Oil Futures End Flat

Trading 05 nov 2018 Commentaire »

Crude oil futures ended lower on Monday, after having moved up earlier in the day as U.S. sanctions on Iranian oil and came into force.

However, oil's decline was just marginal as the U.S. government decided to grant waivers to some buyers of Iranian crude.

Traders, looking ahead to the mid-term polls in the U.S., and the Federal Reserve's monetary policy statement on Wednesday, were quite reluctant to make significant moves.

Crude oil futures for December ended down $0.04, or less than 0.1%, at $63.10 a barrel. On Friday, crude oil futures declined by $0.045, or 0.9%, at $63.14 a barrel.

According to reports, U.S. President Donald Trump has said that he wants to go slow on Iranian sanctions, as doesn't want to drive up oil prices.

This decision by the Trump administration and recent data showing crude oil stockpiles in the U.S. to have increased for six successive weeks eased concerns about tighter supplies in the market.

Iran's President Hassan Rouhani has reportedly said that the Islamic republic would proudly bypass the illegal, unjust sanctions because it's against international regulations.

OPEC heavyweight Saudi Arabia has already stated that it would increase output to make up for the loss of Iranian oil in the market.

Some analysts are of the view that the ongoing U.S.-China trade dispute and its likely impact on the global economy could result in a notable drop in crude oil demand.


The material has been provided by InstaForex Company - www.instaforex.com

Treasuries Show Modest Move Back To The Upside

Trading 05 nov 2018 Commentaire »

Treasuries saw modest strength during the trading day on Monday, regaining some ground after moving notably lower last Friday.

Bond prices initially moved to the upside but pulled back off their best levels as the day progressed. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1.3 basis points to 3.201 percent.

The modest rebound by treasuries may have reflected their appeal as a safe haven ahead of Tuesday's midterm elections, which will decide control of both the House and Senate.

Democrats are seen as having a much better chance to claim a majority in the House than in the Senate, but controlling the lower chamber would still allow Democratic lawmakers to hinder President Donald Trump's agenda.

Traders may also have been looking ahead to the Federal Reserve's looming monetary policy announcement, with the Fed due to announce is latest decision on Thursday.

The Fed is widely expected to leave interest rates unchanged, but traders will keep a close eye on the accompanying statement for clues about an expected rate hike in December.

On the U.S. economic front, the Institute for Supply Management released a report showing a modest slowdown in the pace of growth in the service sector in the month of October.

The ISM said its non-manufacturing index dipped to 60.3 in October after climbing to 61.6 in September, although a reading above 50 still indicates growth in the service sector. Economists had expected the index to drop to 59.3.

Last month, the ISM said the non-manufacturing index unexpectedly rose in September, reaching its highest level since the inception of the composite index in 2008.

Treasuries gave back some ground following the release of the results of the Treasury Department's auction of $37 billion worth of three-year notes, which attracted below average demand.

The three-year note auction drew a high yield of 2.983 percent and a bid-to-cover ratio of 2.54, while the ten previous three-year note auctions had an average bid-to-cover ratio of 2.79.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

Looking ahead, the Treasury is due to sell $27 billion worth of ten-year notes on Tuesday and $19 billion worth of thirty-year bonds on Wednesday.

Traders may stick to the sidelines amid a quiet day on the U.S. economic front on Tuesday as they await the results of the midterm elections.


The material has been provided by InstaForex Company - www.instaforex.com

Dollar Paring Early Gains Ahead Of Midterm Elections

Trading 05 nov 2018 Commentaire »

The dollar got off to a positive start this morning, but has pared its gains over the course of the session. Traders are in a cautious mood ahead of tomorrow's midterm elections, the results of which will determine which party controls the House and Senate.

Investors are also looking forward to Thursday's monetary policy announcement from the Federal Reserve. The Fed is widely expected to leave interest rates unchanged, but traders will keep a close eye on the accompanying statement for clues about an expected rate hike in December.

Reflecting a slight cooling off after a record month in September, the Institute for Supply Management released a report on Monday showing a modest slowdown in the pace of growth in U.S. service sector activity in the month of October.

The ISM said its non-manufacturing index dipped to 60.3 in October after climbing to 61.6 in September, although a reading above 50 still indicates growth in the service sector. Economists had expected the index to drop to 59.3.

The dollar rose to an early high of $1.1354 against the Euro Monday, but has since retreated to around $1.1415.

Eurozone's investor sentiment eroded for a third consecutive month in November to its lowest level in two years, survey data from Sentix showed on Monday. The Sentix investor confidence indicator dropped to 8.8 from 11.4 in October. The latest reading, which matched economists' expectations, was the lowest since October 2016.

The buck reached a high of $1.2964 against the pound sterling Monday morning, but has since pulled back to around $1.3050.

The UK service sector registered its slowest rate of expansion in seven months in October, survey results from IHS Markit and the Chartered Institute of Procurement & Supply showed Monday. The services Purchasing Managers' Index dropped more-than-expected to 52.2 in October from 53.9 in September. The expected level was 53.4.

Members of the Bank of Japan's Monetary Policy Board said that the country's economy was continuing its modest expansion at a satisfactory rate, minutes from the central bank's meeting on September 18 and 19 revealed on Monday.

Domestic demand is expected to continue on an upward trend, the minutes added, while annual inflation is predicted to maintain its gradual climb to the target of 2 percent.

"Although it would take time to achieve the 2 percent price stability target, it was appropriate to persistently continue with the powerful monetary easing under the current guideline for market operations as the momentum toward achieving 2 percent inflation was being maintained," the minutes said.

The greenback rose to a high of Y113.340 against the Japanese Yen Monday, but has since eased back to around Y113.235.

The services sector in Japan continued to expand in October, and at a faster rate, the latest survey from Nikkei revealed on Monday with a PMI score of 52.4. That's up from 50.2 in September, and it moves back above the boom-or-bust line of 50 that separates expansion from contraction.


The material has been provided by InstaForex Company - www.instaforex.com

Dollar Paring Early Gains Ahead Of Midterm Elections

Trading 05 nov 2018 Commentaire »

The dollar got off to a positive start this morning, but has pared its gains over the course of the session. Traders are in a cautious mood ahead of tomorrow's midterm elections, the results of which will determine which party controls the House and Senate.

Investors are also looking forward to Thursday's monetary policy announcement from the Federal Reserve. The Fed is widely expected to leave interest rates unchanged, but traders will keep a close eye on the accompanying statement for clues about an expected rate hike in December.

Reflecting a slight cooling off after a record month in September, the Institute for Supply Management released a report on Monday showing a modest slowdown in the pace of growth in U.S. service sector activity in the month of October.

The ISM said its non-manufacturing index dipped to 60.3 in October after climbing to 61.6 in September, although a reading above 50 still indicates growth in the service sector. Economists had expected the index to drop to 59.3.

The dollar rose to an early high of $1.1354 against the Euro Monday, but has since retreated to around $1.1415.

Eurozone's investor sentiment eroded for a third consecutive month in November to its lowest level in two years, survey data from Sentix showed on Monday. The Sentix investor confidence indicator dropped to 8.8 from 11.4 in October. The latest reading, which matched economists' expectations, was the lowest since October 2016.

The buck reached a high of $1.2964 against the pound sterling Monday morning, but has since pulled back to around $1.3050.

The UK service sector registered its slowest rate of expansion in seven months in October, survey results from IHS Markit and the Chartered Institute of Procurement & Supply showed Monday. The services Purchasing Managers' Index dropped more-than-expected to 52.2 in October from 53.9 in September. The expected level was 53.4.

Members of the Bank of Japan's Monetary Policy Board said that the country's economy was continuing its modest expansion at a satisfactory rate, minutes from the central bank's meeting on September 18 and 19 revealed on Monday.

Domestic demand is expected to continue on an upward trend, the minutes added, while annual inflation is predicted to maintain its gradual climb to the target of 2 percent.

"Although it would take time to achieve the 2 percent price stability target, it was appropriate to persistently continue with the powerful monetary easing under the current guideline for market operations as the momentum toward achieving 2 percent inflation was being maintained," the minutes said.

The greenback rose to a high of Y113.340 against the Japanese Yen Monday, but has since eased back to around Y113.235.

The services sector in Japan continued to expand in October, and at a faster rate, the latest survey from Nikkei revealed on Monday with a PMI score of 52.4. That's up from 50.2 in September, and it moves back above the boom-or-bust line of 50 that separates expansion from contraction.


The material has been provided by InstaForex Company - www.instaforex.com

Gold Settles Slightly Lower

Trading 05 nov 2018 Commentaire »

Gold prices edged lower on Monday, despite having moved up earlier in the session after dollar weakened against most major currencies.

Reports that British Primer Minster Theresa May has secured a secret Brexit deal to keep the U.K. in the customs union lifted pound sterling and took some sheen off greenback.

The mood was generally cautious with traders looking ahead to the U.S. congressional mid-term elections and the Federal Open Market Committee meeting.

Gold futures for December ended down $1.00, or less than 0.1%, at $1,232.30 an ounce.

On Friday, gold futures ended down $5.30, or 0.4%, at $1,233.30 an ounce.

Silver futures for December declined by $0.109, at $14.647 an ounce, while Copper futures settled at $2.7560 per pound, losing $0.0510 for the session.

It is widely expected that the Fed will hold rates this month. However, a rate hike in December looks quite imminent. The accompanying statement is expected to provide some clues about future rate hikes and the central bank's views on the economy.

On the elections front, many analysts are of the view that the polls will give Democrats a chance to effectively oppose President Donald Trump's agenda. Opinion poll results give the Democrats a better chance at winning back a majority in the House than in the Senate.

On the trade front, hopes about a deal between the U.S. and China have faded after White House economic adviser Larry Kudlow downplayed the potential for a quick trade deal between the two countries.


The material has been provided by InstaForex Company - www.instaforex.com

Three-Year Note Auction Attracts Below Average Demand

Trading 05 nov 2018 Commentaire »

On Monday, the Treasury Department kicked off this week's series of long-term securities auctions with the sale of $37 billion worth of three-year notes, attracting below average demand.

The three-year note auction drew a high yield of 2.983 percent and a bid-to-cover ratio of 2.54.

Last month, the Treasury sold $36 billion worth of three-year notes, drawing a high yield of 2.989 percent and a bid-to-cover ratio of 2.56.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

The ten previous three-year note auctions had an average bid-to-cover ratio of 2.79.

Looking ahead, the Treasury is due to sell $27 billion worth of ten-year notes on Tuesday and $19 billion worth of thirty-year bonds on Wednesday.


The material has been provided by InstaForex Company - www.instaforex.com

May managed to remove the Irish issue from the Brexit agenda

Trading 05 nov 2018 Commentaire »

analytics5be057346327f.jpg

British Prime Minister Theresa May has made concessions from Brussels that will allow Britain to remain in the customs union and thus avoid the most difficult issue of the Brexit talks, the subject of the Irish border. Now, the customs border will not be held either between Ireland and Northern Ireland, nor between Northern Ireland and the island of Great Britain.

Brexit's chief negotiator for the European Union, Michel Barnier, said that the EU agreed to customs control not at the border, but directly at the factories and at points of sale.

In addition, Theresa May intends to achieve the conclusion of an economic transaction with the EU, which will allow the United Kingdom to conduct free trade with EU countries on the "Canadian model". According to this model, the UK will have the freedom to make decisions regarding domestic and foreign trade, and will also be able to create an effective and balanced migration mechanism that will stop the free movement of labor.

The material has been provided by InstaForex Company - www.instaforex.com

The US resumed sanctions against Iran

Trading 05 nov 2018 Commentaire »

analytics5be05134e81f7.jpg

The renewed sanctions against Iran that existed before the signing of the Joint Comprehensive Action Plan on the Iranian nuclear program in 2015 came into force this night.

Under the sanctions in the first place will fall the oil industry of Iran, as well as banking, shipbuilding, and shipping. In addition to the Islamic Republic itself, sanctions restrictions will affect all countries and foreign companies that maintain business ties with Iranian partners.

However, the Iranian government said it did not intend to stop selling oil, despite all the potential difficulties.

The material has been provided by InstaForex Company - www.instaforex.com

Iran reassured the markets, saying it would sell oil despite US sanctions

Trading 05 nov 2018 Commentaire »

analytics5be031671ef38.jpgIran will sell its oil, despite American sanctions that have affected the vital sectors of the local economy, energy and banking, said Iranian President Hassan Rouhani.

"America wanted to cut oil sales in Iran ... but we will continue to sell our oil ... breaking sanctions," Rouhani said on state television live.

The United States said it would temporarily allow eight importers to continue to buy Iranian oil. China, India, South Korea, Japan, and Turkey, all the leading importers of Iranian oil, are among the eight countries that are expected to be granted temporary exemptions to prevent a sharp jump in oil prices. US Secretary of State Mike Pompeo said that the new sanctions "are the toughest ever imposed on Iran." However, Iranian authorities have denied concerns about the impact of sanctions on the country's economy.

"This is an economic war against Iran, but the America must understand that it cannot use the language of force against Iran. We are ready to withstand any pressure," said Rouhani.

It is worth noting that Europe is against the new package of restrictions. European diplomats reported that the new mechanism for making payments for the supply of Iranian oil should be submitted until November 4, but will not be available until next year.

The material has been provided by InstaForex Company - www.instaforex.com

Weak dollar as a result of a Democratic victory, a weak euro as a result of a downturn

Trading 05 nov 2018 Commentaire »

analytics5be01bb3f0bc2.jpg

The dollar fell on Monday after three consecutive weeks of growth, investors took profits on the eve of US elections, the result of which could trigger a new rise in volatility in world markets.

Despite the sale of the dollar in the second half of last week, hedge funds increased net long positions to the highest levels since December 2016. In general, one should not wait for large-scale movements in relation to the dollar before the elections, while the euro almost paused, not really reacting to the latest news from Europe.

lYbjM_XaH4xtu8SS3-fPhvV1ZVCXExdPD3Cp4oQr

According to polls, the Democratic Party has a high chance of gaining control of the US House of Representatives, and the Republicans are likely to retain a majority in the Senate. Investors associate Democrats with a weak dollar, a weak equity market, and lower bond yields. On the other hand, recent reports have shown the strength of the US economy. Strong data also showed a growing difference between the confident US economy and the losing momentum of Europe, where, against the background of low rates, it was said that the ECB could extend the long-term lending program for the banking sector. The latest news reinforces the risk of a decline in the euro in the near future.

The material has been provided by InstaForex Company - www.instaforex.com