Spreads
Spreads
Spreads
Spreads
Spreads
U.S. equities continued to march higher over the course of Tuesday’s trading. During his scheduled speech at the Swiss Riksbank, Fed chair Jerome Powell kept muted about the Fed’s upcoming monetary policy directions.
Market participants thus interpreted the muted response as a positive sign for equities; furthermore, the upcoming CPI report, scheduled for Thursday’s American trading session, is widely predicted to come in softer than expected. The Dow Jones Industrial Average gained 0.56% to close at 33704.1. The S&P 500 climbed 0.7% to close at 3919.25. The tech-heavy Nasdaq Composite gained 1.01% to close at 10742.63.
The benchmark 10-year U.S. treasury yield slipped 13 basis points to close at 3.606%, while the short-term 2-year yield ended the day at 4.245%.
The recent equity market rally, which began on the 6th, extended into its third trading day. Market participants are aided by the weakening Dollar and betting on a possible decrease in the Fed’s interest rate hike pace; however, as mid-January and late January roll around the corner, so is earnings season for major corporations. Fiscal 2022 Q4 earnings are expected to be lower than previous quarters as corporations begin to feel the pain of the consecutive 75 basis point interest rate hikes.
Main Pairs Movement
The Dollar index, which tracks the U.S. Greenback against a basket of major foreign currencies, has continued to decline for the third straight day. Market participants are bidding down the Dollar as they expect the Thursday U.S. CPI report to come in softer than expected. However, market participants should be aware that during his speech at Sweden’s Riksbank, Fed chair Jerome Powell noted that the Fed might need to make an “unpopular decision” to further bring down prices to the targeted 2% inflation rate.
EURUSD climbed 0.05% over the course of Tuesday’s trading. Range-bound trading for the pair is expected prior to Thursday’s major economic data release.
GBPUSD retreated 0.27% over the course of yesterday’s trading, despite a weaker Dollar. Thursday and Friday could be volatile for Cable as major economic data will be released by the two nations.
Gold climbed 0.28% over the course of Tuesday’s trading. The Dollar denominated Gold has continued to climb for the third straight day and now faces a key price level of $1870 per ounce.
Economic Data
| Currency | Data | Time (GMT + 8) | Forecast |
| AUD | Retail Sales (MoM) (Nov) | 08:30 | 0.6% |
| USD | Crude Oil Inventories | 22:30 | -2.243M |
