Over the weekend, traders were eager to see whether the US Dollar remained within its new pricing after the latest inflation figures. The US Dollar Index over the past 24 hours has mainly remained below 107.00 and has not shown any sign of a change in trend so far. The only currency pair which has moved in favor of the US Dollar has been the USD/JPY.
Most investors are following one of the latest developments related to the G-20 meeting in Bali and the ongoing Midterms. Traders also continue to follow the breakdown of FTX, which seems like history again repeating itself, as the overall scenario looks very similar to the downturn of the Lehman Brothers.
Investors wanted to see something from the G-20 meeting: a sense of stability and security rather than a “Cold War” sentiment that has surrounded the global economy over the past 11 months. Investors seem to have positively reacted to the agreement between both Biden and Xi to release statements of friendship, and both condemned nuclear war. We can see the positive reaction amongst global stocks, including Asian and European Indices.
This morning, investors have also focused on the employment figures released in the UK. The Bank of England has clarified that they are looking for the UK employment market to weaken to stabilize inflation. The UK Unemployment Rate has increased from 3.5% to 3.6%, and so far GBP/USD has positively reacted. The GBP was also supported by a lower-than-expected Claim Count Change, which was significantly lower.
Nasdaq - Technical View
The Nasdaq 100 futures this morning rose during the futures market by 0.57% after ending the day yesterday with a minor loss. Generally speaking, the Nasdaq has maintained its value after Thursday’s substantial price spike, and the price has remained above all Moving Averages. As mentioned above, the price has also been supported by the positive comments from the latest Xi-Biden meeting, which lasted over 3-hours.
The Tech Sector in the US continues to advise that they believe sales and economic activity is likely to slow in the coming months. The prediction has led to many companies deciding to lower their employment force, with the latest being Amazon (Nasdaq:AMZN) yesterday evening. According to reports, Amazon (NASDAQ:AMZN) may look to offload 3% of its overall workforce, which is approximately 10,000. This should support the company’s profits, especially if consumer demand continues to surprise markets.
Investors also continue to monitor the developments surrounding the Federal Reserve and its monetary policy. On Sunday night, one of the Fed’s Governors, Christopher Waller, advised markets that a lower interest rate decision cannot be known unless the US sees another similar decline in December.
The US inflation rate declined by 0.5% during October. Therefore, the Fed will look for inflation to decline to 7.2-7.3% during November. Currently, the market is pricing in a 50 basis point hike. Stock investors and US Dollar traders will look to this afternoon’s scheduled economic releases. The US is expected to release its PPI, which is expected to remain at 0.4%. In addition, investors will also monitor the Empire State Manufacturing Index.