Oil Futures Settle At Over 14-month Low

Trading 17 déc 2018 Commentaire »

After edging up marginally earlier in the session, crude oil futures tumbled and settled at over 14-month low on Monday, on demand growth concerns.

Concerns about a likely fall in crude demand, Qatar's exit from OPEC and Iran's unwillingness to commit to an across the board production cut weighed down the commodity.

Crude oil futures for January ended down $1.32, or 2.6%, at $49.88 a barrel, the lowest settlement since early October 2017.

On Friday, crude oil futures ended down $1.38, or 2.6%, $51.20 a barrel.

Reports about a jump in crude stocks at the U.S. storage hub last week raise concerns that the Energy Information Administration's weekly oil report this Wednesday may show a jump in U.S. crude inventory last week.

A report from Genscape showed that U.S. crude inventories at the storage hub of Cushing, Oklahoma increased by over 1 million barrels last week.

A recent report from Energy Information Administration expects a surge in U.S. shale oil production.

Slower pace of industrial production and retail sales growth in China, weak eurozone economic data, the European Central Bank Mario Draghi's warning that the "balance of risks is moving to the downside," and the lowering of GDP and inflation forecasts for the eurozone has raised concerns that energy demand is likely to drop notably in the near to medium term.


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Treasuries Move Higher Amid Substantial Volatility On Wall Street

Trading 17 déc 2018 Commentaire »

After ending last Friday's trading modestly higher, treasuries saw some further upside over the course of the trading session on Monday.

Bond prices reached new highs in afternoon trading before moving roughly sideways going into the close. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 3.4 basis points to 2.857 percent.

The continued strength among treasuries came amid considerable volatility on Wall Street, with stocks recovering from early weakness only to pullback sharply in the afternoon.

With the sell-off, the Dow has tumbled to a seven-month intraday low, while the Nasdaq and the S&P 500 have slumped to their lowest intraday levels in ten months.

Treasuries also benefited from the release of some disappointing U.S. economic data, including a report from the National Association of Home Builders unexpectedly showing a continued deterioration in homebuilder confidence in the month of December.

The report said the NAHB/Wells Fargo Housing Market Index dropped to 56 in December after tumbling to 60 in November. Economists had expected the index to inch up to 61.

With the unexpected monthly decrease, the housing market index tumbled to its lowest level since hitting 54 in May of 2015.

NAHB Chief Economist Robert Dietz called the housing slowdown an "early indicator of economic softening."

A separate report from the New York Federal Reserve showed a much bigger than expected slowdown in the pace of growth in regional manufacturing activity in December.

A report on new residential construction in November may attract attention on Tuesday, although trading activity could be somewhat subdued as the Federal Reserve's two-day monetary policy meeting gets underway.


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Gold Futures Settle At Over 1-week High

Trading 17 déc 2018 Commentaire »

Gold futures settled at over one-week high on Monday, as the U.S. dollar slipped against most major currencies on disappointing economic data and equities declined on global growth concerns.

Markets are looking ahead to the upcoming Federal Reserve monetary policy meeting. The Fed is widely expected to raise its benchmark interest rates by 25 basis points, but it looks very unlikely that there will be frequent increases in the coming year.

The Fed's statement and forecasts that will be released after the announcement about rate, will provide clues about future rate hikes.

Meanwhile, fears of a possible U.S. government shutdown over security on the border with Mexico too weighed on the greenback and contributed to its weakness. In the event of the Trump administration and Democrats not agreeing on a new spending plan for building a wall along the U.S.-Mexican border, several U.S. government operations could shut down at midnight Friday.

The dollar index declined to 96.52, losing about 0.4%.

Gold futures for February ended up $10.40, or 0.8%, at $1,251.80 an ounce. On Friday, gold futures settled at $1,241.40 an ounce, down $6.00, or 0.5%.

Silver futures for March ended at $14.759 an ounce, up $0.122 from Friday's close.

Copper futures for March settled at $2.754 per pound, declining from Friday's close of $2.763 per pound.

In economic news, After reporting a sharp pullback in U.S. homebuilder confidence in the previous month, the National Association of Home Builders released a report on Monday unexpectedly showing a continued deterioration in confidence in the month of December.

The report said the NAHB/Wells Fargo Housing Market Index dropped to 56 in December after tumbling to 60 in November. Economists had expected the index to inch up to 61.

With the unexpected monthly decrease, the housing market index tumbled to its lowest level since hitting 54 in May of 2015.

Business activity in the New York manufacturing sector saw substantially slower growth in the month of December, according to a report released by the Federal Reserve Bank of New York on Monday.

The New York Fed said its general business conditions index tumbled to 10.9 in December after rising to 23.3 in November.

While a positive reading still indicates growth in regional manufacturing activity, economists had expected the index to dip to 20.0.


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Dollar Weakening Ahead Of Fed Announcement

Trading 17 déc 2018 Commentaire »

The dollar is losing ground against all of its major rivals Monday afternoon. Traders are in a cautious mood ahead of the Federal Reserve's highly anticipated monetary policy announcement scheduled for Wednesday.

The Fed is widely expected to raise interest rates by another quarter point, although traders are likely to closely scrutinize the central bank's accompanying statement and forecasts for clues about future rate hikes.

Business activity in the New York manufacturing sector saw substantially slower growth in the month of December, according to a report released by the Federal Reserve Bank of New York on Monday. The New York Fed said its general business conditions index plunged to 10.9 in December after rising to 23.3 in November.

While a positive reading still indicates growth in regional manufacturing activity, economists had expected the index to dip to 20.0.

After reporting a sharp pullback in U.S. homebuilder confidence in the previous month, the National Association of Home Builders released a report on Monday unexpectedly showing a continued deterioration in confidence in the month of December.

The report said the NAHB/Wells Fargo Housing Market Index dropped to 56 in December after tumbling to 60 in November. Economists had expected the index to inch up to 61.

The dollar has dropped to around $1.1350 against the Euro Monday afternoon, from an early high of $1.1299.

Eurozone consumer price inflation in November eased more than initially estimated, latest data from Eurostat showed on Monday. The consumer price index rose 1.9 percent year-on-year, which was slower than the 2 percent flash estimate on November 30. The figure is the lowest since May, when it was at the same level.

The buck has fallen to around $1.2625 against the pound sterling this afternoon, from a high of $1.2552 this morning.

UK households' assessment of their future financial wellbeing fell to its lowest level in six months in December, amid a stronger increase in living costs and a weaker rise in employee earnings, survey data from the IHS Markit and Ipsos MORI showed on Monday.

The IHS Markit Household Finance Index, or HFI, fell to 43.9 from 44.4 in November, marking the lowest reading since June.

The greenback has dropped to nearly a 1-week low of Y112.725 against the Japanese Yen Monday afternoon, from an early high of Y113.520.


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Annual inflation in the eurozone in November was 1.9%

Trading 17 déc 2018 Commentaire »

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According to the final data of the European statistical agency Eurostat, annual inflation in 19 eurozone countries fell from the October level of 2.2% to 1.9% in November (1.5% in 2017). Experts predicted that consumer price growth would be 2%.

Annual inflation throughout the European Union slowed from 2.2% in October to 2% in November. In 2017, the same indicator was fixed at 1.8%.

The highest rate of inflation in annual terms was recorded in Estonia, Hungary, and Romania (3.2% in each country). The lowest consumer price growth rates were recorded in Denmark (0.7%), Ireland (0.8%) and Portugal (0.9%).

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U.S. Homebuilder Confidence Unexpectedly Slumps To Three-Year Low In December

Trading 17 déc 2018 Commentaire »

After reporting a sharp pullback in U.S. homebuilder confidence in the previous month, the National Association of Home Builders released a report on Monday unexpectedly showing a continued deterioration in confidence in the month of December.

The report said the NAHB/Wells Fargo Housing Market Index dropped to 56 in December after tumbling to 60 in November. Economists had expected the index to inch up to 61.

With the unexpected monthly decrease, the housing market index tumbled to its lowest level since hitting 54 in May of 2015.

"The fact that builder confidence dropped significantly in areas of the country with high home prices shows how the growing housing affordability crisis is hurting the market," said NAHB Chief Economist Robert Dietz.

He added, "This housing slowdown is an early indicator of economic softening, and it is important that builders manage supply-side costs to keep home prices competitive for buyers at different price points."

The unexpected drop by the housing market index reflected decreases by all of the component indexes, with the index measuring current sales conditions showing a notable six-point slump to 61 in December from 67 in November.

The component gauging expectations in the next six months also slid to 61 in December from 65 in November, while the metric charting buyer traffic edged down to 43 from 45.

"We are hearing from builders that consumer demand exists, but that customers are hesitating to make a purchase because of rising home costs," said NAHB Chairman Randy Noel. "However, recent declines in mortgage interest rates should help move the market forward in early 2019."

On Tuesday, the Commerce Department is scheduled to release a separate report on new residential construction in the month of November.


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Heat" on Forex: The Fed meeting, the Central Bank of England and 7 more events

Trading 17 déc 2018 Commentaire »

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The news background will be abundant, so the new week promises to be fruitful for traders and will bring a lot of investment ideas. Today, there are data on inflation in the euro area, which traditionally have an impact on the euro due to the fact that they are one of the important parameters that shape the direction of the ECB rate. It is expected that the annual rate in November will remain at 2%, which will be a signal for further tightening of the ECB's plans. The single currency may rise in price in response to the publication of the release.

However, now after the correction, the euro / dollar pair is preparing to decline. On Friday, the sellers broke through two supports, 1.1341 and 1.1318, while today at Asian trading, they shifted a maximum of 1.1313. The course may be slowly moving up, but analysts are still waiting for the downward movement of the pair.WXryUKagjZKubSA18n3Wq5G7zqLwR4I1X7xMCSW3On Tuesday, Germany will present the business climate index, and the US will publish data on the number of building permits issued. It is predicted that the situation in the construction sector improved last month; if this is confirmed, the dollar will not allow the euro to climb far to the top. With strong statistics, dollar bulls will try to play their positions.

Especially tense will be the middle of the week, the expected block of data on inflation in the UK. This indicator is likely to grow in annual terms from 2.4% to 2.5%. Accelerating inflation seems to be a positive factor that may contribute to an increase in the value of a pound. However, there is another side to the coin: the acceleration may be dictated by the weakening of the sterling due to Brexit. In other words, this does not apply to production inflation. This means that the British currency risks to go down again, especially since the country's Prime Minister Theresa May remains in her position and continues the process of leaving the EU.28Y9qKWD6B6zwTNkeUmp9v5keOb_71jYRHGzLSLJOn the same day, Fed officials will announce a decision on the interest rate, which is likely to be raised from 2.25% to 2.5%. However, market participants will be most interested in the statements of the FOMC representatives, namely their plans for the future. Traders want to have information about the rate of policy tightening in 2019.

Although the decision on the rate at the last meeting this year does not cause disputes and is not a secret, the dollar can give a reaction, having strengthened in pair with the euro to 1.1280.

On Thursday, traders will continue to concentrate on the British pound, as the Bank of England will announce the rate decision. Here, changes in monetary policy are not expected, the regulator made it clear that he does not plan to raise the rate before the spring of next year. No surprises are expected from the Central Bank, therefore a retail indicator may surprise the market, which is unlikely to affect the overall dynamics of the pound.

On Friday, the day of GDP. Data on growth rates will be published by three powers at once, the USA, Great Britain, and Canada.

If the release of the latter is optimistic, the Canadian dollar will receive support in the short term. In the more distant future, the US dollar / Canadian dollar pair will remain in the range of 1.33-1.35. As for the UK, the final assessment of economic growth can be adjusted.

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*U.S. Housing Market Index Drops To 56 In December

Trading 17 déc 2018 Commentaire »

U.S. Housing Market Index Drops To 56 In December


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Where will the dollar go after the Fed meeting – Goldman opinion

Trading 17 déc 2018 Commentaire »

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Traders fixed their attention at the most important event of the coming days, the Fed meeting. If the change in rates at the December meeting is clear, then the prospects for the future are vague. Traders can only assume and be content with rumors about a possible pause of tightening the Fed policy.

The dollar has every chance to see new highs in relation to the G-10 basket of currencies if the US Central Bank, following the meeting on December 19, maintains its forecast for three rate hikes in 2019. This was signaled by experts at Goldman Sachs.

As for the forecast of the bank analysts themselves, they believe that the members of the Federal Reserve will still moderate their ardor and reduce the number of series of rate increases to two. Goldman also noted that the dollar may become more expensive in the absence of dovish wording in the final statement or at a press conference.IH8-thXVK5IO_knotXz6RK77N8aeqDLC4LiQhESJExperts spoke about the euro. The ECB's conclusion that the balance of risks is shifting in a positive direction, combined with problems in Germany and France, means that the Eurocurrency can show growth against the dollar only after a few months.OD_LV1JGG3V6T8Gk2uhWdHzBQC_EMckYLixEvJbvIn the short term, the euro may weaken against a number of cross-currencies. Goldman Sachs is short on EUR / AUD. According to the strategists, it will help to benefit from the "positive noise" from the trade negotiations between Washington and China and the stability of the yuan.

It is expected that British Prime Minister Theresa May will deal with the problem of leadership in the party, which over time will enhance the positive effect on the pound.

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No longer a leader: the number of drilling rigs in the USA has reached a minimum

Trading 17 déc 2018 Commentaire »

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According to Baker Hughes, an oil and gas service company, over the past week, the number of operating oil drilling rigs in the United States has decreased by 4 to 873 units. As a result, America's leadership position on this issue has been shaken, analysts say.

According to experts, this figure is the minimum value since mid-October this year. Previously, an even more significant decline was recorded by 10 pieces. Experts consider such a weekly drop as the highest since April 2016. The previous impressive reduction in the number of drilling rigs was in mid-August 2018, when their number decreased by 9 pieces.

The total number of oil and gas rigs decreased by 4 to 1075 units. During the reporting period, the number of gas installations remained the same, 198 units.

Recall, the absolute record for the number of operating oil installations in the United States was reached in October 2014. At that time, their number was 1609 pieces. This year, the peak values were reached last week from November 14 until November 16, when the number of active rigs was 888.

According to statistics from the US Department of Energy, published last Wednesday, December 12, the volume of oil production in the country fell to 11.6 million barrels per day. This was preceded by three weeks of stability when production levels remained at 11.7 million barrels per day. Experts believe this figure is quite high.

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