English (India)
19
Nov

US Jobless Claims, Existing Home Sales

calendar 19/11/2020 - 10:06 UTC

The dollar traded mostly unchanged against other major currencies on Wednesday. Then by Thursday morning the dollar noticeable strengthened with currency pairs like the GBP/USD or EUR/USD moving in the favour of the dollar and the USD/JPY pair seemingly stabilizing after the decline of well over one per cent over the course of the past week.

Bitcoin prices peaked at around $18,500, which is already quite close to the previous all-time high in December 2017. By Thursday morning the prices were again clearly below $18k, but it remains to be seen if that is only a short-term setback for the biggest cryptocurrency, whose market capitalization still is above $325 billion.

European markets showed a mixed picture with no upside seen for now, despite news that the Pfizer COVID vaccine was claimed now to have an efficiency of even 95 per cent. The impact and fears of new lockdowns across the continent as the number of new infections remains high could have spooked the markets.

On Thursday the unemployment rate for France in Q3 and the trade balance of Switzerland in October will be released. Then from the US as usual on a Thursday weekly jobless claims can be expected. On top of that the Philadelphia Fed General Business Conditions survey results and data on existing home sales can be expected.

EUR/USD

The weakness of the euro moved the EUR/USD pair again below 1.185, while the also far from strong greenback meant that losses were rather limited. On Wednesday the euro continued on the downwards slope against other majors with the EUR/GBP and EUR/JPY pairs moving lower. Against the Turkish lira (TRY) the euro managed however to maintain its position and is still trading well above the 9-mark of the EUR/TRY pair, which was tested on Friday.

Inflation in the euro zone was as expected at -0.3 per cent annually for October and thus still significantly below the level sought by central banks.

Recent speeches from the President of the ECB Christine Lagarde indicated that even the positive expectations that an effective COVID vaccine might be available next, would not change her plans to infuse more stimulus into the markets.

On Thursday the Philadelphia Fed Manufacturing Index will be released. Also on Thursday the ECB President is scheduled to talk at a hearing of the European Parliament’s Committee on Economic and Monetary Affairs.

EUR/USD

Gold

Gold prices were yet again under pressure on Wednesday, with the price move negative by Thursday morning for the third consecutive day. At that time also a support around the $1,860 mark is being tested.

Analysts mentioned that chart-technical impacts could have further exacerbate the losses of long positions. Gold prices declined again on a day, when indices were under pressure, while the performance of the US dollar against other majors was mostly unchanged.

Platinum prices meanwhile established a new two months high as an ounce of the precious metal was traded at times at just marginally below $960 per troy ounce.

Gold

WTI Oil

While oil prices were unable to close at the intraday close, still a sizable upside move was left at the end of the day, bringing oil on track at current price levels to end the week for the third time in a row in the green.

Data from the Energy Information Administration (EIA) showed that over the course of the past reporting week, crude oil inventories increased by just 0.8 million barrels, which was a quite moderate number, compared to the built of 4.2 million barrels announced by the American Petroleum Institute (API) a day earlier.

Recent reports about the United Arab Emirates being unhappy taking part in the OPEC+ production cuts and privately mulling to even exit the agreement might make the upcoming OPEC meeting in 1-½ weeks even more determinantal for the oil markets in the coming months as demand might again be affected by wide-reaching government measures meant to curb the spread of the novel coronavirus.

WTI Oil

US 500

Stock market indices almost uniformly traded lower on Wednesday and tested even lower limits by Thursday morning. The fundament data on the housing market was quite a bit mixed, with the housing starts in October clearly beating expectations, with housing starts now even annually up by 4.9 per cent at 1.53 million units in the previous month. However, there are concerns, whether this will last as the number of permits marginally declined from 1,553 million in the previous reading to 1.545 million.

The stock price of EventBrite (+5.22%) continued to move higher, towards the highest level since March, when the pandemic affected the whole market segment. One of the factors for the rally was said to be the acquisition of the event creator toolkit company ToneDen, which has been a partner of the company on its app marketplace for years. Since Friday, the stock price improved by more than 30 per cent.

Shares of Nvidia, which is known for its chips used in graphic cards, vehicles and a whole array of high performance computing applications were slightly down in after-hours trading after the company disclosed its quarterly results, which showed a record for both revenue and profit in a quarter. While the revenue from gaming and data centres was a strong contributor for these results, the company expects a decline in revenue from the data centre segment in the current quarter.

US 500

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