As NA traders arrive for the day, the NZD is the strongest and the CHF is the weakest.
The strongest to weakest of the major currencies
The NZD is the strongest currency as the North American session begins, while the CHF is the weakest. The movement of capital is more “risk on” today, as markets saw a reversal of the flow yesterday, which saw stocks fall, yields fall, and crude oil fall – all on the basis of omicron fears.
Today, equities are higher, yields are higher, and crude oil is higher (European energy prices are rising with continued tension between Russia and Ukraine leading to slow supply). As the flight to the safety of the greenback diminishes, the USD is largely lower (albeit it is higher versus the JPY and CHF).
Following Manchin’s “thumbs down” over the weekend, the Democrats are trying to postpone further discussions on Biden’s Build Back Better plan until after the new year. Manchin and Biden were alleged to have spoken after the “no” vote, with Manchin remaining concerned about accounting gimmicks that do not count spending intentions for the entire planned period (10 years).
President Biden will address the nation today and explain plans addressing omicron risks, including free testing and the distribution of 500M tests to homes beginning next month. The omicron form now accounts for 70% of new Covid cases in the United States.
- Spot gold is trading up 6.34% at $1796.42
- Spot silver is trading up $0.43 or 1.97% at $22.69
- WTI crude oil futures are trading up $0.90 at $69.53
- The price of bitcoin has rebounded to $49,100. It traded as low as $45,570 yesterday.
In the premarket for US stocks, the major indices have rebounded from declines yesterday. The major indices have been down five the last six trading days:
- Dow industrial average is trading up 300 points after yesterday’s -433.28 point decline
- S&P index is trading up 43 points after yesterday’s 152.64 point decline
- NASDAQ index is up 181 points after yesterday’s -188.74 point decline.
In the European equity markets, the major indices have also rebounded:
- German DAX, +1.2%
- France’s CAC, +1.1%
- UK’s FTSE 100 +1.0%
- Spain’s Ibex, +1.3%
- Italy’s FTSE MIB +1.2%
In Europe, the benchmark 10 year yields are hall higher with UK yields up the most by 5.5 basis points. France yields are also back above 0.0% at 0.027%.
On the calendar today, Canada retail sales (+1.0% estimate) will be released at the bottom of the hour along with Canada new housing price index (+1.4% month on month). The US current account for the third quarter is expected to come in at $-205 billion versus $-190.3 million in the second quarter.