Major US indices gave up partial gains as the optimism from the trade agreement between China and the United States faded. Investors are monitoring closely the US Treasury yields as a yield curve inversions provide early signs to detect a recession. The Dow Jones Industrial Average earned 0.9% to 25824, the S&P500 gained 0.1% to 2791, and the Nasdaq futures rose 0.2% to 7054.
The dollar index which measures the greenback against a basket of major currencies fell 0.2% to settle at 96.95, weighed down by the possibility of a pause in Fed's rate hike. The Federal Reserve Chairman Jerome Powell announced last week that interest rates are "just below" the neutral level. His comments lowered the chances of a multiple interest rate hike in 2019 and drove the Treasury yields lower. The US 10-year yields fell to an eleven-week low of 2.94%, and the difference between the 2-year and 10-year yields declined to the lowest since 2007. Moreover, the curve between the 3-year and 5-year yields inverted for the first time since 2007. Such incidents hint that there could be a recession ahead which will force the Fed to rethink their rate hike plans. The USDJPY lost 0.5% to 113.06, and the EURUSD rose 0.3% to $1.1390.
Metals prices strengthened as the dollar tumbled along with Treasury yields. The gold ounce price climbed 0.6% to $1237, and the silver ounce price appreciated 1% to $14.51.
Oil prices advanced on expectations that OPEC and Russia will cut supply in the upcoming meeting on December 6. Moreover, the prices earned support from the optimism of a trade deal between China and the United States which could boost the global economy. The West Texas Intermediate crude futures added 4.8% to $53.06, and the Brent futures jumped 4.6% to $61.80. The American Petroleum Institute will report the weekly crude oil stock later today.
Major Economic Events
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