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XTB TRADEBEAT

Stocks continue to rally; USD on firm footing ahead of NFP

Summary:

  • US stock indices make another record high
  • SPA35 bounces strongly after recent decline 
  • USD gains on solid economic data
  • ECB minutes have little impact on the Euro

Another day, another record for US stocks. The remarkable rise in the stock market across the Atlantic is showing little sign of letting up with today seeing all-time peaks made in the US500, US100 and US30. The Wall Street open saw the S&P500 open at its highest ever level and should we see a higher close tonight, it will mark 8 consecutive days of gains. This would match the longest successive winning streak for the market since 1997 and provides further evidence as to how strong the current upside momentum has been.

Following reports that Catalan leaders are divided on how best to proceed following Sunday’s referendum has provided a boost to the SPA35, which spiked higher on the news. According to two people familiar with the plan, Catalan separatists are trying to find a way to put off a definitive declaration of independence to create space for a negotiated settlement with Spain. 

The afternoon session was relatively light on the data front with the release of initial jobless claims arguably the stand out. For the 3rd occasion out of the last 4 the weekly employment figures have come in better than expected, with today’s release showing 260k compared to a consensus forecast of 266k and a prior reading of 272k. Durable goods orders were also pleasing, in rising to 2.0% Y/Y compared to 1.7% expected and with the core element also rising the steady uptrend seen since the beginning of 2016 remains in tact. 

Closer to home the account from the latest ECB’s meeting in September revealed similar remarks we’d already known. The bank opened a discussion over the pace and the duration of the asset purchase program as it had been suggested during the press conference last month. With no real fresh developments here the Euro saw little by the way of a reaction and is fairly mixed on the day. 

The pound is the worst performer out of all the majors so far today, with the currency sliding across the board. The GBPJPY is the biggest faller with the pair falling back to the 148 handle and lower by almost a percent on the day. However, A look at the money markets suggests that this latest weakness may be overdone.

All major cryptocurrencies have approached curious technical levels which could be worth looking at going forward, Dash is among them. The price of Dash has almost touched a bullish trend line which has served as a springboard for buyers since the summer months. Thus, there is a possibility that bulls could gain a foothold in the vicinity of that area yet again.

Looking ahead the focus going into the weekend will likely be on tomorrow’s non-farm payrolls (NFP) report. The NFP is traditionally the most anticipated monthly report from the US economy and arguably the most traded report on the financial markets. Expectations are low due to the damage inflicted by the recent Hurricanes in the US with just 90k jobs expected to have been added throughout September

 

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