CFD Markets News and Forecasts — 11-10-2018

Major US stock indexes fell sharply, which was caused by a decrease in stocks of the financial sector and the industrial goods sector.

Pressure on the market also had weak inflation data for the United States. The Labor Department reported that consumer prices rose slightly in September, a sign that inflationary pressure remains under control, as a strong dollar holds import prices, while energy costs are declining. The consumer price index in September rose by 0.1% after rising in August by 0.2%. Economists had expected consumer prices to rise by 0.2%, while base prices would also rise by 0.2%. Excluding unstable food and energy categories, so-called basic consumer prices rose by 0.1%, which corresponds to the same pace as in August.

Almost all DOW components recorded a decline (29 of 30). Pfizer Inc. shares turned out to be an outsider. (PFE, -3.70%). Only shares of Microsoft Corporation (MSFT, + 0.11%) rose.

All sectors of the S & P finished trading in the red. The largest decline was shown by the financial sector (-2.1%).

At the time of closing:

Dow 25,052.83 -545.91 -2.13%

S & P 500 2,728.37 -57.31 -2.06%

Nasdaq 100 7,329.06 -92.99 -1.25%

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 6.0 million barrels from the previous week. At 410.0 million barrels, U.S. crude oil inventories are at the five year average for this time of year.

Total motor gasoline inventories increased by 1.0 million barrels last week and are about 7% above the five year average for this time of year. Finished gasoline inventories decreased while blending components inventories increased last week.

Distillate fuel inventories decreased by 2.7 million barrels last week and are about 4% below the five year average for this time of year. Propane/propylene inventories increased by 1.5 million barrels last week and are about 7% below the five year average for this time of year. Total commercial petroleum inventories increased last week by 11.3 million barrels last week.

• Economists Increasingly Confident of Fed Rate Hikes

• Most Economists See No Impact on U.S. Growth, Manufacturing Jobs From Nafta Rewrite

• Over 70% of Economists Polled Expect No Change in Growth Due to Trade Deal

• Over 50% of Respondents Expect No Impact on U.S. Manufacturing Jobs

U.S. stock-index futures were flat on Thursday, as the release of weaker-than-expected inflation data helped them to recover most of the premarket losses.

Global Stocks:

(company / ticker / price / change ($/%) / volume)

In August, builders in 18 of the 27 census metropolitan areas (CMAs) surveyed reported flat or decreasing prices. The Canada-level index stood at 103.3 in August and has not risen above that mark since November 2017. Mortgage rate increases, along with tighter mortgage regulations, are likely contributing to the flatness observed across Canada.

Ottawa's new housing market (+0.6%) registered the largest month-over-month gain in August. This was the 11th consecutive monthly price rise in that CMA, coinciding with an increasingly tight resale market. According to the Canadian Real Estate Association, new listings were down 8.5% in August compared with the same period in 2017.

In the week ending October 6, the advance figure for seasonally adjusted initial claims was 214,000, an increase of 7,000 from the previous week's unrevised level of 207,000. The 4-week moving average was 209,500, an increase of 2,500 from the previous week's unrevised average of 207,000.

The advance seasonally adjusted insured unemployment rate was 1.2 percent for the week ending September 29, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending September 29 was 1,660,000, an increase of 4,000 from the previous week's revised level

• Total Global Oil Supply Rose to 99M B/D in September

• Iran Crude Production Fell 150,000 B/D in September

• Russian Crude Output Rose 150,000 B/D in September

• Crude Output Rose by 132,000 B/D in September

The Consumer Price Index increased 0.1 percent in September on a seasonally adjusted basis after rising 0.2 percent in August, theU.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index rose 2.3 percent before seasonal adjustment.
The shelter index continued to rise and accounted for over half of the seasonally adjusted monthly increase in the all items index. The energy index declined 0.5 percent in September after rising in August. The food index was unchanged in September, as an increase in the index for food away from home offset a decline in the food at home index.

The index for all items less food and energy rose 0.1 percent in September, the same increase as in August. The shelter index increased 0.2 percent, and the indexes for apparel, motor vehicle insurance, recreation, and airline fares also rose. The medical care index increased as well, though its components were mixed.
The all items index rose 2.3 percent for the 12 months ending September, a smaller increase than the 2.7-percent increase for the 12 months ending August.

While further trade tensions between the US and China would have a negative credit effect on European companies, the impact would be mitigated by the EU's small direct trade exposures, the global footprint of many rated European companies and lower Chinese tariffs on some EU products, Moody's Investors Service said in a report today.

In Europe, the companies most vulnerable to supply chain disruptions are those in the transport equipment, electrical and optical equipment, chemicals and metal product sectors.

The report, "Corporates -- Europe: Trade tensions will modestly disrupt Europe's trade flow with the US and China", is available on www.moodys.com. Moody's subscribers can access the report using the link at the end of this press release. The research is an update to the markets and does not constitute a rating action.

"A continuation of the escalating trade tensions between the US and China will modestly disrupt the trade flows between Europe and its two major trade partners," said Ruosha Li, a Moody's Analyst and the report's co-author. "However, a number of factors will lessen the negative effect of trade disruption on EU companies."

• Lower Growth Forecast Due to Weaker Global Economy

• Domestic Demand is Important Growth Pillar, Trade Uncertainties Weigh on Economy

• Cuts 2019 Growth View to 1.8% vs. 2.1% Seen Previously

• Govt Sees German Export Growth at 2.8% in 2018, 3.7% in 2019

• German Import Growth at 3.6% in 2018, 4.9% in 2019

• Sees Private Consumption Up 1.7% in 2018, Up 1.9% in 2019

• In Talks With India Over Oil Market Concerns

• Shares Common Interest, Wants to Reach Understanding With U.S.

• Concerns Oil Stocks Could Rise Again Next Year

• Cut Global Oil Demand Growth Forecast to Below 1.5M B/D in 2019

• Partners Have Signed Corresponding Agremeent

• Deal Subject to Authorities' Approval, Consent of Brilliance China Shareholders' Meeting

• Partners Agreed on a Purchase Price of an Equivalent of EUR3.6 Billion for BMW's Additional JV Stake

• Extended Contract Is Valid for 22 Years, From 2018 to 2040; The JV's Existing Contractual Term Was Set to Expire in 2028

• JV to Invest More than EUR3 Billion in New, Existing Plant Structures in Shenyang Over Coming Years

• Total Annual Capacity of BMW Autos at JV Plants to Gradually Increase to 650,00 Units Starting in Early 2020s, Creating 5,000 New Jobs

• Intends to Continue to Expand China Localization of Additional Models Including New Energy Vehicles, or NEVs

• Deal's Closing to Result in JV Being Fully Consolidated in BMW Group's Financial Statements; Expected to Have Positive Valuation Effect in FY of Closing

• Lenders reported that the availability of secured credit to households had decreased in the three months to end‑August 2018 (Q3) and was expected to decrease again over the next three months to end‑November 2018 (Q4).

• The availability of unsecured credit to households was reported to have decreased slightly in Q3 and was expected to decrease further in Q4. Credit scoring criteria for total unsecured loan applications were reported to have tightened in Q3, although the proportion of applications approved increased.

• The overall availability of credit to the corporate sector was reported to have been unchanged in Q3. Within this, the availability of credit provided to small businesses was reported to have increased in Q3, and was unchanged for medium and large businesses. The overall availability of credit to the corporate sector was expected to decrease slightly in Q4.

EUR/USD

Resistance levels (open interest**, contracts)

$1.1668 (965)

$1.1650 (418)

$1.1623 (93)

Price at time of writing this review: $1.1542

Support levels (open interest**, contracts):

$1.1495 (4501)

$1.1468 (3167)

$1.1437 (3063)

Comments:

- Overall open interest on the CALL options and PUT options with the expiration date November, 19 is 77838 contracts (according to data from October, 10) with the maximum number of contracts with strike price $1,1600 (4501);

GBP/USD

Resistance levels (open interest**, contracts)

$1.3325 (1024)

$1.3298 (802)

$1.3260 (621)

Price at time of writing this review: $1.3206

Support levels (open interest**, contracts):

$1.3168 (528)

$1.3104 (326)

$1.3076 (606)

Comments:

- Overall open interest on the CALL options with the expiration date November, 19 is 20127 contracts, with the maximum number of contracts with strike price $1,3200 (2319);

- Overall open interest on the PUT options with the expiration date November, 19 is 24578 contracts, with the maximum number of contracts with strike price $1,3000 (2250);

- The ratio of PUT/CALL was 1.22 versus 1.20 from the previous trading day according to data from October, 10

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.

In September 2018, the Consumer Prices Index (CPI) fell back by 0.2% over a month, after a 0.5% rebound in August. This downturn resulted from that, seasonal, in services prices (−1.5% after +0.3%). Contrariwise, manufactured product prices gathered pace (+1.3% after +1.1%) after the end of summer sales in August in the metropolitan area. Food prices were also more dynamic than in the previous month (+0.6% after +0.3%). Finally, energy prices rose by 0.9% over a month after a stability in August.

• Possible slowdown in the future

• Potential growth surprises normalized interest rate cycle

• We have reached a point where the stakes are in good standing

• I think that it is not necessary to do much more to normalize the Fed policy