Daily Market Analysis from ForexMart

[KostiaForexMart]

Microsoft's Big AI Spend Weakens Wall Street, Nasdaq Dow

U.S. Indices Close in the Red: AI Costs Hit Market Optimism
All three major U.S. stock indices ended Thursday's trading session in negative territory after reports from Microsoft and Meta Platforms (banned in Russia) highlighted rising AI-related expenses that could impact future profits, dampening enthusiasm for the mega-cap companies that had driven this year's rally.

Microsoft: Record Profits Couldn't Prevent Stock Drop
Despite Meta Platforms (banned in Russia) and Microsoft (MSFT.O) surpassing profit expectations, their stocks fell significantly, with Meta dropping by 4.1% and Microsoft by 6%. This decline followed reports indicating rising AI costs, which investors perceived cautiously, seeing the potential for these costs to reduce profit margins.

The "Magnificent Seven" Lose Ground
Among other tech giants in the so-called "Magnificent Seven," both Amazon.com (AMZN.O) and Apple (AAPL.O) released their quarterly results. Amazon exceeded revenue forecasts, driven by strong growth in its cloud division, while Apple pleased investors with higher-than-expected iPhone sales and met expectations in both revenue and profit.

Amazon Up, Apple Down: Market Reacts to Earnings Reports
As a result, Amazon.com shares rose by 4.5% after market close due to solid quarterly results that exceeded Wall Street's estimates. Apple shares, however, slipped by 2% despite its positive report, remaining aligned with investor forecasts. During the regular trading session, Amazon saw a decline of 3.3%, while Apple's shares fell by 1.8%.

Alphabet Also Ends Lower
Alphabet (GOOGL.O), which reported earlier on Tuesday, also faced pressure, with its shares dropping by 1.9%.

Investors Wary: Unlimited AI Budgets Raise Questions
"The 'Magnificent Seven' are clearly hinting that their AI-related budgets remain open-ended, and this isn't a comforting message for investors," said Carol Schleif, Chief Investment Officer at BMO Family Office. "While long-term benefits for the U.S. economy could be substantial, the short-term question remains: where is the immediate profit from these investments?"

Microsoft Points to Rising Capital Expenditures
Microsoft confirmed that increasing capital expenditures are linked to its expansion of AI investments, potentially affecting its profit margin, causing uncertainty among shareholders.

Market Downturn: Major Indices Lose Ground
The market reacted with declines across all major indices. The Dow Jones Industrial Average (.DJI) closed down by 378.08 points, or 0.90%, at 41,763.46. The S&P 500 (.SPX) dropped by 108.22 points, or 1.86%, to 5,705.45, while the Nasdaq Composite (.IXIC) lost 512.78 points, or 2.76%, ending the trading day at 18,095.15.

Monthly Losses: Market Ends Extended Growth Streak
Amid September's fluctuations, the S&P 500 lost 0.99% for the month, Nasdaq fell by 0.52%, and the Dow ended with a 1.34% loss, marking the end of a five-month growth streak for the Dow and S&P.

Inflation Continues to Rise: Consumer Spending Exceeds Expectations
According to the latest Personal Consumption Expenditures (PCE) index, a key inflation indicator closely watched by the Federal Reserve, prices rose by 0.2% in September, aligning with analyst forecasts. However, the annual core inflation rate reached 2.7%, slightly above the 2.6% forecast, while consumer spending also exceeded expectations, adding further uncertainty regarding the central bank's future actions.

Intel Faces Restructuring Costs and Write-Downs
Intel (INTC.O) presented its earnings report post-market close, which showed the impact of restructuring costs and asset write-downs. Despite optimization efforts, the company's financial results fell short of expectations, leading to a restrained reaction from investors.

Market Under Pressure: NYSE Decliners Outnumber Advancers
On the New York Stock Exchange (NYSE), the number of declining stocks outpaced gainers by more than two and a half times, at a ratio of 2.66 to 1. During the trading day, the S&P 500 recorded 24 new 52-week highs and nine new lows, while the Nasdaq Composite registered 59 new highs and 159 new lows, reflecting the general negative market sentiment.

U.S. Consumer Spending Rises, Economy Strengthens
Thursday morning data indicated that U.S. consumer spending in September exceeded expectations, providing a positive signal for the economy, directing it toward a stronger growth trajectory in the year's final quarter. This increase in spending could bolster confidence in economic resilience.

Labor Costs Slow Growth
Another report showed that the Employment Cost Index (ECI), the broadest measure of labor costs, rose by 0.8% in the third quarter. This growth marked the slowest pace since mid-2021, lower than the previous quarter's 0.9% figure, indicating a potential easing in wage inflation.

Dollar Weakens as Yen and Euro Strengthen on Economic News
The dollar came under pressure against the yen after the Bank of Japan took a slightly more hawkish stance than anticipated, while the euro gained ground following data indicating faster-than-expected inflation in the eurozone in October. This factor supported arguments for a cautious approach to potential rate cuts by the European Central Bank, adding additional strength to the euro.

Dollar Index Declines, Yen and Euro Gain Ground
The dollar index, which measures the dollar's value against a basket of six major currencies, fell by 0.2% to 103.88, while the euro edged up by 0.04% against the dollar to $1.0859. Meanwhile, the dollar weakened 0.8% against the Japanese yen, reaching 152.18 yen. These currency fluctuations come amid expectations for the upcoming Fed meeting.

Rate Cut Anticipation: Markets Almost Certain
The market is nearly convinced that the Fed will implement a 25-basis point rate cut during its November 6-7 meeting. However, according to CME Group's FedWatch tool, there is only a 70% chance of an additional cut in December, reflecting investor caution.

Eyes on Employment Report and Presidential Race
Traders and investors are focused on key events in the coming days, with October's U.S. employment report due on Friday and the presidential election set for Tuesday. Polls indicate a close race between Republican Donald Trump and Democrat Vice President Kamala Harris, adding uncertainty on the political front.

Global Indices Fall, Bond Yields Rise
The global MSCI Index (.MIWD00000PUS) closed down by 12.64 points, or 1.50%, at 832.30, and saw a 2.3% decline in October, ending a five-month winning streak. The European STOXX 600 index also ended the day in the red, down 1.2%.

Yields on U.S. Treasury bonds rose following the release of economic data. The 10-year bond yield increased by 1.8 basis points to 4.282%, nearing Tuesday's four-month high of 4.339%.

Cryptocurrency Market Under Pressure: Bitcoin Loses Ground
On the cryptocurrency market, Bitcoin, the world's largest cryptocurrency by market capitalization, fell by 3.2%, reaching $70,458. This level is about 4% below its all-time high from March, signaling short-term fluctuations amid market volatility.

Gold Retraces After Record High, Monthly Gains Remain Strong
Gold retreated slightly after hitting a new all-time high, though it wrapped up a fourth consecutive month of gains, supported by demand for safe-haven assets. Spot gold dropped by 1.6% to $2,740.45 per ounce, after reaching a peak of $2,790.15 earlier in the session. Gold prices saw a 4% increase over the month, underscoring its appeal during times of instability.

Oil Prices Surge Amid Middle East Tensions
Oil prices continued their upward movement in response to reports suggesting that Iran is preparing to launch an attack on Israel from Iraq within days. WTI crude futures surged by $1.81, reaching $70.42 by 3:00 PM ET. Brent crude futures for January delivery also rose by $1.82, hitting $73.98. U.S. crude climbed by 1.33%, settling at $69.52 per barrel, while Brent rose by 0.94%, ending at $73.23 per barrel.

This increase highlights the oil market's sensitivity to geopolitical risks and confirms its reaction to potential escalations in a region that remains a crucial energy supplier.
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[KostiaForexMart]

Trading Signals for GOLD (XAU/USD) for November 1-4, 2024: sell below $2,766 (21 SMA - 61.8%)

Early in the American session, gold is trading around 2,750, within the uptrend channel, and below the 21 SMA, bouncing after having reached the low of 2,732.

Yesterday, after having reached the low of 2,790, gold made a strong technical correction. Today we observed a technical rebound. However, the instrument remains under bearish pressure. Hence, we could expect that if the metal reaches the 61.8% Fibonacci level around 2,766, it could be seen as an opportunity to resume selling.

On the other hand, in case gold breaks the inverted pennant pattern sharply, we could expect it to reach the 3/8 Murray area around 2,734. The instrument could even continue its fall next week and reach the 200 EMA around 2,673.

The key is to pay attention to the 61.8% retracement level. Below this area, the outlook will remain bearish for gold. Therefore, traders will have an opportunity to sell below this area.

Should XAU/USD bounce and consolidate above 3/8 Murray, we could look for buying opportunities with the target at 2,766 as this could confirm that a strong bottom is in place.
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[KostiaForexMart]

Markets in election grip: Dow, S&P fall, Nvidia climbs steadily

U.S. Stock Market Wrap-Up: Election Anticipation and Investor Anxiety
U.S. stocks ended slightly down on Monday after a volatile trading session, with investors bracing for a decisive week as the nation prepares to choose its next president and the Federal Reserve gets set to release a key policy statement.

Final Push: Trump vs. Harris
In the final hours of the presidential race, candidates Donald Trump and Kamala Harris pulled out all the stops in an effort to secure crucial votes. Polls show a close race, and it may take several days to determine the winner.

Trump Trades Lose Steam
Some of the so-called "Trump trades" faced declines after recent polling showed Harris, a Democratic vice president, leading in Iowa. This led to a dip in the U.S. dollar, Treasury yields, and Bitcoin. Meanwhile, Trump Media & Technology Group (DJT.O) ended up with a 12.37% gain, recovering from early losses of nearly 6%.

Harris's Odds Rise in Betting Markets
Following the Iowa poll, Harris's odds against the former Republican president increased on several betting sites, which many market participants view as a predictor of election outcomes.

"We'll need until at least Thursday to determine who won, so unfortunately, this week will likely be quite volatile," said Sam Stovall, chief investment strategist at CFRA Research in New York.

"Earnings are doing well, the Fed will likely lower interest rates, and the only true uncertainty is the election. Hopefully, it will be resolved sooner rather than later, so investors can get back to business as usual," Stovall added.

Wall Street Indices Struggle Amid Uncertainty
On Monday, major U.S. stock indexes slid into the red. The Dow Jones Industrial Average (.DJI) fell by 257.59 points, or 0.61%, closing at 41,794.60. The S&P 500 (.SPX) also declined, losing 16.11 points, or 0.28%, to settle at 5,712.69. The Nasdaq Composite (.IXIC) joined the downtrend, shedding 59.93 points, or 0.33%, and ending at 18,179.98.

Bond Yields Continue to Slide
On the bond market, ten-year U.S. Treasury yields took another hit, falling 6.4 basis points to 4.299%, following an initial drop of 10 basis points. Investors anticipate a volatile week as they await election results and policy clarity.

Russell 2000 Gains on Falling Yields
With bond yields declining, the Russell 2000 (.RUT) saw a modest 0.4% increase, as lower borrowing costs tend to benefit small-cap stocks, which are seen as more likely to gain from lower rates.

CBOE Volatility Index Rises: Fear Index Holds Steady Near Highs
The CBOE Volatility Index (.VIX), known as Wall Street's "fear gauge," climbed to 21.94, staying well above its long-term average of 19.46. It hovered near last week's two-month high of 23.42, reflecting heightened market tension over the pending election and potential economic fallout.

Fed Rate Cut Expected with Near Certainty
Heading into Thursday, investors are almost certain the Federal Reserve will cut the benchmark interest rate by 25 basis points. According to CME's FedWatch tool, there is a 98% chance of a rate cut and only a 2% chance the Fed will hold rates steady. This expectation has been priced into the market, heavily influencing investor sentiment.

Energy Sector Leads Gains Amid Oil Surge
Among the S&P 500's 11 major sectors, energy (.SPNY) led the way, gaining 1.87%, buoyed by a rise in oil prices following OPEC+'s decision to postpone production hikes.

Nvidia Replaces Intel in Dow
Chipmaker Nvidia (NVDA.O) saw a modest 0.48% gain after news that it will replace Intel (INTC.O) in the Dow Jones Industrial Average. In response, Intel's shares dropped 2.93%, weighing on the Dow.

Marriott Slips on Lowered Profit Outlook
Hotel operator Marriott International (MAR.O) declined by 1.59% after lowering its 2024 profit forecast due to weak domestic travel demand in the U.S. and China.

Constellation Energy Takes a Hit Following FERC Rejection
Constellation Energy (CEG.O) performed the worst in the S&P 500, down 12.46%. The Federal Energy Regulatory Commission denied a deal to expand capacity at Amazon's data center, which is directly connected to Talen Energy's nuclear plant in Pennsylvania, pressuring the utilities sector, which fell 1.21%.

Rising Stocks Outnumber Decliners on NYSE and Nasdaq
On Monday, advancers outpaced decliners on the New York Stock Exchange by a ratio of 1.37 to 1, while on the Nasdaq, the ratio was a narrower 1.01 to 1 in favor of gaining stocks, suggesting a mild overall bullish sentiment despite general caution.

Highs and Lows: Mixed Market Momentum
The S&P 500 registered 10 new 52-week highs and four new lows, reflecting positive expectations in select sectors. Meanwhile, the Nasdaq Composite saw 66 new highs but also 128 new lows, highlighting heightened volatility among technology and innovation stocks.

Trading Volume: Slightly Below Average, But Significant
U.S. trading volumes reached 11.31 billion shares, just under the 20-day average of 11.71 billion. This may indicate a cautious stance among market participants ahead of major events like the Fed meeting and presidential election.

Air France KLM Faces Downgrade and Stock Pressure
Shares of Air France KLM (AIRF.PA) fell after Morgan Stanley downgraded the airline from "equal weight" to "underweight." On Tuesday, the stock dropped roughly 2% at the start of the trading session.

Challenging Cash Flow Outlook for Air France KLM
Morgan Stanley noted that while Air France KLM's stock isn't overly expensive by historical standards, it trades at a notable premium to its peers among national carriers. This premium, combined with challenging free cash flow prospects, suggests a cautious outlook for the airline.

Third-Quarter Earnings in Europe: Surpassing Expectations but China Concerns Linger
Despite economic challenges, many European companies are surpassing low market expectations for third-quarter earnings, with investors rewarding top performers. However, concerns over weak demand in China continue to temper enthusiasm, prompting caution.

Lowered Forecasts Ease the Bar for Earnings Growth
Data from LSEG I/B/E/S shows that analysts revised down profit growth expectations by 380 basis points in the two months before the earnings season. Normally, such adjustments are around 100 basis points, but the substantial drop in projections has made it easier for companies to exceed expectations.

STOXX 600: More Companies Beating Expectations
So far, around 50% of companies in the STOXX 600 (.STOXX) index have reported their earnings, with approximately 56% exceeding forecasts. Citi equity strategists note that this figure aligns with the quarterly average, indicating that European firms are holding steady despite market turbulence.

U.S. Elections Add a Layer of Uncertainty for Europe
The upcoming U.S. elections add another layer of uncertainty, with analysts expecting that the resulting volatility could continue to impact European stocks as investors wait to see how the election outcome might influence the global economy.

Market Dynamics Shift: Reward for Outperformance and Penalties for Misses
This quarter, companies that have exceeded expectations are being notably rewarded by investors. On the other hand, those missing forecasts are feeling the pressure as the market takes a tougher stance on underperformance.

European Banks Boosted by High Interest Rates
European banks have enjoyed another strong quarter as persistently high interest rates continue to support profit margins. Even as the European Central Bank signals potential rate cuts, investor sentiment remains positive.

Higher Structural Rates: A Win for Banks
"Interest rates will structurally remain higher than in previous cycles," remarked Thomas McGarrity, head of equity at RBC Wealth Management. He believes this will benefit banks significantly, allowing them to sustain strong margins. "We're in a favorable position and won't be backing down," McGarrity added.

Financial Sector's Profit Growth Among the Highest
Data from LSEG I/B/E/S shows that the financial sector saw 20.6% profit growth in the third quarter, ranking it third among major sectors after utilities and basic materials. So far, 80% of financial companies have reported earnings that beat analyst expectations.

Economic Stagnation Hits Small and Mid-Caps Hardest
Meanwhile, Europe's economy remains in a state of stagnation. The industrial sector, particularly reliant on energy, faces challenges from rising costs and weak global demand. For small- and mid-cap companies focused on the domestic market, these issues create significant headwinds and unstable growth prospects.

European Stocks Historically Undervalued: Attractive Ratios for Investors
Currently, European stocks remain historically undervalued. The average 12-month forward P/E ratio stands at 13.6x, lower than the long-term average of 14.3x. Mid-cap stocks appear even more attractive, trading at a forward P/E of 12.7x compared to the long-term average of 15x. This undervaluation makes European assets appealing to investors seeking growth potential in stable markets.
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[KostiaForexMart]

Political instability, rate cuts and Nvidia's record: what's happening in the market?

US markets end the day higher amid Fed rate cuts
US stock markets ended trading on Thursday with a confident rise, helped by the Federal Reserve's decision to cut interest rates by a quarter of a percentage point (25 bps). This development strengthened the positive trend that began after Donald Trump returned to the US presidency.

Fed Cuts Rate as Labor Market Weakens, Inflation Nears Target
The Federal Reserve has decided to cut rates by 0.25%, citing signs of weakness in the labor market and a gradual move in inflation toward the central bank's 2% target.

Markets had largely expected the move, almost entirely factoring the rate cut into their forecasts for the November meeting. Investors are now watching closely for any follow-up comments from Fed officials that could shed light on the future direction of monetary policy.

Hopes for Economic Growth Push Indexes Higher
Expectations of a return to corporate tax cuts and Trump-led regulatory easing have fueled investor optimism, sending key stock indexes higher. The Dow Industrials and S&P 500 posted their biggest one-day gains in two years last trading session, while the Nasdaq was not far behind, continuing to move in the green.

Expert Comment: "Rate Cut Keeps Caps Level, But Eases Them"
"The Fed has kept the drama out of this eventful period," said Brian Jacobsen, chief economist at Annex Wealth Management in Wisconsin. "A quarter-percentage point cut leaves the federal funds rate still in cap territory, but it's not as tight as it used to be." He said Trump's return to the presidency could bring a modest improvement in growth, but it would also likely lead to higher inflation. "The Fed will likely have to cut rates at a more cautious pace," Jacobsen concluded.

U.S. Indexes End Mixed
The Dow Jones Industrial Average (.DJI) was virtually unchanged, down just 0.59 points to 43,729.34. The S&P 500 (.SPX) added 0.74%, rising 44.06 points to 5,973.10, while the tech-heavy Nasdaq Composite (.IXIC) was the biggest gainer, rising 1.51%, or 285.99 points, to end the session at 19,269.46.

Communications Leads as Warner Bros Discovery Gains
Communications (.SPLRCL) was the biggest gainer among sectors, jumping 1.92%. This was helped by a massive 11.81% gain in Warner Bros Discovery (WBD.O) after the company reported unexpectedly strong third-quarter earnings, which encouraged investors to buy into the sector.

Financials Slow Down
The financial sector (.SPSY) was among the laggards, losing 1.62% after a strong rally in the previous session. In particular, banks (.SPXBK) fell 3.09%, reversing a significant gain from Wednesday. JP Morgan (JPM.N) and Goldman Sachs (GS.N) also showed negative dynamics, with their shares falling 4.32% and 2.32%, respectively, putting pressure on the Dow.

Expectations for rate cuts weaken
Sentiment towards further rate cuts has become less optimistic in recent weeks. Economic data points to economic resilience, which could push inflation higher. Such a scenario is likely amid expected tariff changes and increased government spending under the policies of the new Trump administration.

Powell: Fed ready for changes
Fed Chairman Jerome Powell noted that the final decision on the central bank's December policy has not yet been made. However, he stressed that the Fed is prepared to adjust the course and pace of its actions given the current economic uncertainty.

Investors are keeping a close eye on Congress
One of the key factors attracting investors' attention remains the possibility of the Republicans taking control of both houses of Congress. If this happens, it will be easier for Donald Trump to advance his economic agenda, which will potentially increase support for the business sector and cause a positive reaction in the market.

Treasury yields retreat after rally
After a wild rally in recent weeks, 10-year Treasury yields retreated for a time. The benchmark yield, which hit a four-month high of 4.479% on Wednesday, eased slightly after the Fed's announcement to close at 4.332%.

Unemployment remains stable
U.S. jobless claims rose slightly last week, data showed Thursday, pointing to stable labor market conditions. The lack of a significant increase in unemployment is a boost to confidence in economic resilience, easing concerns about the need for urgent changes in monetary policy. NYSE and Nasdaq rally, S&P 500 and Nasdaq Composite hit record highs

On the New York Stock Exchange, gainers outnumbered losers by nearly twice (1.94 to 1). On the Nasdaq, the ratio was 1.18 to 1. The S&P 500 posted 56 new 52-week highs and just 4 new lows, while the Nasdaq Composite posted 193 new highs and 88 new lows.

Trading activity on U.S. exchanges beats averages
Turnover on U.S. exchanges reached 16.78 billion shares on Thursday, well above the average daily volume of 12.46 billion shares over the past 20 trading days.

MSCI Global Index Continues to Rise
The MSCI Index of global equities (.MIWD00000PUS) rose 0.9% to a new record high, signaling continued appetite for global markets amid a pickup in economic activity.

European Markets Rise
Europe's STOXX 600 Index (.STOXX) rose 0.6% following a strong start to Asian trading. The index was also supported by Chinese blue chips, which jumped 3% (.CSI300). Investor sentiment was boosted by expectations of more stimulus measures, which outweighed concerns over escalating trade tensions.

Corporate Tax and Deregulation Optimism
"Equities are reflecting expectations of lower corporate taxes and reacting positively to the prospect of deregulation, which will benefit earnings," said Naomi Fink, chief strategist at Nikko Asset Management. Companies across industries see new growth potential in the policy, spurring further investor interest in key assets.

Treasury yields continue to decline
U.S. Treasury yields continue to decline following the Fed's rate cut, although analysts warn that the process may be less sustainable than expected under the new Trump administration.

Republican victory: potential implications for growth and inflation
There is growing consensus among economists that a Republican election win could be a catalyst for more accommodative fiscal policy. Matthias Scheiber, head of portfolio management at Allspring Global Investments, believes that the combined effect of new tariffs and stimulus could boost the economy but also increase inflation pressures.

Yields: Reaction to rate cuts
The yield on the 10-year Treasury note fell 9 basis points to 4.3355% on Thursday, after rising 14 basis points the previous day. The 30-year yield also fell more than 6 basis points to 4.5393% after a big jump the previous day.

Dollar Loses Ground Amid Corrections
The dollar fell 0.7% against a basket of major currencies, reversing Wednesday's biggest one-day gain in more than two years. Many traders began to close positions on a Trump victory and were looking ahead to the Fed's upcoming decision, weighing on market sentiment.

Euro Strengthens Amid Political Change in Germany
The euro rose 0.7% to $1.0803, partly reversing a 1.8% average loss the previous day. The euro is recovering as investors digest the latest political developments in Germany, where Chancellor Olaf Scholz fired Finance Minister Christian Lindner, leading to the collapse of the coalition government and likely to lead to early elections. Euro Strengthening Forecasts

Deutsche Bank analysts note that while events in Germany are still in the early stages, potential political stability could strengthen confidence in the euro. Economic forecasts also point to possible positive effects if the new government adopts a more proactive fiscal stance.

German Bond Yields Rise
German 10-year bond yields rose 4.8 basis points to 2.441%, reflecting market expectations for future EU policy developments.

Bank of England cuts rates amid inflation risks
Meanwhile, the Bank of England has cut interest rates by a quarter of a percentage point, its second such move since 2020. The regulator has signaled that further cuts will be gradual, given the risks of rising inflation following the new government's budget presented last week.

Pound sterling also shows gains
The British pound also regained some of its positions and rose by 0.8%, rising to $1.2986 after falling by 1.24% on Wednesday.

Norway, Sweden central banks stick to their previous course
Norway and Sweden central banks held their meetings on Thursday, which resulted in no significant changes for the currency markets, fully meeting analysts' expectations. Norges Bank decided to leave interest rates at a 16-year high, maintaining its commitment to tight monetary policy. At the same time, Sweden's Riksbank cut rates by 50 basis points, softening its approach to monetary policy.

Bitcoin at Record Highs
The Bitcoin cryptocurrency has rapidly recovered its recent losses and reached a new all-time high of $76,780 overnight. Against this backdrop, Donald Trump said that he would make the United States the "crypto capital of the world," which has increased investor interest in digital assets.
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[KostiaForexMart]

Crisis on the Horizon? Politics and Economics Drown Dow, Nasdaq, Tesla

Profit-Taking Wave: Wall Street Indexes End Day Lower
The key U.S. stock indexes closed lower on Tuesday as investors sought to take profits after the recent rally that began amid the presidential election. Markets are anxiously awaiting fresh U.S. inflation data this week, which could significantly impact future price action.

Post-Election Records: Investors Assess Prospects
Stock indices have been on a tear since the November 5 election, buoyed by new President Donald Trump's promises to cut taxes and loosen business regulations. Market participants have been buying up shares, hoping that these measures will support economic growth and revive the corporate sector.

Inflation Concerns Have Cooled Enthusiasm
However, optimism in the market declined on Tuesday, as investors began to worry that the policies proposed by the Trump administration could trigger a rise in inflation. Amid these concerns, European markets also fell, losing 2%, after statements from the European Central Bank, who warned that higher tariffs from the United States could hurt the global economy.

Tesla and Others Lose Ground After a Jump
Some companies that investors had previously been buying up in anticipation of their rise under the new administration have retreated after reaching peaks. Tesla (TSLA.O) shares fell 6% on Tuesday, despite an impressive 40% gain since the election.

Economic growth is a positive sign, but bonds are under pressure
Karen Karniol-Tambour, co-chief investment officer at Bridgewater Associates, emphasized at the Yahoo Finance Invest conference that despite the risks, U.S. stocks remain attractive assets amid the expected sustainable economic growth in the U.S. She noted that this dynamic is supporting the stock market, although the yield on 10-year Treasury notes has already reached a four-month high, rising amid an expected review of economic policy.

Russell 2000 - from peak to trough
The Russell 2000 small company index (.RUT) fell 1.8%, although on Monday it finished trading at the highest level in the last three years. Meanwhile, rising Treasury yields have added pressure on stocks as bond investors begin to price in the Trump administration's future policies.

Treasuries as a Worry Signal for Stocks
Jack Ablin, chief investment officer at Cresset Capital, described the current situation as a difficult balance, with rising 10-year Treasury yields creating a headwind for the stock rally. "On the one hand, investors are cheering about the stimulus package, but on the other, the bond market is signaling its displeasure," he explained.

Ablin added that tariffs, tax breaks, and immigration restrictions could fuel inflation, something that is not lost on the bond market, which is sensitive to such developments.

Global Impact and Inflation Data Expectations
Ameriprise Financial Chief Economist Russell Price noted that U.S. stocks were also pushed lower by weakness in overseas markets and profit-taking ahead of key U.S. inflation data. The consumer price index is due out on Wednesday, followed by producer price and retail sales data, both of which could shed light on the Federal Reserve's policy outlook.

These data add short-term risks for investors, Price said. "It's likely the anticipation of these numbers that is driving the modest declines we've seen in the markets today," he said.

Wall Street Closes Lower as Major Indexes Slip
The Dow Jones Industrial Average (.DJI) ended the day down 382.15 points, down 0.86% to 43,910.98. The S&P 500 (.SPX) fell 17.36 points, or 0.29%, to close at 5,983.99, while the Nasdaq Composite (.IXIC) lost 17.36 points, or 0.09%, to close at 19,281.40.

Amgen Under Pressure, Sliding Late
The biggest decliner on the Dow was Amgen (AMGN.O), which fell more than 7% amid a sell-off that intensified toward the end of the session. Amgen shares fell after Cantor Fitzgerald said it could cause side effects from its experimental obesity drug MariTide, which showed a 4% drop in bone mineral density.

Materials and Healthcare Down, Communications Gaining
Among the 11 key S&P 500 sectors, Materials (.SPLRCM) saw the biggest decline, falling 1.6%. The second-largest loser was Healthcare (.SPXHC), with Amgen accounting for a significant portion of the losses. In contrast, Communications (.SPLRCL) was in the green, gaining 0.5% on the day.

Fed Focus: Kashkari and Barkin Assess
The markets also took notice of statements from the Federal Reserve. Minneapolis Fed President Neel Kashkari on Tuesday said current U.S. monetary policy remains "moderately restrictive" and is helping to slow inflation and the economy, albeit only slightly. Richmond Fed President Thomas Barkin, meanwhile, said the Fed is prepared to take action if inflation risks intensify or the labor market shows signs of weakening.

Novavax Slips as Revenue Forecast Cuts
Biotech company Novavax (NVAX.O) shares fell 6% after the company announced it was cutting its full-year revenue forecast. The reason was weaker-than-expected sales of its COVID-19 vaccine, which disappointed investors.

Honeywell at its peak: Elliott Investment backs it
Meanwhile, Honeywell (HON.O) shares soared 3.8% to a record high. The rally came as activist investor Elliott Investment increased its stake in the company by more than $5 billion, giving investors confidence in the industrial giant's future growth.

Stocks on the market: More decliners than gainers
Declining stocks were significantly outnumbered on the New York Stock Exchange, with a ratio of 3.48 to 1. Meanwhile, the NYSE recorded 328 new highs and 101 new lows. Declining stocks also outnumbered advancing ones on the Nasdaq, with 3,012 of the 4,336 shares trading down and 1,328 gaining. The S&P 500 posted 55 new 52-week highs and 16 new lows, while the Nasdaq Composite added 193 new highs and 129 new lows.

Volumes on the rise, Asian stocks under pressure
Total trading volume on U.S. exchanges reached 15.29 billion shares, above the 20-session average of 13.17 billion. Meanwhile, Asian stocks also fell on Wednesday, as a sharp rise in U.S. bond yields fueled worries ahead of key inflation data that could impact the Federal Reserve's monetary policy decisions.

Short-term bond yields rise, dollar strengthens
Short-term U.S. Treasury yields rose sharply on Tuesday, hitting their highest since late July. The move also helped the dollar strengthen, hitting a more than three-month high against the Japanese yen as the market reopened after the Veterans Day holiday.

Trump Policy and Inflation Expectations
Since Donald Trump was elected president, rising bond yields have been a clear trend as market participants anticipate that promised tax cuts and tariffs could lead to a larger budget deficit and more government borrowing. Such a scenario, analysts say, would also fuel inflation, making it harder for the Fed to cut interest rates further.

Tug of War: Stocks and Bonds
Against this backdrop, the U.S. stock market enjoyed a record rally, but that optimism quickly turned to caution as bond yields began to rise. Kyle Rodda, senior financial markets analyst at Capital.com, noted that the move remains part of the so-called "Trump trade," which is based on the idea of more deficit spending. "However, as we have seen before, higher risk-off asset rates are starting to put pressure on equity valuations, creating a tug-of-war between the bond and equity markets," he added.

Bitcoin Returns to Record High: Betting on Trump's Crypto-Friendly Policy
Bitcoin is slowly but surely moving towards its all-time high, approaching the $90,000 mark. Its price is currently hovering around $88,195, reflecting market participants' expectations inspired by Trump's promise to turn the US into a global crypto hub. Investors are hoping that possible regulatory easing will give the cryptocurrency a new boost.

China in Focus: Commodity Market Weakening
Meanwhile, global commodities have come under pressure as traders are worried about China's economic outlook, which may have to contend with new trade tariffs from the US. The economic stimulus measures announced by Beijing have not yet inspired confidence in the ability of market participants to quickly recover the largest Asian economy.

Asian Markets Tumble
Asian markets are also down, with Hong Kong's Hang Seng Index (.HSI) down 0.9%, while the mainland China Property Index (.HSMPI) fell 1.3%. Chinese blue chips (.CSI) were unchanged. Japan's Nikkei (.N225) and South Korea's Kospi (.KS11) fell 1.1% and 1.2%, respectively, while Australia's (.AXJO) also fell 1.1%, weighed down by commodity stocks.

US Futures and Bond Yields: Sustained Tension
S&P 500 futures are down 0.1%, continuing their gains after an overnight 0.3% drop. Meanwhile, the yield on two-year Treasury notes hit 4.34%, the first time it has risen to 4.367% since late July. The 10-year yield remains at 4.43%, not far from the four-month high of 4.479% set immediately after Trump's landslide election victory.

Dollar on the cusp: Yen strength raises expectations of intervention
The dollar hit 154.94 yen for the first time since late July before falling back to 154.56 yen. That brings the dollar/yen pair closer to the important 155 yen threshold, which many analysts see as a potential point at which Japanese policymakers could intervene verbally to prevent the yen from weakening further.
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[KostiaForexMart]

Trading Signals for GOLD (XAU/USD) for November 14-16, 2024: buy above $2,553 (2/8 Murray - rebound)

Early in the European session, Gold (XAU/USD) was trading around 2,563 below 2/8 Murray and within the downtrend channel forming since October 29.

On the H4 chart, we can see that during yesterday's American session, gold reached the area of 3/8 Murray and the 21 SMA, which acted as strong resistance in light of the US inflation data.

In the next few hours, we believe that gold could have a recovery, as technically we observe an oversold signal.

We believe that a technical bounce is likely to occur around the S_1 support located at 2,653 or around the bottom of the downtrend channel located at 2,550. Above this area, we will have an opportunity to buy.

Additionally, if gold consolidates above 2/8 of Murray located at 2,578, it will be seen as a positive signal and we can buy with targets at 2,619 and 2,621.

If gold continues its bearish cycle, the immediate support is located around 2,539 (1/8 Murray). The eagle indicator is reaching an extreme oversold zone. So, we believe that there could be a technical reboundin the next few days.
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[KostiaForexMart]

Tesla Buzz, Nasdaq Gains, Nvidia Intrigue — Wall Street Events

Nasdaq and S&P 500 Results: Nvidia on the Horizon, Tesla Surprises
The Nasdaq and S&P 500 ended Monday's trading in the "green zone," recouping some of their previous losses. Investors turned their attention to Nvidia's (NVDA.O) earnings call, while Tesla's (TSLA.O) shares rose sharply on expectations of favorable policy changes from the new Trump administration.

Nvidia: AI bets continue
Nvidia is set to report third-quarter financial results on Wednesday, with investors awaiting answers to a key question: whether strong demand for chips is continuing and whether the AI euphoria that has driven growth this year is sustaining the market.

The company, which has accounted for about 20% of the S&P 500's earnings over the past 12 months, is expected to post 25% EPS growth in the third quarter, according to analysts at BofA Global Research. However, Nvidia shares fell 1.3% after reports of new AI chips overheating in server systems.

Expert Comments: Moderate Optimism
"Nvidia is the last of the Magnificent Seven to report quarterly results. While we are seeing revenue and interest pick up, the current level of expectations is not as high as it was a quarter or two ago," said Carol Schleif, chief investment officer at BMO Family Office.

Tesla: Jump on Expectations
Tesla shares have soared, reflecting positive market sentiment about possible policy changes associated with the new administration. Such growth underscores investors' desire to seize opportunities in a rapidly changing environment.

The sentiment around Nvidia and Tesla in the coming days may become an indicator of the future direction of the market, which promises many surprises for traders.

US indices: Nasdaq and S&P 500 in the green, Dow Jones declines
Trading on the US stock market on Monday ended with mixed dynamics of key indices. The Dow Jones Industrial Average (.DJI) lost 55.39 points (-0.13%) to end at 43,389.60. At the same time, the S&P 500 (.SPX) added 23.00 points (+0.39%) to end at 5,893.62, and the Nasdaq Composite (.IXIC) rose 111.69 points (+0.60%) to end at 18,791.81.

Energy and Tesla: Who's Pulling the S&P 500 Up
The energy sector (.SPNY) led the S&P 500, rising 1.05%. Consumer discretionary stocks (.SPLRCD) followed suit, adding 1.04%. Tesla was in the spotlight, with shares jumping 5.6% after Bloomberg's report.

Donald Trump's transition team is reportedly considering loosening regulations on self-driving cars, fueling investor interest.

Meanwhile, industrials (.SPLRCI) were among the laggards, posting the biggest declines among sectors.

CVS Health Gains Strength
In notable corporate news, CVS Health (CVS.N) shares rose 5.4%. The jump was the result of the company announcing it would expand its board by adding four new members as part of a deal with Glenview Capital Management.

Experts Predict Volatility
Carol Schleiff, chief investment officer at BMO Family Office, said, "There could be significant volatility in some sectors right now until we hear more details about the decisions of the new Trump team, which is expected later this month."

Market Takes Stock of the Year
Despite a correction following the sharp post-election rally, sentiment on Wall Street remains positive.

The year 2024 is drawing to a close, demonstrating the resilience of the U.S. stock market, although its future direction will depend on political decisions and new macroeconomic factors.

Stock Market: Holiday Season, Political Uncertainty, and Expectations from the Fed
U.S. stock indexes ended last week with the largest losses in the last two months. Investors are worried about the slowdown in the pace of easing by the Federal Reserve, as well as uncertainty around Donald Trump's appointments to his administration.

Retailers under close scrutiny
The start of the week coincided with an active holiday shopping season, which shifts the market's focus to the largest retail players. Walmart (WMT.N), Lowe's Companies (LOW.N) and Target (TGT.N) are preparing to release their results, which will become an indicator of the state of American consumer demand.

Balance of Power: More Winners on the NYSE
On the New York Stock Exchange, gainers outnumbered decliners 1.71 to 1, with 159 new yearly highs and 88 new yearly lows.

On the Nasdaq, the picture was balanced, with 2,158 gainers and 2,150 decliners. The S&P 500 posted 29 new yearly highs and 13 new yearly lows, while the Nasdaq Composite posted 69 new yearly highs and 265 new yearly lows.

Trading Activity Beats Averages
Trading volume on U.S. exchanges totaled 14.94 billion shares, exceeding the 20-day average of 14.12 billion. This activity indicates that traders are paying close attention to market events.

Global sentiment: Stocks rise, dollar falls
Global markets were positive on Monday, with stocks rising while the US dollar slipped, although it remains close to its yearly peaks. Investors moderated expectations about the Federal Reserve's next move, easing some of the pressure on the currency.

The holiday season is coming, and its outcome is expected to add clarity to the overall picture of the US economy.

Trump appointments and economic uncertainty: focus on key positions
US President-elect Donald Trump is busy building his team, filling important positions in the areas of health care and defense. However, key appointments for financial markets – the Treasury Secretary and the Trade Representative – remain open, adding uncertainty to the outlook.

New policies: taxes and tariffs in focus
The incoming Trump administration is expected to focus on two priorities: tax cuts and higher tariffs. Economists say such measures could trigger higher inflation, limiting the Federal Reserve's ability to cut interest rates.

Bond Yields: A Red Flag?
The U.S. Treasury yield market has seen yields fall amid heightened volatility. The benchmark 10-year note has lost 1 basis point to 4.416%.

"The 10-year yield reflects budget and deficit concerns, and signals underlying inflation risks if new tariffs are imposed," said Wasif Latif, president and chief investment officer at Sarmaya Partners.

Inflation: Back on the Table
The structure and scale of tariffs that the new administration may initiate have inflationary potential, according to Latif. "The bond market is sending a clear signal. The stock market may have paused last week, but today it seems to be riding a wave of optimism again," he said.

Markets: Balancing Expectations and Risks
Investors continue to balance optimism over economic stimulus measures with concerns that new tariffs and rising inflation could complicate the Fed's monetary policy. In the coming weeks, attention will focus on filling key positions and the details of the Trump administration's economic strategy.

European Markets Under Pressure: Real Estate and Utilities in the Red
European stock markets ended the day lower, led by weakness in the real estate and utilities sectors. The pan-European STOXX 600 Index (.STOXX) lost 0.06%, reflecting a cautious investor mood.

Global Markets: Gains on Nvidia Expectations
Sentiment was more positive in global markets, with the MSCI World Index (.MIWD00000PUS), which tracks stocks around the world, rising 0.35% to 845.60. Nvidia (NVDA.O) earnings on Wednesday remain in focus.

Analysts expect strong revenue growth from the company, which continues to dominate the AI chip space. Nvidia shares have nearly tripled this year, becoming a key driver of the S&P 500's record highs.

Dollar and Forex: Strengthening Against the Yen
The U.S. dollar rose 0.29% against the Japanese yen to 154.605. However, the dollar index, which measures the dollar against six major currencies, was down 0.51% at 106.19. Despite the decline, the currency remains close to its one-year high of 107.07, reflecting the overall strength of the U.S. economy.

Oil Market: Prices Rise Sharply
Oil prices have shown a significant strengthening after the news of production suspension at Norway's largest Johan Sverdrup field.

Brent crude futures closed at $73.30 per barrel, up 3.2%. Similarly, WTI crude also gained 3.2%, closing at $69.16 per barrel.

Looking Ahead: What to Expect from Markets
Investors are eagerly awaiting earnings reports from Nvidia and other tech giants, which could set the tone for future market dynamics. The oil sector continues to react to geopolitical events, while currency traders will be watching for cues from the Federal Reserve.

Gold Returns: Prices Rise After a Week of Losses
Gold prices have rebounded after six straight days of declines. Spot gold rose 1.93% to $2,610.73 an ounce, while U.S. gold futures rose 1.7% to $2,614.60. The weakening U.S. dollar was the main driver of the precious metal's gains.

Market Calm: A Pause in News Flow
"Markets should be more stable this week as the flow of macro and policy news from the U.S. slows," said Jim Reed, head of global economics and thematic research at Deutsche Bank. The agenda continues to focus on the appointment of key figures in the new Donald Trump administration.

S&P 500 Forecasts: Growth in Perspective
Goldman Sachs has updated its forecast for the S&P 500 (.SPX), expecting it to reach 6,500 by the end of 2025. This target implies growth of 10.3% from the current value of the index, which closed at 5,893.62.

Morgan Stanley has provided a similar forecast, suggesting that the S&P 500 will reach the same level by the end of next year. The bank bases its expectations on improving corporate earnings, easing of the Federal Reserve interest rate policy in 2024, and a strengthening business cycle.
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[KostiaForexMart]

The main events by the morning: November 20

The United States will not change its nuclear policy, despite changes in Russian doctrine. According to Bloomberg, a Pentagon spokesman said that the United States has no data indicating that Russia is preparing to use nuclear weapons in Ukraine. The changes in the Russian nuclear doctrine, according to Pentagon officials, did not come as a surprise to Washington.

Biden approved the supply of anti-personnel mines to Ukraine, which are prohibited by an international agreement. The United States made this decision to help Ukrainian troops deter the advance of Russian troops. The shipments include mines that are subject to the prohibitions of the Ottawa Convention, signed by 164 countries, including the United States and Russia.

Japan and China continue to actively sell American government bonds. Japanese investors sold a record $61.9 billion of U.S. bonds in the three months ended September 30, and Chinese funds disposed of $51.3 billion worth of treasuries over the same period. Experts attribute these actions to the expectations of Donald Trump's return to power.

Vladimir Putin will visit India to meet with Prime Minister Narendra Modi. Against this background, Bloomberg noted the failure of US efforts to isolate Russia on the world stage. At the same time, Washington cannot put pressure on India, as it considers it a key ally in the confrontation with China.

Trump may lift sanctions against Russia at the end of the conflict in Ukraine. A representative of the President-elect's transition team commented on the prospect of easing and lifting Washington's sanctions against Moscow, as well as normalizing trade and economic relations between the United States and Russia. He stated that this is «certainly an opportunity if the conflict in Ukraine turns out to be resolved.»
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[KostiaForexMart]

Market at crossroads amid tensions: How investors are saving themselves in an era of uncertainty

Nasdaq slows down as investors ponder
The tech-heavy Nasdaq ended Wednesday in the red, breaking the day's upward move. The reason was the growing geopolitical tensions between Russia and Ukraine, as well as weak financial results from Target. Investors were anxiously awaiting the release of Nvidia's quarterly results, which, however, fell short of inflated expectations.

Dow in the green, S&P 500 is flat
The Dow Jones managed to finish the session higher, while the S&P 500 remained virtually unchanged. Meanwhile, morning trading began with a general decline - the news of Ukraine using British Storm Shadow missiles on Russian territory stirred up the markets. This happened immediately after the announcement of the launch of American ATACMS missiles, which prompted Russia to announce a reduction in the nuclear threshold.

"Fear scale" at a maximum since 2020
The Wall Street VIX volatility index, known as the "fear scale", rose to 18.79, which was a record since November 2020, and then fell to 17.24. Despite the pullback, anxiety in the markets remains high.

"After yesterday's strong rally in the tech sector, today the market switched to a more defensive mode," said James Regan, head of research at D.A. Davidson.

Nvidia: High Expectations Disappointed
The quarterly earnings report from AI chipmaker Nvidia was the highlight of the evening. The company's shares were down 0.76% during the session and fell further after the close. Despite a fourth-quarter revenue forecast that beat analysts' average estimates, investors were expecting more.

The market, which has seen a strong rally, is once again faced with a choice between risk and caution as global events add uncertainty.

Tech Under Pressure: Nasdaq Slightly Down
The information technology sector was under pressure, ending the session down 0.23%, which affected overall investor sentiment. The tech-heavy Nasdaq lost 0.11%, showing that confidence in the segment has weakened somewhat.

Target: Drops in Gift Season
Target shares plunged 21.4% after the company issued holiday sales and profit guidance that fell short of analysts' expectations. The company's weak third-quarter results added to investor disappointment.

Target's decline also weighed on the consumer discretionary index, which lost 0.57% on the day and was the worst performer in the sector.

Tesla and Amazon are down
Tesla shares fell 1.15% and Amazon lost 0.85%, indicating that investors are taking a cautious approach to growth assets. These companies, which had previously been leaders in their segments, are now facing more subdued expectations.

Indices: Mixed Results
Among the major indices, the Dow Jones Industrial Average managed to rise 139.53 points (+0.32%), closing at 43,408.47. The S&P 500 showed almost zero dynamics, adding a symbolic 0.13 points, and the Nasdaq Composite fell by 21.32 points (-0.11%) to 18,966.14.

Nvidia: a leader or a source of risk?
Despite the decline in Nvidia shares during the last session, its annual dynamics remain impressive: since the beginning of the year, the shares have almost tripled their value. According to BofA Global Research, this has brought about 20% of the return of the entire S&P 500 index over the past 12 months.

Artificial intelligence: prospects and challenges
"Companies are starting to share successful cases of using AI, showing how investments in new technologies bring additional income or help reduce costs," analysts comment. However, investors are cautious, preferring to wait for confirmation of the sustainability of these trends.

The market is entering a new phase where high expectations collide with the reality of results, and geopolitical instability continues to shape sentiment.

MicroStrategy and MARA Holdings: Rapid Growth
MicroStrategy shares soared by 10%, while MARA Holdings showed an even more impressive growth of 13.9%. These companies linked to the cryptocurrency sector received support amid improving investor sentiment and growing interest in digital assets.

Central Bank: December Intrigue
Traders have increased expectations that the Federal Reserve will not raise rates at its December meeting. This opinion was formed amid the publication of strong economic data that shows the economy is stable despite persistent inflation.

NYSE and Nasdaq: The odds are stacked against the downside
On the New York Stock Exchange (NYSE), decliners outnumbered gainers by a 1.24-to-1 ratio, with 184 new highs and 94 new lows. On the Nasdaq, the story is similar: 2,245 stocks fell, compared to 2,007 gainers, for a ratio of 1.12-to-1.

The S&P 500 posted 30 new 52-week highs and 13 new lows, while the Nasdaq Composite posted 92 new highs and 163 new lows, underscoring the overall trend of uncertainty in the market.

Trading Activity: Volumes Decline
Total trading volume on U.S. exchanges was 13.2 billion shares, below the 20-day average of 14.32 billion. This indicates some caution among traders in the current market conditions.

Global Markets: Balancing Act
On the international stage, stocks showed a moderate decline, as traders continued to take into account the growing geopolitical tensions between Russia and the West.

Meanwhile, Bitcoin set a new record, demonstrating investor confidence in cryptocurrencies. The dollar also strengthened after three days of decline, which became an additional signal of a change in sentiment in the currency markets.

The financial world once again demonstrates a complex interplay of factors, where global events, economic data and central bank actions are intertwined into a complex picture of uncertainty.

Market ends the session with variable dynamics
The S&P 500 index ended trading virtually unchanged, reflecting neutral investor sentiment. The Dow Jones turned out to be in the green, while the Nasdaq showed a decline, continuing the correction after the recent rally.

Among the leaders of growth, shares of companies from the healthcare, energy and materials sectors stood out. In contrast, consumer staples, financials and technology stocks were weak, becoming the session's main losers.

Global indices: moderate decline
The MSCI All-World Index, which measures the overall performance of global markets, fell 0.16% to 847.84. European stocks also ended the day lower, although the decline was minimal, down 0.02%.

Nvidia: pressure from high expectations
Investors were watching Nvidia shares closely, which came under some pressure after the release of quarterly results. Despite the decline, the situation was not catastrophic, said James St. Aubyn, chief investment officer at Ocean Park Asset Management.

"Nvidia remains a key player in the market, but expectations are rising each quarter and they are becoming increasingly difficult to meet. We are at that point where high expectations are starting to put pressure," St. Aubyn added.

Outlook: Market at a crossroads
The session showed that market participants remained cautious, balancing expectations for further growth with concerns related to geopolitics and corporate results. Global stocks reflected the general tension, with investors weighing local and global risk factors.

This week promises to be eventful, and the coming days may provide clearer signals about the direction of markets in the near future.

Gold and bonds: a safe haven for investors
Gold and government bond prices continued to rise on Tuesday, as markets reacted to the escalation of the conflict between Ukraine and Russia. Such news caused increased demand for safe assets.

Gold: triumph of the third session
Gold prices reached a weekly high, continuing to rise for the third trading session in a row. Spot gold increased by 0.69%, reaching $2,649.89 per ounce. U.S. gold futures showed a similar gain of 0.8%, reaching $2,651.70.

The rise in gold prices reflects investors' appetite for conservative strategies amid global instability.

Treasury Secretary Appointment: Intrigue in Focus
Also in focus is Donald Trump's choice for Treasury Secretary, which is expected to be announced as early as Wednesday.

"The market is recognizing that some of Trump's policies, such as tariffs and deportations, carry inflation risks," said Lukasz Tomicki, co-founder of LRT Capital in Austin, Texas. Bond yields have risen sharply since the election, confirming market participants' expectations.

Dollar: Recovering from Losses
The dollar index rose 0.54% to 106.68, snapping a three-day losing streak, although current levels remain below a one-year high.

The dollar also gained against key currencies, up 0.48% against the yen to 155.40 and 0.2% against the Swiss franc to 0.88410. The dollar index has gained nearly 3% since the November 5 election, underscoring confidence in the U.S. economy.

Global markets are on hold: geopolitical tensions, monetary policy and personnel decisions in the US continue to influence asset movements. The latest statements and actions by leaders can radically change the trajectory of investor sentiment.

Yuan under pressure: the market reacts to the central bank's decision
The Chinese yuan weakened against the dollar after the People's Bank of China decided to leave its base lending rates unchanged, as analysts had predicted. In the offshore market, the yuan lost 0.22%, falling to 7.251 per dollar. Such a decline reflects the general caution of investors in the context of stable monetary policy in China.

Bitcoin: a new ascent to records
The cryptocurrency surprised the markets again, reaching a new record level just below $95,000. During the last session, the price of bitcoin rose by 2.53%, reaching $94,579.01. Bitcoin has risen more than 30% since Donald Trump was elected. Market participants attribute this growth to expectations of more favorable regulation of the cryptocurrency sector under the new administration.
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[KostiaForexMart]

Riding the Crest of a Wave: Nvidia Boosts Wall Street, Bitcoin Challenges $100K, Dollar High

Stock Markets Recover After Unsettled Trading
World stock indexes rose on Thursday despite mixed sentiment among investors. The main topic of trading was Nvidia's forecasts, which, while still positive, fell short of market expectations. At the same time, Bitcoin continued its confident movement, approaching the psychological mark of $100,000.

Nvidia: records and disappointment
Shares of Nvidia (NVDA.O), a company whose technologies are shaping the future of artificial intelligence, started the session with an impressive takeoff, reaching a historical maximum. However, their dynamics later slowed down, and by the end of the day, growth was only 0.53%. Investors were concerned about the company's forecasts: the expected revenue growth was the most modest in the last seven quarters.

"Nvidia's results are still impressive, but the lack of brighter prospects for the fourth quarter may have cooled the market's enthusiasm a little," commented Garrett Melson, portfolio strategist at Natixis Investment Managers.

Wall Street: growth despite losses of giants
On American exchanges, the session ended on a positive note. Major indexes rose, led by gains in utilities, financials, consumer discretionary and industrials. However, communications services remained in the red, led by significant losses in Alphabet (GOOGL.O), which fell 6%.

Alphabet faces a new challenge as US authorities demand Google abandon its Chrome browser to eliminate its dominance in internet search. The lawsuit has left investors nervous and the tech giant's shares tumbling.

More challenges ahead for the market
Despite the upbeat close, investors continue to closely monitor corporate forecasts and the macroeconomic situation. Bitcoin expectations and the future performance of the largest tech companies remain the main themes for the market.

Dow triumphs, Nasdaq moderately gains
US stock indexes ended the session with varying degrees of growth. The Dow Jones Industrial Average added 1.06% to 43,870.35, posting a solid gain. The broad-based S&P 500 rose 0.53% to 5,948.71. The Nasdaq Composite, however, was relatively flat, up a modest 0.03% to 18,972.42.

Europe: Tech, Energy Lead Gains
The MSCI Global Index, which tracks stocks around the world, also showed positive momentum, adding 0.38% to 851.05. However, the day was choppy as uncertainty swept the markets. European stocks, as represented by the STOXX (.STOXX), rose 0.41%, led by a rally in the tech and energy sectors.

"There's a bit of a news vacuum in the market right now, which makes it hard to pinpoint a clear direction," said Garrett Melson, portfolio strategist at Natixis Investment Managers.

Bitcoin Heads for $100,000
The cryptocurrency market continues to impress, with Bitcoin, the world's largest digital currency, steadily heading toward the $100,000 mark. It has gained 3.75% in the past 24 hours to reach $98,005. Bitcoin has gained more than 40% since Donald Trump won the presidential election on November 5. Investors attribute this momentum to expectations that the new administration will be favorable to cryptocurrencies.

Ethereum Gains Strength
It's not just Bitcoin that's showing strength: Ethereum is also showing remarkable results. The cryptocurrency has gained 8.77% to end the day at $3,350.80.

Treasury Secretary in Investors' Crosshairs
Markets are tensely awaiting the appointment of the Treasury Secretary in the new Trump administration. The choice will be key to implementing policies that include tax cuts, deregulation, and tariff initiatives.

Global markets are currently awaiting new guidance, with cryptocurrencies already betting on a looser economic policy. Investors continue to closely monitor Trump's actions and their impact on the global financial arena.

A strong labor market supports the dollar
The US dollar rose amid an unexpected decline in jobless claims, indicating a resilient labor market. An additional factor was the statements by Federal Reserve officials, who emphasized the possibility of further interest rate hikes.

However, currency movements were mixed. The dollar fell 0.62% against the Japanese yen, falling to 154.45, but strengthened against the Swiss franc by 0.29%, reaching 0.887.

Dollar Index on the Rise
The dollar index, which tracks the dollar against a basket of major currencies, rose 0.37% to 107, its highest in 13 months. The euro, by contrast, weakened, losing 0.41% to $1.0479.

Russia and Ukraine Shake Up Oil Markets
Oil prices jumped sharply, gaining about 2%, after reports of a missile exchange between Russia and Ukraine, raising concerns about the stability of crude supplies to the global market.

Brent crude futures rose 1.95% to $74.23 a barrel, while WTI futures added 2% to $70.10. Investors are worried that geopolitical tensions could continue to push prices higher.

Fourth straight session of growth
The gold market is showing positive dynamics, strengthening its position as a safe-haven asset. Spot gold rose by 0.8%, reaching $2,671.28 per ounce. US gold futures also went up, adding 0.9% and reaching $2,674.90.

Gold's growth is accompanied by increasing interest from investors who are looking for stability in the face of global economic uncertainty and geopolitical risks.

Financial markets: new challenges and opportunities
The combination of economic factors such as a strong labor market and the Fed's comments with geopolitical risks creates a volatile but opportunity-rich environment for investors. Currency and commodity markets continue to react to the rapidly changing news background, making strategy selection key to success.

Why the US retains its leadership?
US stocks continue to strengthen their positions, significantly outperforming global peers. Investors associate this with hopes for the implementation of the economic program of President-elect Donald Trump. But the key to success will be the administration's ability to avoid escalating trade tensions and keep the budget deficit under control.

The S&P 500 (.SPX) has risen an impressive 24% in 2024, outpacing the major benchmarks in Europe, Asia and emerging markets. The premium of the US index over the MSCI index of more than 40 countries has reached 22 times expected returns, according to LSEG Datastream. This is the largest gap in the last 20 years.

Tech and Economy on the US Side
Despite more than a decade of US stock dominance, the gap has widened this year, thanks to robust US economic growth and strong corporate earnings. The tech sector continues to be a driving force, with the excitement around artificial intelligence driving growth for companies such as Nvidia (NVDA.O).

A New Wave of Investing in Technology
Nvidia, a recognized leader in AI chips, continues to be a bellwether for tech companies. The success of Nvidia and other players in the industry shows that investors are betting on the future of tech, which will be defined by artificial intelligence.

"The US stock market is currently playing to its strengths: innovation, corporate profits, and economic resilience," analysts say.

How long will the US maintain its leadership?

While the current situation seems optimistic, the market is not immune to risks. Investors are closely monitoring the steps of the new administration, especially on tax policy, tariffs, and the budget. Any deviation from this course could be a turning point for the market.

Global Competition: Can the World Catch Up with the US?
While other regions, including Europe and emerging markets, are struggling with challenges such as slowing economic growth and geopolitical instability, the US continues to set the standard. However, the competition is not abating, and global markets may start to close the gap in the coming years.

US stocks remain at the top, but the question is how long this position will last. Investors should be prepared for changes and watch developments closely.

Taxes, deregulation and tariffs: a recipe for success?
Donald Trump's economic platform of tax cuts, deregulation and the use of tariffs as leverage has provoked mixed reactions. However, many experts believe that these measures can strengthen the US leadership on the global stage, despite possible side effects such as inflation and trade conflicts.

"Given the stimulative nature of the new administration's policies, US stocks will struggle to find worthy rivals at least until the end of 2025," says Venu Krishna, head of US equity strategy at Barclays.

Investors vote for the US
Following the November 5 election, inflows into US equity funds have reached record levels. In the week since the vote, investors have poured more than $80 billion into U.S. assets. By contrast, European and emerging markets have seen significant capital outflows, according to Deutsche Bank.

This shift in priorities reflects growing confidence in the U.S. market amid expectations for higher returns and stability.

U.S. companies continue to dominate
One of the main reasons for the resilience of the U.S. market is impressive corporate earnings growth. LSEG Datastream forecasts S&P 500 earnings to grow 9.9% in 2024 and 14.2% in 2025.

By comparison, Europe's Stoxx 600 index is expected to grow more modestly: 1.8% this year and 8.1% next year. The gap underscores the U.S. lead in corporate profitability.

"America remains the region that has the highest earnings growth and maintains strong profitability," says Michael Arone, chief investment strategist at State Street Global Advisors.

What's next for the market?
Experts note that even if global markets begin to catch up with the US, the US market will remain a key point of attraction for investors due to its sustainable growth and pro-business policies.
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[KostiaForexMart]

EUR/USD: parity in the risk zone

Donald Trump's return to the political arena is alarming for investors, since his economic views, as during the previous presidency, are clearly nationalistic in nature.

The EUR/USD pair fell sharply, reaching a two-year low, due to fears that the trade wars that Trump will inevitably resume will lead to an economic crisis in the eurozone. Economic indicators confirmed the deterioration of the situation: the composite PMI fell below the 50 mark, signaling a reduction in economic activity.

In this regard, markets expect a more aggressive monetary policy of the European Central Bank, which may lead to a fall in the euro to parity with the dollar. Such a scenario was already implemented in 2022 during the outbreak of the military conflict in Ukraine, when the euro weakened amid the energy crisis.

Previously, a similar situation was observed in 2016, when the dollar rose sharply after Trump's election victory, and then weakened by 2017. Such dynamics may be repeated, especially if the minutes of the October Fed meeting turn out to be «dovish» and inflation in Europe decreases.

At the moment, the dollar is holding at 107, and the euro is 104.
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China resists Trump's pressure by strengthening the yuan

The Chinese authorities are facing new tariff threats from US President-elect Donald Trump and are strengthening control over the yuan exchange rate.

Immediately after the end of the US elections, the People's Bank of China began to set the daily reference rate of the yuan above 7.2 per dollar, despite dollar fluctuations and analysts' expectations that the central bank would weaken the currency.

Such actions by the central bank are reminiscent of the tensions that characterized Trump's first term, but now the stakes are even higher. China is balancing between the desire to protect its currency and the need to stimulate economic growth. This forces the central bank to seek a balance between too strong and too weak yuan exchange rate.

Experts believe that the People's Bank of China will keep the yuan relatively stable against the dollar, as it was before. In response to the imposition of additional tariffs, China will rely more on domestic incentives rather than currency devaluation.
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The main events by the morning: November 27

The Russian ruble continues to weaken, despite the support from tax payments and stable oil quotes. On the Moscow Exchange, the yuan has exceeded the mark of 14.5 rubles, and the dollar is approaching the level of 106 rubles. The decline in the Russian currency is due to several factors: the aggravation of the geopolitical situation, new sanctions complicating foreign trade calculations, increased demand for imports and rising budget expenditures, as well as the strengthening of the dollar on world markets.

Biden secretly requested an additional $24 billion from Congress to help Ukraine. Of this amount, $16 billion is supposed to be spent on replenishing American weapons stocks, and the remaining funds will be sent directly to Ukraine. Republicans opposed it, accusing Biden of trying to disrupt Donald Trump's possible peace initiatives to resolve the conflict.

Walmart has abandoned the policy of inclusivity, the company's shares are growing. Walmart announced the termination of its support for diversity and inclusivity policies, including severing ties with the Center for Racial Equality and withdrawing from the LGBT rights index (the organization is recognized as extremist and banned in the Russian Federation). Against the background of this decision, the company's shares have been showing growth over the past two days.

The ceasefire agreement between Israel and Hezbollah has entered into force. Israel and Hezbollah have officially stopped fighting in accordance with the new peace agreement. The agreement provides for the gradual control of the Lebanese army over the border territories with the support of the UN Interim Force in Lebanon. Israel, in turn, has pledged to withdraw its troops from southern Lebanon within two months.

The Trump team is evaluating the possibility of direct talks with Kim Jong Un as part of a «new diplomatic push.» Trump's main goal is to restore communication channels between Washington and Pyongyang, but further political contacts and their schedule have not yet been established. It is also noted that these efforts can reduce the risk of armed conflict.
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Inflation and weak tech forecasts: Why Wall Street markets closed lowe

Wall Street investors react with losses: Nasdaq in the red amid inflation fears
Yesterday's trading on Wall Street ended with losses for all major indices, with the Nasdaq among the leaders of decline. The tech sector suffered significant losses ahead of Thanksgiving as traders grew concerned that the Federal Reserve might back off from aggressive rate cuts amid lingering inflation concerns.

Strong Data, Weak Progress
The U.S. economy posted solid growth figures, with consumer spending data showing a strong increase in October. However, despite the positive results, efforts to reduce inflation appear to be running into trouble, adding to traders' concerns that the Federal Reserve could take a more cautious stance on interest rates.

Markets Expect Fed to Be More Tight
Traders on CME's FedWatch platform have increased their bets by 25 basis points, according to the latest calculations, in anticipation that the Federal Reserve will cut rates at its December meeting. However, rates are expected to remain unchanged in January and March.

New Trade Threats and Their Impact on the Market
Investors are also concerned about the new possible economic consequences of President-elect Donald Trump's statements, who proposed introducing new tariffs on goods from Mexico, Canada, and China. These measures will remain in place until countries take the necessary steps to combat illegal migration and drug trafficking. In particular, Trump announced 25% tariffs on Mexican and Canadian imports and 10% on Chinese goods if countries do not take action against fentanyl and illegal migrants.

Risks to Inflation: Experts' Opinions
Economists at Goldman Sachs expressed concern about the possible long-term consequences of this approach. In their recent report, they warned that further escalation of tariff policy could delay inflation's return to the 2% target. These risks put additional pressure on markets, increasing uncertainty in the economic situation.

Unresolved Issues and Uncertainty in Markets
So, amid strong economic data, trade threats and uncertainty over Fed policy, investors continue to search for clear guidance, which in turn continues to influence the behavior of markets.

Wall Street ends the day lower: Tech sector under pressure
On Wall Street, indices closed lower on Wednesday, weighed down by strong economic data and concerns about the future policy of the Federal Reserve. The Dow Jones Industrial Average (.DJI) fell 138.25 points, or 0.31%, to close at 44,722.06. The S&P 500 (.SPX) lost 22.89 points, or 0.38%, to close at 5,998.74. The Nasdaq Composite (.IXIC) was the biggest loser, falling 115.10 points, or 0.60%, to 19,060.48.

Global markets also under pressure

It wasn't just U.S. stock indexes that suffered a decline. The MSCI index, which tracks global markets (.MIWD00000PUS), lost 0.10%, falling 0.84 points to 858.24. In Europe, the STOXX 600 (.STOXX) ended the day down 0.19%, also confirming the trend of global market sentiment weakening.

Tech sector on the brink of collapse
Stocks of major players in the tech sector attracted particular attention in the markets. For example, Dell (DELL.N) shares fell 12% after the company published disappointing forecasts for quarterly results. HP (HPQ.N) shares also fell 6%, weighing on the overall sentiment in the information technology sector. The sector's index (.SPLRCT) fell 1.2%, highlighting the weakness of the leading tech giants.

Megacaps fall: Nvidia and Microsoft in the red
The biggest tech companies were not spared the negative trends either. Nvidia (NVDA.O) and Microsoft (MSFT.O) shares showed significant declines, which exacerbated the overall decline in the sector. The Philadelphia SE Semiconductor Index (.SOX) lost 1.8%, showing a weak performance for one of the most profitable industries.

Growing interest in small caps, but muted growth in Russell 2000
At the same time, the Russell 2000 index (.RUT), which tracks small company stocks, was a bit on the sidelines of the general decline. After a record high earlier in the week, the index rose by 0.1%, which was the only positive moment among the major stock indices on the trading day.

Results of the day: markets await further signals
So, the latest trading on Wall Street demonstrated restraint among investors. Amid uncertainty related to possible decisions of the Federal Reserve and the state of the global economy, market participants tend to be cautious. Amid weak forecasts for the largest tech companies and uncertainty around tariff policy, the influence of these factors continues to affect investor sentiment.

Investors react to economic data: high growth rates and caution from the Fed
Markets continued to demonstrate restrained sentiment despite positive economic data. Investors were closely watching reports that showed the U.S. economy continued to grow at a solid pace in the third quarter. Notably, new jobless claims fell again last week, bolstering expectations that the Federal Reserve could cut rates in December.

Inflation in Focus: Fed Faces Choice
However, despite the strong macroeconomic data, inflation remains under pressure. Scott Welch, chief investment officer at Certuity, noted that inflation was slightly above the Fed's desired levels, casting doubt on the possibility of further rate cuts. In his view, this could force the Fed to adopt a more cautious stance.

Trump Tariff Policy: A New Challenge for the Economy

Investors are also concerned about the possible impact of President Donald Trump's tariff policy. Welch stressed that if the proposed tariffs are implemented, they could exacerbate inflationary pressures, which in turn would complicate the task for the Fed, which must balance economic data with the policy initiatives of the new administration.

Uncertainty at the Fed meeting: Will rates be cut?

The minutes of the Federal Reserve's November meeting, released on Tuesday, showed that Fed members remain divided on the issue of future rate cuts. Despite the positive data, they are still unsure how much current rates are constraining economic growth and what approach to take in response to inflation threats and external risks.

S&P 500 on the verge of historic gains, but not without difficulties
Despite these difficulties, the S&P 500 continues to gain strength, heading for its biggest monthly gain in all of 2024. The reading also marked the sixth straight month of gains in seven months, underscoring positive expectations about the impact of President Trump's economic policies on local businesses and the broader economy.

Investor Disappointment: Workday Shares Slip
Not all sectors of the market are seeing positive results, however. Workday (WDAY.O) shares fell 6.2% after the company reported weaker-than-expected subscription revenue guidance. Weak customer spending on its human capital management software weighed on the stock and the broader tech sector.

Takeaway: Uncertainty and Balancing Act
Overall, the market remains in a state of uncertainty, given both economic factors and political risks related to U.S. foreign trade policy. The Federal Reserve, in turn, will be forced to find a balance between supporting growth and controlling inflation, which will be an important factor in determining the future direction of the stock market in the coming months.

US Stock Market: Stock Performance and Holiday Expectations
The New York Stock Exchange saw a predominance of positive sentiment among stocks on Wednesday. The number of advancing stocks significantly outnumbered the decliners, with a ratio of 1.64 to 1. At the same time, the number of new highs on the NYSE reached 406, while there were only 54 new lows. This indicates that most stocks on the exchange continued to move higher.

S&P 500 and Nasdaq: New Highs Amid Market Activity
The S&P 500, in turn, noted 79 new 52-week highs, while not recording a single new low. This confirms the resilience of the index's main stocks. The Nasdaq Composite demonstrated even more noticeable growth, recording 136 new highs and 71 new lows, which also reflects positive sentiment in the tech sector.
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The main events by the morning: November 29

Steelmaking is declining in Russia. According to data for January-October 2024, steel production decreased by 7% compared to the same period last year and amounted to 59.1 million tons. The largest drop was shown by Magnitogorsk Iron and Steel Works (MMK) – by 12% and Severstal – by 8%.

China will restrict exports of tungsten, an important metal used in weapons and semiconductors starting December 1. The new rules require export licenses, which is associated with increased control over dual-use goods. These measures are being taken against the background of strained relations with the United States, which will ban its contractors from purchasing tungsten from China from 2027.

The head of the Russian Defense Ministry arrived in North Korea today. During the visit, a number of meetings with representatives of the military and military-political leadership of the DPRK are planned to discuss bilateral cooperation.

The Japanese Prime Minister announced his desire to conclude a peace treaty with Russia. After the outbreak of hostilities on the territory of Ukraine, Japan imposed sanctions against Russia, which is why Moscow refused to negotiate the status of the Kuril Islands and conclude peace. In his speech, the Prime Minister did not mention the decision to maintain these sanctions until the end of hostilities.

The Brazilian real has updated its historical low on concerns about state finances. Paired with the US dollar, the rial fell to 5.9998 per dollar. Investors are evaluating the long-awaited measures of the administration of Brazilian President Luiz Inacio Lula da Silva to ensure budget balance: spending cuts of 70 billion reais ($12 billion), personal income tax exemption for people with the lowest wages and an increase in this tax for high-income people.
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