Equities
On
Wednesday global stocks rallied on hopes of a Democratic victory in the US
elections could mean more federal spending to boost the economy, as the recent polls
have favored the Democratic candidate Joe Biden against President Trump.
The
Federal reserve minutes reflected member’s concerns about the delay in passing
the new fiscal spending bill and hinted that the central bank may consider
increasing its current bond purchasing program. Members have agreed that the US
economy’s recovery would be dependent on the coronavirus course and according
to the Fed member Evans, investors still believe that the Fed would not change the
interest rate until reaching full employment and inflation seem to overshoot
its 2.0% target which may take years.
|
Change % | |
|
+2.0% | |
|
+2.1% | |
|
+2.1% | |
|
+0.9% | |
|
+1.3% | |
|
+0.8 % | |
|
+0.9% |
Currencies
The greenback slipped on Wednesday by 0.2% yet the bullish
uptrend still intact while above the neckline of the inverted head and
shoulders pattern located on Thursday at 93.33. Therefore, a daily close above
94.04 could send the US Dollar index towards 95.24.
On the other hand, the EUR/USD rallied on Wednesday
however, remained below the 50-day moving average highlighting the bull's
weakness. A close below 1.1713 could send the pair towards 1.1621.
The GBP/USD has benefited from the US dollar
retreat and tested this week the 1.3000 level for the first time in three
weeks. However, the EU/UK negotiations updates next week could weigh heavily on
the British pound as the UK may pull out of the talks if there was no clear deal in sight.
Commodities
The oil price rallied on Wednesday as US inventories numbers
showed a big drop from 1.78 M to 0.47M. However, the surge in COVID-19
infections in New York (three months high) kept the rally in check. The Brent oil remained around $42.50 yet a failure
to close above that level could reverse the price direction towards $39.60
while the US Crude may fall towards $38.37 while below
the 50-day moving average.
The Gold price failed to close above $1,921
and pointed lower this week. The precious metal could resume bearish price
action if closes below $1,861.
Looking Ahead
The ECB monetary policy meeting accounts will be released at
3:30 PM (UAE time) and by 4:30 PM eyes will be on the US initial jobless
claims, then the Fed member Barkin will deliver a speech at 10:30 PM.
