News

Trump-XI Meeting Sparks Investors' Risk Appetite

Equities

Major US stock futures kicked-off the week on a gap higher, lifted by the Trump-Xi meeting at the G20 summit. The United States and China agreed to hold off tariff escalation, arrange new trade talks, and reach a deal within the coming 90 days. The outcome of the meeting was enough to enhance investors' risk sentiment. The Dow Jones Industrial Average futures climbed 1.8% to 26042, the S&P500 futures jumped 1.7% to 2807, and the Nasdaq futures rose 2.2% to 7120. During this week, market participants will focus on the testimony of Fed's Powell to the Congress this week and the arrangement of the new trade talks.

USD

The dollar index which measures the greenback against a basket of major currencies fell 0.4% during the Asian session as safe-haven buying faded and investors rushed to riskier currencies. The round of dollar selling started last week when Chairman Powell hinted that interest rates are "just below" neutral levels.  Powell will testify to the Congress about the economic outlook, where investors will search for clues about interest rate path.  The USDCAD fell 0.7% to 1.3190, and the EURUSD gained 0.5% to $1.1375.

Metals

Metals prices advanced as the dollar weakened amid falling demand for safe-haven currencies on US-China trade truce. The gold ounce climbed 0.8% to $1231, and the silver ounce gained 1.6% to $14.39.

Oil

Oil prices started the week on a strong note rising more than 5%, supported by Trump-Xi meeting, and the growing expectations of a supply cut by the OPEC plus Russia this week. The West Texas Intermediate futures rose 5.9% to $53.63, and the Brent futures rose 5.5% to $62.35.

Major Economic Events

GMT Country Event Expectation Previous
8:55 EU German Manufacturing PMI (Nov) 51.6 51.6
9:30 UK Manufacturing PMI (Nov) 51.6 51.1
15:00 US ISM Manufacturing PMI (Nov) 57.5 57.7
18:00 US FOMC Member Kaplan Speaks    

 

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