Archives of “November 12, 2020” day

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The ECB Forum is over. What did the markets do?

  
  Analysis

The before and after from the ECB Forum

Before snapshot:
  • Gold, +$13.16 or 0.17% at $1878.89
  • S&P index -16.84 points or -0.47% at 3555.82
  • NASDAQ index -18.92 points or -0.16% at 11767.50
  • Dow industrial average -150.69 points or -0.51% at 29246
  • 10 year yield 0.902%, -7.2 basis points
  • 30 year 1.673%, -6.8 basis points
  • EURUSD 1.1814
  • GBPUSD 1.3149
  • USDJPY 105.13
  • USDCHF 0.9138
  • USDCAD 1.3105
  • AUDUSD 0.7266
  • NZDUSD 0.6875
After snapshot
  • Gold, plus $13.56 or 0.73% at $1879.29. Up $0.40
  • S&P index -39.73 points or -1.11% at 3532.93. Down -23 points
  • NASDAQ index -78.868 points or -0.67% at 11707.56. Down -60 points
  • Dow industrial average -341.01 points or -1.16% at 29056.62. Down -191 points
  • 10 year yield  0.896%, -7.9 basis points. Down 0.7 bps
  • 30 year bond yield 1.667%, -7.4 basis points. Down -0.6 bps
  • EURUSD 1.1803, down 11 pips
  • GBPUSD 1.3120, down 29 pips
  • USDJPY 105.21, up 8 pips
  • USDCHF 0.9152. up 14 pips
  • USDCAD 1.3135, up 20 pips
  • AUDUSD 0.7243, down -23 pips
  • NZDUSD 0.6854, down 21 pips

European shares break 3-day win streak

  
Analysis, Global Indices

Major indices lower on the day as concerned about Covid increase

The European stock markets are closed and have snapped the 3 day win streak seen this week. Last week most of the major indices rose 4 of the 5 days. So today is a tilt in the other direction.

The provisional closes are showing:
  • German DAX, -1.1%
  • France’s CAC, -1.3%
  • UK’s FTSE 100, -0.5%
  • Spain’s Ibex, -0.8%
  • Italy’s FTSE MIB, -0.7%
In other markets as London/European traders look to head for the exits:
  • spot gold is trading up $12.80 or 0.69% $1878.52.
  • Spot silver is trading up $0.05 or 0.24% at $24.33.
  • WTI crude oil futures are up $0.38 or 0.92% of $41.82

France PM Castex: One person is being admitted to hospital every 30 seconds with Covid

  
Analysis, COVID-19

France Prime Minister Castex speaking

  • one out of four Destin France’s due to Covid at present
  • one person is being admitted to hospital every 30 seconds at present in France because of Covid.
  • We can do more in terms of making people work from home
  • Covid 19 hospitalizations are now higher than April peak
  • evolution of new confirmed Covid cases has slowed it down a bit over the last week
  • This is a positive development regarding Covid 19 in France but must remain prudent

The race is on between the potential for a run away pandemic, hospital capacity limitations, PPE, and a vaccine.

Germany RKI chief warns that coronavirus deaths will rise across the country

  
Analysis, COVID-19

Remarks by Germany RKI chief, Lothar Wieler

  • Expects uncontrolled spread of infections in some parts of Germany
  • Number of infections are rising practically in all parts of the country
  • Still possible to flatten the curve by following distancing rules
The daily reports have already reflected such a trend as his headline remark, with the 261 deaths reported yesterday being the highest since April.
Healthcare capacity is also facing some pressure with coronavirus patients requiring intensive care having exceeded 3,000 this week – pretty much doubling every two weeks at the current pace. And that isn’t a good sign in trying to reduce the mortality rate.

IEA sees no major oil demand boost from vaccine breakthrough in 1H 2021

  
Analysis, Crude

IEA cuts its forecasts for global oil demand amid new lockdown measures

Oil
The agency cautions that a vaccine breakthrough won’t quickly revive markets and fuel use won’t experience any “significant” boost from vaccines until 2H 2021 at least.
In its latest report on the oil market, the agency is also cutting its oil-demand projections for Q4 2020 by 1.2 mil bpd and says that unless the fundamentals change, the task of re-balancing will make slow progress.
Adding that if OPEC+ producers proceed with a scheduled increase of almost 2 mil bpd in January, then there will be a failure to deplete global oil inventories in Q1 2021.

 

The agency also notes that available data for Q3 now suggests that inventories only fell by barely a third of the expected amount, down by about 800k bpd.

Nikkei 225 closes higher by 0.68% at 25,520.88

  
Analysis, Global Indices

No stopping the run in the Nikkei so far

Nikkei 12-11
They say that the trend is your friend and the Nikkei is proving that to be the case as Japanese stocks continue to climb upon a break to its highest levels since 1991 this week.
However, that belies the mood elsewhere with AxJ equities showing signs of exhaustion as the Hang Seng is down 0.3% while the Shanghai Composite is down 0.2%.
Meanwhile, US futures are also seen lower with S&P 500 futures down 0.5% with Nasdaq futures seen a little lower by 0.2% as we look towards European trading.
The market feels like it is still trying to figure out whether we are in need for a deeper correction after the manic start to the week or if this is all just a short breather. But either way, there is some element of push and pull taking place for now.

Germany reports 21,866 new coronavirus cases in latest update today

  
Analysis, COVID-19

The second-highest daily count on record for Germany

Germany
This shows that the virus situation isn’t quite abating just yet, but the figure it at least not growing exponentially as it has been doing in October.
There are now roughly ~240,000 active cases across the country.

 

The number of deaths is keeping on the high side as well, with another 215 deaths reported – following the 261 deaths yesterday, which was the highest since April – and that brings the total tally on that front to 11,982 persons.
It looks like it will still take some time before the virus trajectory turns the corner, and the hope for German officials is that it will be some time in the next week or two at least.

Financial conditions in China are tightening (albeit slowly)

  
  Analysis

There have been signs from the People’s Bank of China they are seeking to scale back on their stimulus policies.

Indeed, some officials from the PBOC have been bluntly saying as much, this from the weekend (I posted on it Monday) – vice governor of the  People’s Bank of China Liu Guoqiang:
  • exit from loose monetary policy is a ‘matter of time’
  • Policy makers globally are discussing the timing of stimulus withdrawal, and the consensus is that it should be done sooner rather than later
  • “Exit is a matter of time and it is also necessary,” he said. “But the timing and method of exit need to be carefully evaluated, mainly based on the status of economic recovery.”
Today:
  • overnight repo rate climbed to 2.53%, highest since mid-January
  • 7-day rate rose for a sixth session
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