Market Movers of the Day
Europe
Germany’s ifo Business Climate index beat analyst’s expectations and came out at 93.90
England’s BBA Mortgage Approvals worse than expected at 42.20k
England’s Business investment better than expected at -3.0%
Americas
Revised GDP worse than expected at 2.8%
CB consumer confidence better than expected at 49.50
Daily Market Review Nov 25th
After Monday’s dramatic rally, the major indices eased their pace yesterday, closing the session in red. Even though a minor pull back was expected by most investors, many expressed concerns that the current equity rally is now running only on steam. One must note that even though various sectors are now showing improvement, the employment situation is still weighing on investor’s thoughts and on the economic situation.
According to a recent statement from the Fed, consumer consumption is picking up, but the economy should witness a slow recovery, due to the high level of unemployment. The Fed also mentioned that without further stimulus from the government, the U.S could find it hard to recover to a normal and healthy situation. According to yesterday’s revised economic data the U.S expanded by 2.8%, a number which was under analyst’s expectations of 2.9% and lower than the previous figure of 3.5%.
President Obama also expressed his concerns yesterday, stating that even though the economy could require further stimulus, additional debt could lead to a drop in confidence which could lead to a double dip recession.
From a technical point of view the major U.S stock indices finished the session around recent high levels. The S&P500 closed with a -0.05% loss, while the Nasdaq dropped by 0.31%
Forex
On the Forex market the Dollar index continued to present relative weakness, as the equity market presented a lackluster session. Throughout the session the Dollar dropped to below 75 points and closed around prior support.
Over in Europe, France and Germany both presented better than expected data. Germany’s ifo Business Climate Index jumped to 93.90, beating analyst’s expectations of 91.90. France’s consumer spending surprised for the better, showing that the change in the total expenditure by consumers had increased in the month of November by 0.5%.
The data helped to spark buying on Euro crosses and sent the EUR/USD to higher levels. Even though the EUR/USD is now showing signs of a possible break out, one must take into consideration resistance at $1.5071.
Over in the U.K, the data was mixed as BBA Mortgage Approvals increased by only 42.20k, while Business investment contracted by less than expected at -3%. The GBP/USD managed to find stability throughout the session and climbed higher to close just under its opening price. The GBP is now gaining strength during early morning hours.
The Day Ahead
On the data front, the U.K will take the stage first today, releasing its revised GDP figure. The number is expected to show a contraction of -0.3%. Moving on, the U.S will release a wave of data which include their Durable Goods orders, initial jobless claim, personal spending, income and new home sales. Although most of the data is expected to show an improving situation the data could surprise and cause volatility during the intraday session.
One must note that the initial jobless claims will be scrutinized by investor’s, especially due to the employment situation in the U.S.
Daily Forex Market Analysis provided by eToro
Disclaimer: Trading in the Foreign Exchange market might carry potential rewards, but also potential risks. You must be aware of the risks and are willing to accept them in order to trade in the foreign exchange market. Don’t trade with money you can’t afford to lose.
