General Market Comment
US indices closed mixed on Thursday. Shares in the Consumer Durables & Apparel (-1.96%), Automobiles & Components (-1.65%) and Transportation (-1.23%) sectors ended in the red zone while shares in the Household & Personal Products (+2.13%), Utilities (+0.88%) and Consumer Services (+0.72%) sectors gained traction. On the economic data front, initial jobless claims declined to 206k in week ended December 8th (estimated 226k) from 233k in the previous week. Continuing claims reached 1.661M in week ended December 1st (forecasted 1.649M) compared to 1.636M a week earlier. In other news, the Bloomberg consumer comfort index declined to 59.4 in week ended December 9th vs. 60.3 in the prior week. Import price index decreased by 1.6% in November (estimated -1%) from an improvement of 0.5% in October. Finally, the monthly deficit dug deeper to $204.9B in November (expected $199B) vs. $100.5B a month earlier. The S&P 500 (2,650.54) remains below its 20d moving average (2,688.80 – negative slope) and 50d moving average (2,736.02 – negative slope).
European markets are expected to open on a negative note.
Foreign Exchange
The US dollar was mixed against its major pair on Thursday. On the economic data front, initial jobless claims declined to 206k in week ended December 8th (estimated 226k) from 233k in the previous week. Continuing claims reached 1.661M in week ended December 1st (forecasted 1.649M) compared to 1.636M a week earlier. In other news, the Bloomberg consumer comfort index declined to 59.4 in week ended December 9th vs. 60.3 in the prior week. Import price index decreased by 1.6% in November (estimated -1%) from an improvement of 0.5% in October. Finally, the monthly deficit dug deeper to $204.9B in November (expected $199B) vs. $100.5B a month earlier.
The Euro was bearish against most of its major pairs with the exception of the JPY. The ECB kept its main refinancing rate at 0%, as expected. It “expects the key ECB interest rates to remain at their present levels at least through the summer of 2019”. It confirmed “the net purchases under the asset purchase programme (APP) will end in December 2018.” Finally, the ECB “intends to continue reinvesting, in full, the principal payments from maturing securities purchased under the APP for an extended period of time past the date when it starts raising the key ECB interest rates”.
The Australian dollar was higher against most of its major pairs with the exception of the GBP.
Commodities
After the close of Wall Street, WTI Crude Future (JAN 19) was up $2 to $53.11. The contract was above its 20D MA (@ $52.75) and below its 50D MA (@ $61.26).
Gold was down $2.9 to $1242.8. The precious metal was above its 20D MA (@ $1231) and above its 50D MA (@ $1224).
Copper Future (MAR 19) on Comex was about flat to 276.7c/lb. The contract was below its 20D MA (@ 277.54c) and below its 50D MA (@ 277.17c). In Europe, the London Metal Exchange reported its copper inventories increased 75 tons to 119975 tons.