The Nymex crude oil futures market has sold off at mid-week, after prices hit a six-week high on Monday. Importantly, a price uptrend line on the daily chart has been negated, to now suggest crude oil prices will trade sideways-at-best in the near term, if not sideways to lower. Stay tuned!–Jim
Daily Morning Report
FOMC Minutes On Deck Wednesday P.M.
Wednesday, November 20–Jim Wyckoff’s Morning Markets Report
Asian and European stock markets were weaker overnight and the U.S. stock indexes are pointed toward lower openings when the New York day session begins. There is an uptick in risk aversion at mid-week following comments from President Trump Tuesday, when he said the U.S. could slap more trade tariffs on China. The U.S. Congress is also contemplating passing a resolution in support of Hong Kong’s protesters. And there are ongoing reports coming out of China that no trade deal would be agreed upon by China unless the U.S. lifts all of its tariffs on China’s imports into the U.S. Trump could impose more tariffs on Chinese goods as soon as December 15.
In overnight news, China’s central bank again eased its monetary policy just a bit by lowering its one-year-loan prime rate to 4.15% from 4.2%. The five-year-loan rate was lowered from 4.85% to 4.80%. That’s the second lowering of interest rates this week by the People’s Bank of China.
There was another dour inflation report coming out of the Euro zone Wednesday. The German producer price index for October fell 0.6%, year-on-year, suggesting very low inflation remains a serious problem for the Euro zone.
The U.S. economic data point of the week is Wednesday afternoon’s minutes from the last meeting of the Federal Reserve’s Open Market Committee (FOMC). Traders will be parsing the minutes for clues on the timing of the next monetary policy move by the Fed.
The key “outside markets” today see the U.S. dollar index higher. Nymex crude oil prices are slightly up and trading around $55.35 a barrel.
Other U.S. economic data due for release Wednesday includes the weekly mortgage applications survey and the weekly DOE liquid energy stocks report.
–Jim
Asian Markets More Worried About Hong Kong Unrest
Tuesday, November 19–Jim Wyckoff’s Morning Markets Report
Asian and European stock indexes mixed overnight. U.S. stock indexes are pointed toward firmer openings and new record highs when the New York day session begins.
Focus of traders and investors is turning more to the civil unrest in Hong Kong, which is becoming more widespread and violent, and is bearish for Asian stock markets. Also, it appears mainland China government officials and Hong Kong officials are becoming more at odds on dealing with the protesting. Hong Kong has been a major business hub for years, but the protests in the streets are making the world’s businesses leery of dealing in Hong Kong.
In other overnight news, China’s central bank slightly lowered its short-term repo rate Tuesday, and the People’s Bank of China governor said he will continue to work to lower real lending rates, as the government continues to work to stem the negative economic effects of its trade war with the U.S.
More details emerged overnight regarding President Trump’s meeting with Fed Chairman Powell on Monday morning. Trump late Monday tweeted that he told Powell U.S. interest rates are too high and that U.S. rates should be “lower than all others.” Trump in his tweet also said the U.S. dollar is too strong.
The key “outside markets” today see the U.S. dollar index slightly higher. Nymex crude oil prices are lower and trading around $56.50 a barrel.
U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, and new residential construction.
–Jim
Gold Prices Trending Down, Bears Have Edge
The gold futures market sees prices trending lower and the bears have the slight near-term technical advantage. Bulls need to close their yellow metal’s price back above strong psychological resistance at $1,500.00 to provide them with some technical strength to then suggest a price uptrend might be restarted. Stay tuned!–Jim
U.S. Stock Indexes Poke to New Record Highs Monday
Monday, November 18–Jim Wyckoff’s Morning Markets Report
Asian and European stock indexes were flat to firmer overnight. U.S. stock indexes are pointed toward modestly higher openings and new record highs when the New York day session begins. Trader and investor risk appetite is generally upbeat to start the trading week, amid no major geopolitical concerns at the moment.
The ongoing U.S.-China trade negotiations appear to be progressing a bit, as there has been no negative rhetoric coming from either side in recent days. However, there have been no reports of any significant breakthroughs on sticking points, either.
In overnight news, China’s central bank eased its monetary policy again Monday by lowering its reverse repurchasing rate for the first time since 2015. The trade war with the U.S. has hurt China’s economy and the central bank is working to keep it stimulated.
Hong Kong civil unrest remains elevated and the world marketplace continues to monitor the situation.
The key “outside markets” today see the U.S. dollar index slightly lower. Nymex crude oil prices are also weaker and trading around $57.50 a barrel.
U.S. economic data due for release Monday includes the NAHB housing index, and Treasury international capital data. The U.S. data point of the week will be the FOMC minutes reports release on Wednesday afternoon.
–Jim
Big U.S. Data Day Friday to Likely Impact Markets
Friday, November 15–Jim Wyckoff’s Morning Markets Report
Asian and European stock indexes were mostly higher overnight. U.S. stock indexes are pointed toward modestly higher openings and at new record highs when the New York day session begins. Trader and investor risk appetite is a bit more robust to end the trading week. It’s been another up-and-down week regarding progress, or lack thereof, in U.S.-China trade negotiations. A Barron’s headline Friday warned that investors should be less worried about U.S.-China trade talks and more concerned about recent data pointing to a significant slowdown in China’s economic growth.
Hong Kong reported its gross domestic product down 2.9% in the third quarter, from the same period last year. The city expects its GDP to decline by 1.3% in 2019—the first annual decline in 10 years. Civil unrest in the city much of this year has hurt Hong Kong’s economic growth, as well as rattled Asian stock markets.
In other overnight news Friday, the Eurozone October consumer price index rose 0.1% from September and was up 0.7%, year-on-year.
The key “outside markets” today see the U.S. dollar index slightly lower. Nymex crude oil prices are weaker and trading around $56.50 a barrel.
It’s a very busy Friday for U.S. economic data released, including the Empire State manufacturing survey, retail sales, import and export prices, industrial production and capacity utilization, and manufacturing and trade inventories.
–Jim