Spreadex Market Analysis: Crude Falls, UK Markets Trading Up

AM Analysis – “WTI crude continues to fall for a fourth day” – Lee Mumford
Despite a negative European session yesterday, the NASDAQ composite index managed to close above 4000 for the first time since 2000. Homebuilders and Retailers helped push the index to a 13 year high after the sector responded to stronger-than-expected earnings and robust housing market data. FTSE futures are indicating a 10 point higher open.
 
The euro swung to fresh highs against the yen and the US dollar after a rise in short term market rates helped the currency. The euro interbank lending rates rose on Tuesday after the amount of extra money in the financial system fell to its lowest level in more than two years. Investors also tested the upside of the single currency ahead of this week’s US holiday.
 
Bank of Japan Board member, SayuriShirai said that Japan may not achieve the 2 percent consumer inflation target due to uncertainty over whether wages and inflation expectations will improve enough in a country caught up in deflation. Shirai stuck to the BOJ’s view that the Japanese economy is recovering but the outlook remained unwelcoming given the delay in pickup in exports and global growth.
 
WTI crude continues to fall for a fourth day after an industry report showed crude supplies rose for a ninth week. The American Petroleum Institute said yesterday than crude inventories climbed by 6.9 million barrels last week.
 
US unemployment claims will be announced today, a day early due to the Thanksgiving US holiday. Analysts are expecting a rise in claims from the previous week to 331,000.
 
PM Analysis – “UK markets traded up this morning after UK growth came in in-line with forecasts” – Alex Conroy
UK markets traded up this morning after UK growth came in in-line with forecasts; consumer spending continues to be the main driver behind growth, with the holiday period approaching this can be expected to continue. This comes as welcome news for George Osborne a week before he is due to deliver his half-year budget statement.
 
David Cameron today announced his plans to attempt to make it harder for migrants from the EU to claim benefits in Britain; new migrants would have to wait three months before they could claim benefits. This comes after public calls for tougher stances on immigration after a spate of Romanian immigrants exploiting the system. This is being tied into David Cameron’s plan to change the conditions for the UK’s membership in the EU, commenting that “The EU of today is very different from the EU of 30 years ago” and therefore memberships should reflect this.
 
US markets were buoyed this afternoon after better than forecast Unemployment claims data was released. Forecast at 331K the actual figures of 316K will likely add to the frenzy of speculation over when the Fed plans to start tapering and whether these unemployment figures signal that tapering is another step closer.
 
[The original articles by Spreadex can be found here.]
 
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