News & Analysis
Stocks recover; Forex mixed – USD steady – EUR Lower – AUDJPY snaps 5 days of loses.
Today’s high impact news:
▸ 19:30 EUR ECB President Draghi Speaks
▸ 00:30 CAD CPI
▸ 00:30 USD Building Permits
U.S. equities rose on Thursday, rebounding from consecutive declines, following strong quarterly results from Wal-Mart and Cisco Systems. Wall Street also cheered a key vote on tax reform. Strong gains were seen across the major indices. The Dow jumped by 187.08, the S&P500 added 21.02. The NASDAQ surged adding 87.08. In yesterday’s report, we did write about the US30 finding support at a previous low. Wal-Mart reported better-than-expected quarterly results, boosted by a surge in grocery and online sales. The House passed a bill Thursday aimed at overhauling the U.S. tax code. If the bill becomes law, it would immediately slash the corporate tax rate to 20 percent from 35 percent. However, the House bill contains key differences from that of the Senate, especially on how to treat state and local tax deductions. Expectations of tax reform have helped stocks reach all-time highs recently.
In Europe, share markets recovered. The FTSE added 14.33 the DAX closed 70.85 higher. Construction and materials were the top performing sector Thursday, on the back of earnings.
FX was a touch dull overnight as most majors made small moves. Data wise retail sales numbers in the U.K. came in higher-than-expected, showing an increase of 0.3 percent month-on-month in October. US unemployment claims unexpectedly rose to 249K. The USD increased 0.12 percent rebounding from a more than three-week low in the previous session, after the U.S. House of Representatives passed their version of the overhauled tax bill. Retail sales data support the GBP it finished higher to the USD and JPY. The EUR pulled back to the USD and finished flat to the JPY. Our local AUD finishing mixed for the day, flat to the USD and higher to the JPY. The AUDJPY ended a five-day losing streak closing 14 pips higher. Australian employment data did the lift the AUD during yesterday’s Asian session but it failed to hold gains with a strengthening USD.
AUDJPY – after five days in the red bulls finally pull one back helped by yesterday’s employment data. 85.45 remains a key level of defense for buyers. With a supply zone above the current picture doesn’t look that overly bullish.
Good trading from Eightcap.
Sources; Reuters, CNBC
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