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Market Moving Fundamental News

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Natural Gas is expected to see an upside climb, while WTI crude oil sees the probability of a dip below the key %50 handle, according to Francis Hunt of The Market Sniper. Francis explains through technical charts how it is too soon to call a bottom in oil prices. The pattern formations have failed, so the outlook remains more cloudy. There is high chance that oil dips lower to form new lows. On Natural Gas, he explains the behaviour in prices during times of crisis events.

Francis further shares the outlook for DAX and the FTSE 100, noting that the Footsie will likely underperform ahead versus the DAX. Francis’ outlook and trade calls for Commodities and Equity Index WTI failed to hold the $60 line. Probability of a sub $50 move does exist. Bullish on Natural Gas Natural Gas looking good for a range-trade. Trade call: Buy at 2.75, 3.4 remains the target – Technical Analysis DAX – Plenty of fightback left Pull back has been moderate, DAX remains in the long-run bull-trend. Might see a continuation pattern to the topside. EUR weakness might pour in more buyers.

Outlook: Upside expected FTSE: underperforming on weighing commodities and GBP strength. Reverse currency effect seen in the index.

Outlook: Might continue to underperform versus DAX, as commodities are expected to soften.

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Oil prices continue to take hits from multi-factor market pressures, S&P 500 to break lower?

 

With crude oil’s growing supply-side dominance, and US equities continuing on a near-historical run, Darren Sinden – Market Commentator for Admiral Markets – joined Zak Mir and James Hughes in the Tip TV studio to discuss if either of these are coming to an end.

 

Oil and fracking playing a dangerous game of chicken

 

West Texas Intermediate (NYSE: WTI) crude prices are down 20.2% over the past year, but with production being cranked up, and OPEC reaching a 3 year production spike, Darren Sinden believes that oil prices could challenge as low as $25 dollars a barrel in the near future. As fracking starts to challenge the dominant fossil fuel, the response from oil-dependent countries has been an attempt to price them out of the competition, and compensate for overall losses.

 

S&P 500 hinting at a break in trend?

 

While US equities are on a bull-run lasting 2354 days (the 3rd longest run in history), several predictive measures that Sinden highlights are starting to show cracks in the climb. In particular, the percent of stocks from the S&P 500 that are involved in the bull-run has been declining since late 2013. Despite people paying into US indices as a “safe bet”, there’s uncertainty over where the equity market will go next.

 

See more at: Oil prices continue to take hits from multi-factor market pressures, S&P 500 to break lower? | TipTV.co.uk

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China needs a plan B, Fed rate hike remains data dependent

 

Nick “Moose” Batsford, CEO of Tip TV, opened the Tip TV Finance show today on Tuesday 18th August, alongside technical analyst Zak Mir from ShareProphets.com and chief market analyst from eToro James Hughes, to discuss the main headlines including China and rates.

 

China to cause problems for the Fed and for oil

 

Mir highlighted the People’s Bank of China, where he questioned the structure and effectiveness, with only one banker on the policy committee. This led to Hughes’ comment that China is a main issue for the Fed, along with oil, and he reinforces his belief of a 2016 rate hike. He continued that China will also have an effect on oil, with their demand falling with the weakening economy, whilst Mir finished the section by noting that China needs to come up with a plan B.

 

The New York area Empire Manufacturing Survey

 

Batsford outlined that the survey had slumped to minus 14.92 in August from a positive 3.86 in July, which was also the lowest reading since March 2009. With Ms Yellen having informed us the US rate hike would be data dependent, Batsford could therefore comment that the rate hike could be put on hold with this data, depending on this week’s release of the US CPI and FOMC minutes.

 

Gold and the FTSE 100

 

Mir noted that gold is looking a little better with China reminding people that currencies aren’t as reliable, and thus we saw gold rally to March support. When concerning the FTSE 100, Mir commented that the 6515 support area looks like it is holding, but he adds to wait for the range to break, whilst Hughes mentioned that the FTSE 100 is grim, with the potential to be very grim.

 

See more at: China needs a plan B, Fed rate hike remains data dependent | TipTV.co.uk

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China’s slowing economy keeps investors in suspense – safe haven assets are in focus

 

China’s slowing economy keeps investors in suspense – safe haven assets are in focus

China’s Industrial Fall continues to erode confidence in markets – investors are steering clear from excessive bullish activity and switching their focus to safe haven assets.

 

The data on industrial performance released on Sunday fell short of expectations showing only 6.1% growth instead of expected 6.6%. According to the report, the fixed-asset investment figures were also lower than anticipated: 10.9% vs expected 11.2%.

 

China’s weak data had an immediate response in European stocks: STOXX Europe 600 index fell by 0.5% after the start of a trading session. Volkswagen AG experienced another acute fall of 5.5%. Even with their new CEO Matthias Mueller market is too shaky to take this change as a favorable sign. Glencore Plc. shares continue to lose their buying interest with the Iron Ore prices completely seized by bears. Vodafone has plummeted by 3.9 percent after stating that the negotiation with Liberty Global Plc. on exchange assets matter is over.

 

On the flip side there is an increased market appetite to Japanese Yen as a relatively stable currency considered as a safe haven now. On the wave of European stocks decline JPY is strengthening against USD, with USD/JPY heading to new low 119.50 – 120.00 level. Bearish movement on this pair is likely to continue in today’s NY session.

 

 

Source : Tickmill market commentary

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US Indices are following the world economy recover

 

US indices had a gradual rise on Monday with S&P 500 index increasing to 7-week high reaching 2017.46 at yesterday’s session closing.

 

Investors are waiting for the fiscal reports releases from large US companies to see how world economic slowdown affected their returns. Around 35 US firms included in S&P Index will be publishing their return financial data this week, like Intel, Johnson&Johnson, General Electric, Schlumberger and others.

 

According to Bloomberg analysts, companies from S&P Index had their net profit shrunk by 7.2% last quarter comparing to the same period last year.

 

 

“Markets are not under threat if key figures published don’t fall short of forecasts” said Andrew Brenner, market analyst from National Alliance Capital Markets. “Investors suddenly realize that China economic comedown was slightly overstated. Emerging markets are gradually getting over the plunge, with Oil finally changing its long downward trend. This will probably drag indices up as well”

 

On October 12th DJIA rose by 47.37 (0.28%) and reached 17131.86 points.

 

Nasdaq composite increased by 0.17% with 3838.64 points on the session close.

 

As expected EMC, US data storage manufacturer, rose by 1.8% after its merge deal with Dell became known (EMC were bought by Dell for $67 bn.)

 

Source : Tickmill Market Commentary

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Will ECB prolong its QE program?

 

AS ECB meeting is coming, EUR/USD continues to rise on a forecast that EU policymakers will keep up with their QE program, preparing additional measures to give a new impulse for the economy.

 

EUR/USD added 0.04% in London session today rising to $1.1330. Cheap Oil brought a steady deflation on consumer goods so some analysts believe that ECB may expand its program in asset buyout. This program may be extended to September 2016, with monthly buyout volume equal to 60 billion EUR. The meeting regarding this question will be held this Thursday.

 

According to the Chief Analyst of fixed-investment markets of U.S. Bank Wealth Management, Jennifer Wale, ECB will be likely to prolong its program, but the decision can be made no earlier than the December meeting.

 

After the ECB event, FOMC meeting scheduled for 27-28th of October will be in the spotlight. According to the interest rate futures, the odds of Fed’s rate hike in March 2016 are 52%. Fed officials supply public with confusing messages: some of them say that the rate hike could be an appropriate measure for this year.

 

USD Index declined by 0.04% to 94.893, USD/JPY rose by 0.03% to 119.45.

 

We continue to closely monitor ECB and FOMC decisions and update you on the most recent and important economic news.

 

Source : Tickmill Market Commentary

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US increase its Oil reserves, prices suffer

 

US increase its Oil reserves, prices suffer

Oil reserves were increased by 7.1M barrels and reached 473M barrels by the end of last week, reported American Petroleum Institute (API).

 

Although analysts expected the supply increase only by 3.9B barrels, the actual data exceeded the figures twice. Distillate reserves shrunk by 2.6B barrels.

 

WTI fell by 0.89% upon the data from the US with a potential to drop further.

 

DJIA and S&P 500 lost 0.08% and 0.14% yesterday with Asian stocks are struggling to overcome a weak US lead.

 

Source : Tickmill Market Commentary

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EUR/USD is just heading South

 

If you take a look at the latest CFTC report regarding Euro, then you will soon notice that operators continue to build up the short positions on EUR compared to the other market players who are trying to build up the long positions:

 

261015-1en.png

 

It becomes quite clear that it would be wise to expect a drop in the exchange rate of the common currency taking into consideration completely opposite monetary policies of the two central banks.

 

In the daily graph, upstream channel will soon become very interesting to us as we will not only be able to jump off it, but also to break it through:

 

261015-2.png

 

For now we will place a pending order for sale away from the broken down internal uptrend before the EUR touched the upstream channel:

 

261015-3.png

 

 

 

 

Sell Limit 1.1075, Stop Loss 1.1125, Take Profit 1.0925.

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Do traders still believe in rate liftoff in October?

 

 

Most traders completely abandoned their expectations of Fed rate hike this year as world economy continues to slow down.

 

Analysts have the same opinion, Bloomberg survey showed: 63 of market analysts said they shifted their estimates of Fed Rate liftoff to March 2016 and it is very unlikely that it will happen this year. Interest rate futures estimate the odds of October rate increase in just 4% and 34.7% in December.

 

Fiscal policy in China presents yet another obstacle in increasing the costs of borrowing in US which has been kept unchanged from 2006, WSJ says. Last Friday China’s CB lowered its rates on borrowings and deposits, removing the rate cap on all types of bank deposits. Meanwhile Japan reports a drop in exports and ECB continues to fight back with deflation, extending its QE program till September 2016. Macroeconomic data from US were mixed in the past months.

 

Fed’s official, Daniel Tarullo, said he sees an increase of borrowing costs as an unreasonable measure. However some of his colleagues noted that rate hike is still possible if the US economy shows signs of stability.

 

“Bond markets do not believe anymore in Fed rhetorics on rate hike, so Fed is put in a bad box now”, – says Jason Evans co-founder of NineAlpha Capital LP hedge fund.

 

We remind traders that tomorrow on 28th of October at 1pm ET, FOMC will hold its minutes and announce Fed Funds Rate. We advise traders to keep a close watch on these high-impact fundamental releases and manage trading risks properly as market volatility is expected.

 

Source : Tickmill Market Commentary

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Twitter Q4 revenue report may disappoint investors

Twitter revenue forecast for Q4 falls short of estimates because of slowing growth of new users. As a result, shares of the company dropped by almost 13%.

 

Twitter expects its Q4 revenue to reach $695-710M, which is considerably lower than expectations of analysts surveyed by Reuter: $739.7M.

 

Company’s management doesn’t reveal the reason of a decrease in the forecast, but analysts suggest that it is due to the weak growth of new users and Instagram market share increase in mobile ads sector.

 

The number of active users have increased by 4M and totaling 320M, though failed to live up to analysts’ expectations of 324M.

 

New Twitter CEO Jack Dorsey, who took his office in September, undertook significant personnel cut of 300 employees. He said that resources released will be spent on solving other important problems.

 

Twitter shares dropped to $27.38 during the extended trading session then recovering to $31.34 level.

 

 

Source : Tickmill Market Commentary

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Fed rate is untouched, December decision is unclear

US Fed Reserve postpones the decision to hike the rate with insufficient labor data and missing inflation targets.

 

The rate remained unchanged at the level of 0-0.25% and will stay as it is during next two month until it is revised in December.

 

The odds of rate hike in December increased as worries regarding the US being affected by global risks were eased, according to the Fed report. This gives additional cues for traders as stagnating global economy which was mentioned in September report was one of the reasons to postpone the rate hike. FOMC also reported that job creation in US is slowing while jobless rate stays still.

 

“The committee continues to consider the risks of economic activity forecast and labor market balanced”, – reported Fed, which considers US economy grows steady.

 

Majority of committee members expect the rate to rise in 2015 and two of them underscored that weak world growth may harm US economy and keep inflation too low.

 

In the final report Fed officials said that they want to be quite sure that inflation targets of 2% will be met by the end of the year.

 

Market participants expected this decision: 90 analysts surveyed by Bloomberg were convinced that rate will remain on same level. So no severe market response noticed.

 

Source : Tickmill Market Commentary

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GDP data below expectations, domestic consumption saves the US growth

 

Oil prices are falling on release of the US GDP report, which has shown considerable lack of growth of the US economy.

 

According to the report, Q3 GDP growth is 1.5% comparing to more solid 3.9% in Q2. The figure fell short of expectations which predicted growth of 1.6%. Despite strong domestic demand, dollar strength and cheaper gasoline slowed down inflation.

 

Analysts are expecting reduced trading volumes on the eve of China PMI data publication next week.

 

“The guts of the report were healthy, they still show strong underlying momentum in the economy and that puts a December rate hike firmly on the table,” said Thomas Costerg, a US economist at Standard Chartered Bank in New York.

 

The view of Fed on US economy could be described as “satisfactory” according to the FOMC report, US economy is growing at “moderate pace” which leaves food for thought for investors regarding December rate hike.

 

Weak GDP data is caused by a decline in inventories accumulation by US firms with the total of $56.8 billion in Q3 comparing to $113.5 billion in the Q2 period. The decrease included manufacturing, retail and wholesale inventories.

 

Another reason of US growth slowdown is spending cuts in the energy sector. Oil producers are continuing to reduce their spending as cheap Oil prices make it difficult to keep production paying off.

 

We continue to keep an eye on US economic reports as its analysis is crucial for accurate forecast of FOMC decision in December regarding the rate hike.

 

 

Source : Tickmill Market Commentary

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USD drops on weak China manufacturing data

 

 

A drop in China factory activity sends USD way down…

 

Investors are quitting China equities fearing that a slow growth will further increase debt burden of Chinese companies that keep production at the same pace.

 

USDX declined 0.21% to 96.740 while USD/JPY dropped 0.17% to 120.41 level.

 

Official China manufacturing activity report released on Sunday showed a decrease for three months in a row, with manufacturing PMI remaining unchanged at 49.8. The figure released misses the forecast of median 50.0, according to the WSJ’s poll of 11 economists.

 

BoJ announced on Friday that it will keep its QE policy and fiscal rate intact despite the deflation forecast and the country’s slowing down economy.

 

“Someone could be frustrated with the BoJ decision, so the focus is shifted to the Non-Farm Payroll report from US to be released on 6 Nov.”, – Said Kaneo Ogino, CEO of foreign exchange research firm in Tokyo.

 

The Non-Farm employment data to be issued by the US Labor department on Friday will shed some light on the rate hike decision in December. Fed decided to not change the rate in October but it was clear from the report that strong enough macroeconomic data may urge them to increase Dollar borrowing costs.

 

Source : Tickmill Market Commentary

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US indices hit new highs on strong macroeconomic data from EU and China

 

US Indices rose on Monday, with Nasdaq Composite reaching new high for 15 years, writes Bloomberg.

 

Its only 1% left for S&P to hit new peak recorded in May, Dow Jones lacked 2.6% to climb to the new record. DJIA gained 0.94% on November 2nd and totaled 17826.76 points. S&P added 24.69 points (1.19%) and totaled 2104.5 points, while Nasdaq Composite rose 73.4 points (1.45%) and closed at 5127.5.

 

Strong macroeconomic data from Euro zone and US corporate data along with promising figures from China boosted US stock markets.

 

October Purchasing managers Index (PMI) in processing industries published by Chinese agency Caixin and Markit leaps from 47.2 to 48.3 points. Same index published by China National Statistics Bureau remained unchanged and averaged 49.8, missing expectations of analysts surveyed by Bloomberg, who anticipated the rise to 50 points.

 

PMI for manufacturing industries of 18 EU countries rose to 52.3 points, according to the data of Markit Economics. Tentative data showed that the indicator would remain unchanged at the September level of 52 points and analysts surveyed by Bloomberg didn’t expect an abrupt change.

 

Web-retailers Amazon surged 35%, Microsoft 32%, Facebook 24%.

 

This week analysts expect the publication of Q3 data for 100 companies included in the S&P 500 index. From the companies reported their return data, 75% beat expectations, while only 45% to report turnover data which was higher than estimates.

 

Source : Tickmill Market Commentary

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EIA report shows increase in reserves, December rate hike odds are over 50%

 

 

 

EIA report shows increase in reserves, December rate hike odds are over 50%

Market Commentary

November 5, 2015

EIA report shows increase in reserves, December rate hike odds are over 50%

 

Commercial Crude Oil inventories in US rose by 2M barrels and averaged 482.81M barrels, which according to the weekly report released by the US Energy Information Administration “remain near levels not seen for this time of year in at least the last 80 years”.

 

Petrol reserves shrunk by 3M barrels and averaged 215.34M barrels, while distillate reserves reduced by 1.3M barrels reaching 140.757M barrels.

 

The data released hasn’t met the expectations of analysts surveyed by Bloomberg, who expected crude inventories to increase by 2.5M barrels, petrol reserves to decrease by 1.25M barrels and distillates to shrink by 2M barrels.

 

As Fed rate hike odds are past 50% bond yields are increasing across the world. US 10-year Treasuries yields increased to 2.24%, to its seven-week high, pulling up German and Australian bond yields as well.

 

“Bond yields are rising around the world in sympathy with Treasuries,” said Hajime Nagata, a debt money manager in Tokyo at Diam, which oversees $142.6 billion. “The market is reaffirming that the Fed will lift off in December.”

 

We continue to watch closely Fed speeches and Oil market as these are two main indicators traders rely on to forecast the December rate decision.

 

 

Source : Tickmill Market Commentary

 

EUR/Dollar is heading south… on all fronts

EUR/USD

 

For Euro we have broken-down the upstream channel on a day chart:

051115-1.png

 

 

Therefore there is an option to sell EUR from this broken-down flag, or by pacing a limit, or focusing on the candlestick signals:

051115-2.png

 

Sell Limit 1.0930, Stop Loss 1.0980, Take Profit 1.0810.

 

Source : Tickmill market commentary

 

 

Tickmill High Risk Warning. Trading foreign exchange on margin carries a high level of risk, and may not be suitable for everybody. The high degree of leverage can work against you as well as for you.

 

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October Non-farm Payrolls: the key report for December Fed decision

 

Today traders around the world are keeping tab on major US report, released by labor department – Non-Farm Payrolls.

 

October report is especially notable because it is one of the two job-related reports at the US Fed’s disposal for making decision on the US key benchmark in December. The report has outstanding importance as US Fed stays pat on its rate for about a decade (from 2008). Its change could be a token of deep transformations in global economy, to be precise, the end of the “cheap money” age.

 

“Their case for whether or not to go in December could be made or lost with the October employment report,” said Ryan Sweet, a senior economist at Moody’s Analytics Inc.

 

The August US labor data, reporting a reduced number of jobs created, was released together with the Chinese troubles in stock market and talks of a global economy slowdown. In such amount of information one could miss the start of downturn in the US labor market and most probably the October Non-farm Payroll report may reveal a true picture.

 

Non-Farm payrolls hit their peak in 2014 with 260,000 jobs but started to decline with around 200,000 jobs for January-July 2015 period and around 140,000 jobs in August-September.

 

According to the forecast of economists surveyed by Bloomberg, October report will show 180,000 new jobs created, 40,000 more than it was in September.

 

“The book is far from closed on the last few months,” said Conrad DeQuadros, senior economist at RDQ Economics: “It’s not clear that the labor market actually did slow down.”

 

The condition on which Fed would raise its rate is “some further improvement” in US jobs situation. Fed’s Chair Janet Yellen emphasized again that there is a “live possibility” in raising the rate if Non-Farm figures look up.

 

Source : Tickmill market Commentary

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October NFP release beats all expectations

December rate hike possibility surges to 70%

 

The estimates on the pace of the US economy recovery were different from very pessimistic to full hopes. But October NFP report seems to beat them all. Outstanding US Labor data exceeded all expectations of economists surveyed by Bloomberg, who ranged the change from 75,000 to 250,000 increase. Actual number of jobs created in October was 271,000, the biggest from 2009. Unemployment claims declined to the seven years low and averaged only 5%, while hourly earnings increased to the 2008 pre-crisis level.

 

As it might be expected USD added to all majors with EUR/USD tumbled from 1.089 to 1.070 during the NFP release then returning to 1.07660 level.

 

USD/JPY rose from 121.900 to 123.300 level, GBP/USD started to fall from the start of Friday session then plunging to 1.50370 level during the release.

 

US indices such as DJIA, Nasdaq and S&P 500 erased their weekly loss, while US treasures tumbled.

 

The odds of rate hike rose from 56% to 70% after the US non-farm payroll release as signs of recovery that Fed is looking for are obvious now. The assumed effective benchmark is 0.375%.

 

In addition to growth in payrolls and wages, “we’re also seeing a number of other important bellwethers of progress,” Labor Secretary Tom Perez said in a phone interview: “We’re continuing to have the wind at our backs.”

 

The conditions for rate liftoff are becoming very comfortable, the requirement of “one further improvement” in labor market is fully fulfilled and the “live possibility” that Fed’s chair Yellen mentioned last month in her speech, turns to be much more solid than expected.

 

Source : Tickmill Market Commentary

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China deals with deflation trends

 

China continues to struggle with deflation according to the latest CPI release. In October it averaged 1.3% against 1.6% a year earlier. CPI figures have missed the analysts’ forecast predicting a 1.4% rise comparing to the last year.

 

Prices for pork which has significant impact on Chinese inflation have been decreasing in the last months. Prices on main consumer goods rose by 1.15%.

 

PPI index lost 5.9% and maintained a consistent fall for the third month in a row and some analysts see it as a deflationary trend in this sector.

 

Source : Tickmill Market Commentary

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Crude reserves increase in the US

 

The report released by the American Petroleum Institute indicates that crude inventories increased by 6.3M bbl. and averaged 486.1M bbl. on the week ending on November 6th.

 

According to API data, gasoline reserves declined by 3.2M bbl.

 

Analysts’ estimates saw crude inventories rising by only 1M bbl., petrol supply shrinking by 800,000 bbl., and distillates – by 900,000 bbl.

 

Oil prices responded on the spot, WTI price declined by 1% waving around 43.70 level, Brent declined by 0.5% to 47.19 at the time of publication.

 

China retail sales rise

 

Macroeconomic data released in China shows that transformation of the economy model from industrially-driven to consumption-oriented has been already set on.

 

Industrial output rose by poor 5.6%, the weakest from 2008 crisis, while retail sales surged by 11% in October, the biggest gain this year.

 

“China’s economy is still in a downward trend, weighed by both domestic and international pressures,” said Xia Le, a Hong Kong-based economist at Banco Bilbao Vizcaya Argentaria SA: “Financial market volatility has impacted the real economy and it’s more difficult for companies, especially manufacturers, to obtain financing.”

 

Source : Tickmill Market Commentary

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Oil prices are pressured again with US building up crude inventories

 

Oil prices fell to the lowest level for two months after EIA’s release showed that US keeps up accumulating crude reserves.

 

WTI declined by 0.34% and currently trading at 41.61 level, while Brent gained 0.23% against USD and now waves around 44.10 level.

 

According to Energy Information Administration (EIA) reports, crude inventories rose by 4.2M barrels exceeding the expectations of only 1M barrels increase.

 

“Market plunged on the negative impact from record high crude inventories and output increase”, – said in PhillipFutures analytical report.

 

Analysts have different views on Oil market oversupply, ranging from 0.7M to 2.5M barrels daily. On Thursday, OPEC reported a decrease of oil output in October and also anticipates sharp cut in Oil extraction next year, first from 2007.

 

“It is not likely to see Oil prices rising at the end of this year, as strengthening Dollar and emerging markets issues present a serious hurdle for that”, – said in ANZ bank report.

 

Last month there was a substantial increase of put options for Oil prices ranging from $40 to $25 in the period from December 2015 to June 2016. It indicates that traders are getting ready for further crash in Oil prices in the first half of next year.

 

Source : Tickmill Market Commentary

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Paris killing: will the market shock be short-term or extend for some more?

Paris massacre happened at night on November 14th and caused a short-term shock on financial markets with few analysts expecting that the impact could be dragged out. US and UK stocks suffered the most but recovered very soon: DJIA +0.22%, S&P500 +0.26%, DAX +0.45%, FTSE 100 +0.21% at the time of release.

 

French government decided to close the country’s borders as a security measure, striking a crushing blow against tourism and travel sector companies. This sector being the weighty part and accounting for almost 7.5% of GDP could lead to a far-reaching repercussions on French economy which probably have already started to worry ECB considering the extension of its easing program in December.

 

EUR/USD responded by a short drop from 1.0737 to 1.0700 recovering in late Asian session. Further EUR and EU markets strengthening is questioned and depends on how soon travel restrictions will be lifted in France.

 

“These Paris terrorist attacks and the larger scale of this attack could have a meaningful negative impact on the travel and tourism sector,” said Robert T. Lutts, chief investment officer at Cabot Wealth Management in Salem, Massachusetts.

 

With talks resuming to intensify military intervention in Syria, Defense sector may get another boost. Its performance beats US equities and has good potential to rise this week. “The prospect of more military action in Syria may help defense group in the week ahead,” said Nicholas Colas, chief market strategist at the ConvergEx Group in New York.

 

The fact that the event happened on weekend had mild effect on markets preventing a big chaos. “If this had happened during market trading hours there could have been a panic but markets had a weekend to digest all the information,” said Eiji Kinouchi, chief technical analyst at Daiwa Securities in Tokyo.

 

We express condolences to all victims of this cruel crime against humanity and continue to watch for aftermath of the incident on the markets.

 

Stay Tunde With Tickmill Market Commentary to get lastest update from the markets

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Dollar rises on the expectations of strong inflation data from the US

Dollar is strengthening today against other ten major currencies in the expectation of October Inflation data from the US, reports Bloomberg.

 

According to the CFTC COT report, hedge funds and other big market players sharply ramped up their long net positions for the last three weeks.

 

CPI report showed an increase of 0.2% comparing to the previous month and added 0.1% comparing to same month in 2014. CPI Core report which doesn’t include food and utilities, as expected, averaged 0.2% and 1.9% respectively.

Inflation data will be released by the Labor department today at 13:30 GMT.

 

Spot index which indicates changes in USD value against 10 other major currencies rose by 0.2% to 99.589 today. It hit its peak of 99.605 during today’s session – the highest from April 14th.

 

EUR/USD slipped further to 1.0660 at 06:15 GMT comparing to 1.0686 at yesterday’s closing time.

 

USD also appreciated against JPY and rose to 123.41 comparing to 123.18 at yesterday’s closing time.

 

EUR slightly plummeted against JPY to 131.55 comparing to 131.63 of yesterday’s closing time.

 

Stay Tuned with Tickmill Market Commentaries

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EIA report finally sends Oil prices up

 

Wednesday EIA release rescued Oil price from further nosedive with US reducing its crude inventories. However, analysts rule out the possibility of their appreciable rise in the first half of 2016.

 

According to EIA report, Crude reserves shrunk by 482,000 bbl., showing a substantial contradiction to the 1.9M bbl. increase estimate. Figures became a long-awaited signal for Oil bears boosting WTI by 1.30% to $41.20 and Brent by 1.70% to $44.32/bbl. at the time of this release.

 

Analysts warn that Oil excess still remains on the market and makes it impossible for the commodity prices to backtrack. According to the Energy Aspects report: “Market sentiments are deeply pessimistic right now. There are talks about $20 for a barrel”.

 

The cause of depression is Oil supply which exceeds the demand by 0.7-2.5M bbl. daily according to different estimates. Crude storages on land are almost full and storing Oil in tankers makes sense only when future contracts are high. Oil futures with delivery on January 2017 are traded $6 higher than January 2016 contracts which is not a sufficient markup for Oil ship storages.

 

Rising concerns about Chinese energy demand shakes almost all commodity markets with copper prices dropping to 16-years low on Wednesday. And Oil is no exception…

 

Stay tuned with Tickmill Market Commentary

 

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December rate hike odds give bullish sentiments to US stocks

 

US stocks rose on Wednesday and investors became favorably inclined towards December rate hike as October protocols showed that majority of FOMC members are ready to support it.

 

Committee participants also expressed concerns that a long-term outlook of the economy potential appears to be not so bright.

 

“I think that market is ready for US key benchmark rise” – said Allan Rechtschaffen, UBS Wealth Management Americas analyst in New York.

 

DJIA gained 1.42% to 17,737.16 points, S&P rose 1.62% to 2,083.58 points, Nasdaq Composite added 1.79% to 5,075.20 points.

 

Some investors express confidence in December key liftoff but have different views on its further dynamics.

 

Meanwhile, Apple shares hiked by 3.2% to $117.29 after Goldman Sachs included the mobile phone manufacturer in its list of “buy” companies, saying that its shares have a potential of 43% rise over its current level.

 

Stay tuned with Tickmill Market Commentary

 

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Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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