Your morning market update as the weekend looms. Try to stay focused.
– US markets were closed for Thanksgiving which took a lot of the impetus out of markets but there was still big news with the Nikkei up strongly again in Japan on the back of the weak yen and expectations it will weaken further.
– But probably the biggest news overnight was the pre-emptive strike by the Bank of England to try to take some heat out of the UK housing market and to ensure there is no bubble. On this front, the extraordinary support that was being provided to the market via the “Funding for Lending Scheme” which was used to encourage banks to start lending for mortgages. Rather the BoE is looking to repoint banks toward small business lenders.
– As a result, sterling popped and sits at 1.6340 this morning, up 0.33% but well up on the low of the day at 1.6275. The FTSE didn’t fare so well – it was up 30-odd points at one stage with a high of 6,680 before the announcement but it ended up just 0.07% at 6,654.
– Elsewhere in Europe, consumer confidence rose to 15.4 from -15.4 expected which is a huge miss from the punditry. EU business climate was up slightly to 0.18 from -0.08 and sentiment and confidence were better than expected. In Germany CPI data was also out and showed a year-on-year rate of 1.3% slightly above the 1.2%. In the end, the DAX was 0.38% higher, the CAC up 0.21% while Milan and Madrid had a much stronger day, up 0.92% and 0.53% respectively.
– On the ASX overnight, Dec Spi futures at 7.31am AEDT are up 2 points to 5354 bid. The Dec 3-year is up 1 point at 96.89 and the 10’s are up 1 point to 95.815.
– On Forex markets, the Aussie dollar recovered off the 90.60ish low pre-Capex data yesterday to rally all the way to a high overnight of 0.9149 and it sits at 0.9110 this morning. Euro is holding above 1.36 just at 1.3602 and USDJPY is at 1.0222 this morning.
– On commodities, Bitcoin is at $1143 off a new all-time high of $1224 as the mania continues – call me cynical but the traders of the early 19th century would be so proud of the corner that is being run in Bitcoins at the moment. Nymex crude is closing in on that very important technical level at $91.32 Bbl and it rests at $92.25. Gold is largely unchanged in the mid-$1240 region and sits at $1244.50 this morning. Silver sits at $19.68 oz and Copper is at $3.22 lb.
Trading on the NYSE is going to finish at 1pm so it is also likely to be a quiet, post-holiday trading day to end the week.
Before that though, we see South Korean industrial output, Japanese CPI, unemployment and industrial production. In Australia, Private Sector Credit is out and it will be interesting to see if there is any pick-up in demand for debt or if Australian’s appetite for paying off their loans continues to swamp new lending. House prices are out tonight in the UK which the BoE will be watching.
In Europe, we get retail sales in Germany, mortgage approvals in the UK, EU CPI, Italian CPI and the EU unemployment rate. Indian GDP and Canadian GDP are also out late tonight.
Nothing in the US.