S&P 500 closes at new record

Always remember, your focus determines your reality.” - George Lucas

 

 

HEADLINES

 

 

• Dollar loses ground after U.S. inflation data
• Oil prices post biggest weekly gain since August
• Gold Inches Higher, Refusing to be Hurt by ‘Fear Salesman’
• S&P 500 rises to record close Friday despite inflation fears, posts best week since February
• Bitcoin rises 2.1% to reclaim $50,000
• Fed to double pace of tapering and to deliver a more hawkish statement – TD Securities

 

 

 

FOREX

 

 

 

Dollar loses ground after U.S. inflation data

 

The dollar lost some ground on Friday after U.S. consumer prices increased roughly in line with expectations in November as investors, who had been bracing for much higher inflation, bet that the actual number would not change the pace of interest rate hikes. Labor Department data showed an increasing consumer price index (CPI) as cost of goods and services rose broadly amid supply constraints for the largest annual gain since 1982.

 

 

 

COMMODITIES

 

 

Oil prices post biggest weekly gain since August

 

Oil prices rose slightly on Friday and posted their biggest weekly gain since late August, with market sentiment buoyed by easing concerns over the Omicron coronavirus variant's impact on global economic growth and fuel demand.

The Brent and U.S. West Texas Intermediate (WTI) crude benchmarks each posted gains of about 8% this week, their first weekly gain in seven, even after a brief bout of profit-taking.

 

Gold Inches Higher, Refusing to be Hurt by ‘Fear Salesman’

 

Futures of the yellow metal gained on Friday, even inched forward on the week, while fears of a faster-than-expected rate hike amplified in the United States after the November reading for the Consumer Price Index came in on level with October, which was already at 40-year highs.

News of rate hikes are almost always bad for gold. This time though, traders in bullion appeared focused on the inflation story, allowing to let slide talk of potential Federal Reserve action to right the situation.

 

 

STOCKS

 

 

S&P 500 rises to record close Friday despite inflation fears, posts best week since February

 

The S&P 500 closed at a record on Friday, capping off Wall Street’s strong rally this week, despite inflation hitting a 39-year high. The Dow Jones Industrial Average rose 4% since Monday, snapping a 4-week losing streak. The 30-stock index had its best weekly performance since March. The S&P 500 and Nasdaq Composite added 3.8% and 3.6%, respectively, this week — the best since February for both indexes.

 

 

CRYPTO

 

 

Bitcoin rises 2.1% to reclaim $50,000

 

Bitcoin rose on Sunday to reclaim levels above $50,000.

The world's biggest and best-known cryptocurrency gained 2.11% to $50,445.34 at 1803 GMT on Sunday, adding $1,044.80 to its previous close. Bitcoin is up 81.9% from the year's low of $27,734 on Jan. 4.

 

 

ANALYSIS

 

 

Fed to double pace of tapering and to deliver a more hawkish statement – TD Securities

 

“The taper pace will likely be doubled to $30bn per month, consistent with QE ending in March. Officials will likely also convey a more hawkish tone through the statement, the economic projections, and the dot plot. The median dot will probably show a 50bp increase in 2022. We expect enough slowing in inflation and growth to delay rate hikes until 2023, but, for now, strong data are encouraging hawkishness.”

“Scope for USD upside is capped given how much is priced in the front-end. As a practical matter however, a hawkish SEP, a faster taper and less threat from Omicron leave the USD in our good graces still.”

 

 

CHART

 

 

GBP/USD – 4-Hour Candlesticks

Source: GKFX Prime Metatrader 4

GBP/USD broke above a downtrend line after holding on at 1.32 support. The 20-day moving average could be the next resistance. - Prepared by Trading Writers*

 

 

CALENDAR

 

 

*Times in GMT

Source: FX Street Economic Calendar

 

 

SOURCE

 

 

 

https://www.fxstreet.com/economic-calendar
https://www.investing.com/news/forex-news/bitcoin-rises-21-to-reclaim-50000-2708778
https://www.investing.com/news/commodities-news/oil-prices-slip-on-profittaking-but-head-for-strong-weekly-gain-2706664
https://www.investing.com/news/commodities-news/gold-inches-higher-refusing-to-be-hurt-by-fear-salesman-2707830
https://www.cnbc.com/2021/12/09/stock-market-futures-open-to-close-news.html