The dollar rose. There is a movement in the market to confirm the monetary policy direction of the Federal Reserve Board (Fed) and the policies of President-elect Donald Trump.
The dollar index against major currencies rose 0.52% to 106.65 in late trade. The dollar/yen exchange rate rose 0.43% to 155.31 yen. The euro/dollar exchange rate fell 0.5% to $1.0542.
The dollar index has risen about 3% since the US presidential election. The dollar has been supported by the growing perception that Trump’s policies will lead to a revival of inflation and that the Fed’s rate cuts will be slower.
In the short-term money market, the outlook for Fed interest rate cuts has dimmed. According to CME FedWatch, there is a 52% chance of a 0.25 percentage point rate cut at the December meeting, down from 82.5% a week ago.
Jay Hatfield, CEO of Infrastructure Capital Advisors (New York), said, “Japan is an exception, but many countries around the world have no choice but to cut interest rates.” wide
NY Foreign Exchange Market:
Government bond yields rose. It was disappointing that the US Treasury confirmed weak demand in the 20-year government bond auction held on the same day.
Traders are waiting to see when the Fed will stop its rate cutting cycle. Market participants are now awaiting President Trump’s policies and signals that could affect the Federal Reserve’s monetary policy.
“It looks like we’ll have to wait until the next nonfarm payrolls and consumer price index release,” said Michael Lorizio, head of U.S. rates trading at Manulife Investment Management.
Two members of the Federal Reserve Board expressed conflicting views on the future of monetary policy on the 20th.
Traders expect a 55% chance the Fed will cut interest rates by 25 basis points in December, according to CME Group FedWatch. We see only a 15% chance of another 25bp rate cut in January.
Demand for today’s $16 billion 20-year bond auction was weak, with the yield peaking at 4.680%, about 3 basis points higher than pre-offer trading. The application ratio was 2.34 times, the lowest since August 2022.
“The weak claims further strengthened the bear market,” said Kim Rupert, managing director of fixed income at Action Economics.
The yield on 10-year government bonds rose 3.3 basis points to 4.412%.
The two-year bond yield rose 3.6 basis points to 4.308%. The yield gap between 2-year and 10-year bonds narrowed to 10.4 basis points.
Mi Financial Bond Market ・:
“Growth stocks and the technology sector were strong yesterday, but today they are a bit more defensive,” said James Regan, head of wealth management research at DA Davidson.
“This could be a cautious view ahead of Nvidia’s financial results, or a general view of Target’s financial results. Geopolitical concerns are also increasing, such as tensions between Ukraine and Russia and the closing of the US embassy.
US stock market:
Gold futures rose for the third day in a row due to continued buying of gold as a safe-haven asset against the increasingly tense situation in Ukraine. The settlement price (equal to the closing price) of the mid-December contract was $2,651.70 per ounce, up $20.70 (0.79%) from the previous day.
NY Precious Metals:
Prices fell for the first time in three business days due to a bigger-than-expected increase in US crude oil inventories. The settlement price (equal to the closing price) of the main US WTI oil contract for December was $68.87 per barrel, down $0.52 (0.75%) from the previous day. The January contract fell $0.49 to $68.75.
Weekly inventory statistics released by the US Energy Information Administration (EIA) this morning showed that crude oil inventories increased by 500,000 barrels from the previous week, while gasoline inventories increased by 2.1 million barrels, both of which were much more than was expected. This stimulated awareness of the slowness of supply and demand, and sales of crude oil increased dramatically. On the other hand, there were deep supply concerns due to rising geopolitical tensions, and there were times when the market moved into positive territory.
NYMEX Energy:
This is a provisional value based on LSEG data. The previous day’s ratio may not match
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2024-11-20 23:15:00
#Market #Summary #20th #Dollar #rises #yields #rise #stocks #mixed
How might investors adjust their portfolios in response to the rising gold prices amid increasing geopolitical tensions?
1. What factors contributed to the mixed performance of stocks in the US market on the 20th, with some sectors like growth stocks and related stocks experiencing declines while others, such as energy, saw gains?
2. Why did gold prices rise for the third consecutive day, and how does this trend relate to increasing geopolitical tensions?
3. How did the release of the weekly inventory statistics by the EIA impact the price of crude oil, and what are the implications of these findings for the broader energy market?
4. Could you provide further insight into the underlying dynamics driving the movement of the dollar and the effect of rising yields on investor sentiment?
5. In light of these market trends, what strategies might investors consider to navigate the current market environment, given the interplay between various asset classes and geopolitical factors?
