Markets pause after Wall Street rally - 31.10.2022

The Dollar strengthening continues currently. The live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, added 0.1% on Friday as US Bureau of Economic Analysis reported the personal consumption expenditures, a gauge of what households spend on goods and services, rose 0.6% in September, the same rate of growth as in August.

EUR/USD ended flat Friday while GBP/USD reversed its sliding after federal statistics office Destatis report German economy accelerated growth in third quarter while a decline in the gross domestic product was forecast. Both Pound and euro are lower against the Dollar currently. USD/JPY reversed its sliding Friday while AUD/USD continued its retreating with both the yen and Australian dollar lower against the Greenback currently.

Futures on US equity benchmarks are down currently after US stocks closed sharply higher on Friday as economic data showed US consumer spending, measured by personal consumption expenditures, and personal income rose in September despite inflation. The three main US stock benchmarks recorded daily gains ranging from 2.5% to 2.9%, led by tech shares.

European stock indexes futures are mixed currently after shares closed mixed on Friday with basic resources and retail sectors closing down 2% following a 75 basis points hike in interest rates by the European Central Bank the previous day. Asian indexes futures are falling today with Hong Kong’s Hang Seng leading losses as the Shanghai Composite index data showed China's private sector business activity contracted in September, as did manufacturing sector activity.

Brent is extending losses today. Prices fell Friday after top crude importer China ramped up COVID-19 curbs on Thursday, sealing up buildings and locking down districts in cities after registering 1,506 new COVID infections. West Texas Intermediate (WTI) futures fell 1.3% and is lower currently. Brent crude lost 1.2% to $95.77 a barrel on Friday. Wheat futures jumped more than 5% today as Russia withdrew from a Black Sea corridor agreement after what it said was a Ukrainian drone attack on vessels in the Bay of Sevastopol.