JASPER’S MARKET SQUAWK 08-11-2023

<h2>And the Rally Keeps on Going</h2>
<p>US stocks had their seventh consecutive day of gains, supported by upbeat tech earnings, while investors tried to digest Fed speak in the absence of major data releases. The 10-year rose slightly to 4.583% despite a solid auction in 3-year bonds but had slid to 4.57% through the session.</p>
<p><img decoding="async" fetchpriority="high" class="alignnone size-full wp-image-26883" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Template-Daily.png" alt="" width="1917" height="918" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Template-Daily.png 1917w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Template-Daily-300×144.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Template-Daily-1024×490.png 1024w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Template-Daily-768×368.png 768w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/11/Template-Daily-1536×736.png 1536w" sizes="(max-width: 1917px) 100vw, 1917px" /></p>
<p><strong>Chart: WTI</strong></p>
<h2>Key Factors for Today</h2>
<ul>
<li>Tech Earnings Boost US Stocks, Now at Seventh Consecutive Gain</li>
<li>Fed Speak and Upbeat Earnings Divide Bullish Sentiment</li>
<li>German Industrial Data Points to Risk of Recession</li>
<li>WTI Crude Oil Tumbles to 3-Month Low on Huge Build</li>
<li>BOJ’s Kuroda Signals Exit from Ultraloose Policy</li>
</ul>
<h2>Bulls Split Between Fed Speak and Upbeat Earnings</h2>
<p>Fed Bank of Minneapolis President Neel Kashkari said the FOMC has not yet won the fight against inflation and leaned towards more tightening if needed. Fed’s Christopher Waller and Michelle Bowman also highlighted Q3’s solid growth in comments on Tuesday, pointing to a rather hot economy. However, several hawkish policymakers indicated that the recent tightening of financial conditions may result in economic troubles ahead, with Chicago’s Fed Austan Goolsbee pointing to higher long yields. The dollar advanced against a basket of currencies despite risk flows continuing into stocks but found resistance at 105.50, exposing 105.80 next. Conversely, 105 is major support in case of a reversal.</p>
<h2>German Industrial Data Corroborate De Guindos Remarks</h2>
<p>German industrial production cratered to -1.4% in September versus the -0.1% expected, revealing a slump in new orders and increasing the risk of a recession. ECB’s vice president, Luis de Guindos, said that the entire eurozone will likely contract into recession or stagnate in Q4 at best, adding to the narrative. Meanwhile, Portuguese bonds slumped after the country’s PM Antonio Costa resigned over allegations of corruption. The euro came under pressure on Tuesday, partially impacted by a higher dollar, but managed to defend the $1.07 line, opening up $1.0729. Losing the low at $1.0645 may see prices drop further.</p>
<h2>WTI Tumbles 4.80% to a 3-Month Low Following API Report</h2>
<p>Crude oil plunged to a 3-month low after API data displayed a big stock build in the aftermath of weak Chinese demand, easing fears about tight markets. Inventories rose by 11.9M barrels last week, being the catalyst to downward pressure in oil. The EIA said it expected total petroleum consumption to now drop by 300K bpd instead of rising 100K this year, switching its forecast. The next level of support can be seen at around $74.65 a barrel and under there at $72.60/bbl. This leaves resistance below the $80/bbl handle just at $79/bbl.</p>
<h2>BOJ’s Kuroda Reveals Prerequisites for Ultraloose Policy Exit</h2>
<p>BOJ’s Haruhiko Kuroda said that the bank is determined to keep policy unchanged until domestic demand and higher wages drive cost-push inflation but noted that real wages don’t have to be positive to end ultraloose monetary policy. He pointed to rising wages and inflation needing to increase with declining import prices for the BOJ to consider an exit. Meanwhile, Japan’s Tankan survey rose for the first time since August, data showed early Wednesday, but neither has resulted in the yen rising. USDJPY was up 0.23% yesterday, above 150 for the second session in a row, with prices currently revolving under the daily high of 150.70.</p>
<h2>On The Docket</h2>
<ul>
<li>DE Inflation rate</li>
<li>EA Retail Sales</li>
<li>Fed Cook Speech</li>
<li>Fed Chair Powell Speech</li>
<li>BOC Summary of Deliberations</li>
<li>Fed Williams Speech</li>
<li>Fed Barr Speech</li>
<li>Fed Jefferson Speech</li>
</ul>
<h2>FX 1-Day Relative Performance (USD)</h2>
<ul>
<li>Aussie and Kiwi 0.08% and 0.03% down</li>
<li>Euro down 0.13%, Pound lower at -0.20%</li>
<li>Loonie 0.09% lower, Franc 0.10% in red</li>
<li>Japanese yen at negative 0.21%</li>
<li>Gold 0.09% down, Silver at minus 0.22%</li>
<li>Crude down by 0.52%, Brent 0.28% in red</li>
<li>Natural gas 0.67% in the green zone</li>
</ul>
<p>The post <a href="https://www.keytomarkets.com/blog/analysis/jaspers-market-squawk-08-11-2023-2-26879/">JASPER’S MARKET SQUAWK 08-11-2023</a> appeared first on <a href="https://www.keytomarkets.com/blog">Key To Markets Blog</a>.</p>