A daily summary and commentary of events and factors that affect the global markets, with a particular emphasis on the foreign exchange markets.
Adding More Wood to the Fire
Share this story:
Alan Rose Foreign Exchange Head Trader
Markets remain volatile and chaotic even as we wind down toward a holiday week. The Fed’s tone deafness and disdain for the markets in Wednesday’s FOMC announcement and press conference have caused U.S and global equities to continue to falter. Investors are becoming increasingly concerned about a global slowdown and weaker growth and earnings as we head into 2019 combined now with a Fed error. The DJI and S & P indexes are having their worst December since 1931!
Overlaid on top of all this uncertainty for the future is more chaos emanating from Washington. Markets are still reeling from the FOMC announcement and now must contend with a potential government shutdown, a withdrawal of U.S. troops from Syria, and the resignation of Defense Secretary Mattis. Politics and the markets can be a very combustible mix.
This morning when I awoke and checked the markets, I was shocked to see the U.S. dollar (DXY) actually stronger after yesterday’s rout. Despite all the negatives that I have just discussed, apparently investors still see U.S. Treasuries as a favored safe haven in these stressful times. How long the U.S. will remain a safe haven when the source of the uncertainty and risk is the U.S. itself remains to be seen. We remain concerned about the U.S. dollar and advocate for importers to be more aggressive in buying currencies.
HERE ARE THE KEY NEWS STORIES FROM OVERNIGHT:
U.S. Durable Goods Orders for November came in below consensus rising by 0.8% against expectations of a gain of 1.6%. October’s Durable Goods orders fell by 4.3%; this series is particularly volatile related to aircraft orders. Final U.S. Q3 GDP came in slightly weaker at 3.4% after the initial print of 3.5%.
Canadian GDP for October rose by 0.3% which is the fastest pace in five months on a boost from manufacturing. The Canadian dollar is weaker on the back of a stronger dollar and weaker commodity prices.
Want to learn more about international finance, economics, and global events? Sign up for our other Foreign Exchange emails and videos!
Follow City National Bank on social media:
Investment and Insurance Products:
Are Not insured by the FDIC or any other federal government agency
Are Not deposits of or guaranteed by a Bank or any Bank Affiliate
May Lose Value
This report is for general information and education only and was compiled from data and sources believed to be reliable. City National Bank does not warrant that it is accurate or complete. Opinions expressed and estimates or projections given are those of the authors as of the date of the report with no obligation to update or notify of inaccuracy or change. This report is not a recommendation or an offer or solicitation to buy or sell any financial instrument discussed. It is not specific investment advice. Financial instruments discussed may not be suitable for the reader. Readers must make independent investment decisions based on their own investment objectives and financial situations. Prices and financial instruments discussed are subject to change without notice. Instruments denominated in a foreign currency are subject to exchange rate and other risks. The Bank (and its clients or associated persons) may engage in transactions inconsistent with this report and may buy from or sell to clients or others the financial instruments discussed on a principal basis. Past performance is not an indication of future results. This report may not be reproduced, distributed or further published by any person without the written consent of City National Bank. Please cite source when quoting.
Now accepting scholarship apps Celebrating 40 years of service -- A loan to an innovative company -- Affording your dream home -- Mergers and a new branch in Raleigh View this email in your browser Forward to a friend
Your Market News update for May 30, 2019 | View online Market News News that's moving the market now As Trade-War Worries Linger, Market Seems to Lack Buying Conviction May 30, 2019 8:40 AM | JJ Kinahan 6 min read | Daily Market Update