To the scoreboard:
Dow: 23,434.19 +33.33 (+0.14%)
S&P 500: 2,581.07 +20.67 (+0.81%)
AUD/USD: 0.7677 +0.0017 (+0.22%)
ASX200 SPI futures (December contracts): 5,921 (+34)
1. Euro sell-off continues: Another 0.4% fall against the USD saw the Euro dip by 1.8% over the last two days of the week, hitting its lowest level since July at just above $US1.16. The moves followed the ECB’s dovish announcement for the tapering of its bond purchasing program, as well as continued political tensions in Spain.
2. Tech stocks storm ahead: The S&P500 closed the week at yet another record, and the tech-focused NASDAQ posted its best one-day gain this year of 2.2% as Amazon, Microsoft and Google all smashed Q3 earnings estimates. Stock market sentiment also would’ve been helped by the first reading of US Q3 GDP which easily beat expectations despite the impact of September hurricanes.
3. Bonds hold steady: Benchmark 10-year US treasury yields rose as high as 2.48% before closing at 2.42% on news that Jerome Powell had emerged as the front-runner to become the new Fed chair. The development also put downward pressure on the US dollar. Powell is viewed as slightly more dovish than Stanford economist John Taylor, who’s considered the other main candidate.
4. AUD bounces off its lows: The Aussie dollar caught a bid in overnight trade on Friday, after falling as low as 0.7626 US cents in the wake of the High Court’s citizenship announcement. It subsequently climbed back in the wake of Powell’s emergence to finish the week at 0.7677 — still down 1.7% for the week after Wednesday’s data on quarterly inflation growth missed expectations.
5. The week ahead: Domestic data will be led by building approvals data on Tuesday and September retail sales figures on Thursday. A busy international calendar kicks of with a key reading of US inflation tonight, ahead of the US Fed’s November interest rate announcement on Wednesday night. The full calendar is here.
6. Oil climbs above $US60: Benchmark crude hit its highest level in over two years to close at $US60.44 a barrel, up 4.9% for the week as markets assess the impact of further OPEC supply-cut extensions. It was a different story for iron ore, which fell by 3.8% ahead of winter production cuts in China. In base metals, copper fell sharply from its recent three-year high while gold rose off a three-week low to close at $US1,274 an ounce.
Enjoy your day, I’m on Twitter @Mr_SamJacobs.