Fridays price action as the USD pressured higher and weighed on Copper bulls. Price spiked up through resistance around 4.4545 on the open for trade yesterday but it was then all one way action lower with the anchor to the short term move down at 4.4490 for now. If bulls can fight back and hold above 4.3750, expecting to see a move up through the anchor at 4.4490.
Cryptocurrencies were a tale of two sessions with a rally in the Asian session and then a selloff in US trade. Prices generally took a hit in US trade to give back earlier gains with Bitcoin back below the 64K level. Bitcoin is currently trading at $63809.20 down 0.63% while Ethereum is trading at $4563.42 down 0.19% and Ripple is at $1.17550 down 0.63%.
The ASX200 continued on yesterday from where it left off last week with another positive session. The index ended up 27.1 points to 7470.1 with shares in the Healthcare, IT and Gold sectors supporting the index while Energy was the main drag on the bulls. The Nikkei added another 0.56% while the Hang Seng was well contained within Fridays action ending up 0.25%.
The ASX200 is expected to open down 35 points as the SPI200 was all one way action lower in overnight trading.
ECONOMIC DATA OUT TODAY (AEDT)
AUD Monetary Policy Meeting Minutes 11:30am
AUD RBA Gov Lowe Speaks 1:30pm
GBP Claimant Count and Unemployment Rate 6pm
EUR Flash Employment Change and GDP 9pm
USD Retail Sales Data 12:30am
USD Industrial Production 1:15am
SPI200 INTRADAY LEVELS TO WATCH