Round up of today's market news *

North American News

US Indices Climb as Election Day Looms: Trump Media Drops After Hours

Major US indices ended the day near their highs, buoyed by anticipation ahead of Election Day. The Dow Industrial Average rose by 427.28 points, or 1.02%, to close at 42,221.88. The S&P 500 gained 70.07 points, or 1.23%, closing at 5,782.76. The Nasdaq added 259.19 points, or 1.43%, to finish at 18,439.17. The Russell 2000, a barometer of small-cap stocks, jumped 41.81 points, or 1.88%, to 2,260.84. With voters heading to the polls, the market sentiment reflects optimism despite the uncertainty surrounding the electoral outcome. Notably, shares of Trump Media saw a decline of 1.16% to close at $32.83, down 3.0% in after-hours trading. The stock had reached a high of $40.74 earlier in the day. Analysts continue to speculate whether the market will open higher or lower tomorrow based on election results.

Earnings Reports: Supermicro & Lumen Technologies

Supermicro (SMCI) provided a preliminary financial update for Q1 FY2025, projecting net sales between $5.9B and $6.0B, which falls short of previous guidance. Despite the sales miss, EPS is expected to exceed previous projections, signaling strong profitability management. The company also reported that its Special Committee investigation found no evidence of fraud or misconduct, although they recommended several governance improvements. Supermicro’s Q2 guidance shows a stable outlook with net sales expected between $5.5B and $6.1B.

Lumen Technologies (LUMN) posted Q3 2024 results, showing a 12% year-over-year decline in revenue and a net loss of $148M. Despite these challenges, Lumen’s focus on quantum fiber and AI-aligned infrastructure contributed to significant free cash flow and growth potential in digital services. However, continued declines in legacy segments may weigh on short-term performance. The company raised its free cash flow guidance for the full year, but concerns remain over segment-specific revenue declines.

Upcoming Earnings to Watch Tomorrow (Pre-Market)

Several notable companies will report earnings before the market opens tomorrow:

Celsius Holdings (CELH): Earnings Estimate: $0.95, Revenue Estimate: $269.63M
Novo Nordisk (NVO): Earnings Estimate: $0.90, Revenue Estimate: $10.68B
CVS Health (CVS): Earnings Estimate: $1.23, Revenue Estimate: $92.87B
Howmet Aerospace (HWM): Earnings Estimate: $0.45, Revenue Estimate: $1.85B
Aurora Cannabis (ACB): Earnings Estimate: -$0.22, Revenue Estimate: $53.11M

Market participants will closely monitor these earnings reports for insights into sector performance and potential market movements.

US treasury auctions off $42B of 10-year notes at a high yield of 4.347%

Results of the $42 billion auction of 10-year notes

bid-to-cover ratio 2.58
high yield 4.347% vs 4.350% pre-sale wi vs 6 auction average yield 4.145%
sells $42 bln
awards 47.22% of bids at high
primary dealers take 14.72%
direct 23.62%
indirect 61.66%

The Atlanta Fed GDPNow growth estimate 2.4% vs 2.3% last

It is still early in the 4Q but good growth after 2.8% in Q3

The Atlanta Fed GDPNow growth estimate for Q4 came in marginally higher at 2.4% vs 2.3% last. In their own words:

he GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2024 is 2.4 percent on November 5, up from 2.3 percent on November 1. After recent releases from the US Census Bureau, the Institute for Supply Management, and the US Bureau of Economic Analysis, the nowcast of fourth-quarter real personal consumption expenditures growth increased from 2.6 percent to 2.7 percent.

US October ISM services PMI @ 56.0

US October 2024 ISM services

Best since Sept 2023
Prior was 54.9
Business activity index 57.2 vs 59.9 prior
Employment 53.0 vs 48.1 prior
New orders 57.4 vs 59.4 prior
Prices paid 58.1 vs 59.4 prior
Supplier deliveries 56.4 vs 52.1 prior
Inventories 57.2 vs 58.1 prior
Backlog of orders 47.7 vs 48.3 prior
New export orders 51.7 vs 56.7 prior
Imports 50.2 vs 52.7 prior
Inventory sentiment 53.0 vs 54.0 prior

Comments in the report:

“Material availability and delivery continues to improve. The port strike had an impact, as we had to divert shipments, but the overall costs are not material. Services cost remains elevated but easier to negotiate.” [Accommodation & Food Services]
“Monitoring inventories much closer than in the past. We’re refilling inventories for the fall and winter seasons are lower level than normal, but those decisions are easy to understand.” [Agriculture, Forestry, Fishing & Hunting]
“Business is good. Building backlog. Commercial Construction is strong. Commercial Service is busy. All other areas are level.” [Construction]
“Hurricane Helene seriously damaged an IV production plant in North Carolina, which was 60 percent of all national supply of IV bag fluid/solution. We are now starting to experience shortages. In addition, two hurricanes hit Florida, which impacted many of our lab vendors. Plus, the port workers’ strike impacts shipments of materials that our (U.S.) labs use to manufacture medicine and medical supplies. We anticipate a rise in prices and longer wait times, and most likely, shortages of some supplies.” [Health Care & Social Assistance]
“Sadly, the recent hurricanes/tornadoes, and any future climate-related catastrophes, are good for the equipment sales and rental businesses. That and the continued infrastructure spending.” [Information]
“Revenue cycles are lengthening. Good sales, but longer service periods. Commodity pricing is stabilizing as inflation concerns ease. Business is in a steady state, with everyone holding an even keel awaiting U.S. election results.” [Professional, Scientific & Technical Services]
“Hurricane impacts have affected supplier deliveries.” [Real Estate, Rental & Leasing]
“Port strikes did not impact our supply chain, but we confirmed all our strategic vendors had plans in place should they have an impact.” [Retail Trade]
“Business is booming, nothing slowing down. Prices continue to increase slightly.” [Utilities]
“The economy is still causing issues within our business and that of our suppliers.” [Wholesale Trade]

US S&P Global October final services PMI 55.0 vs 55.3 prelim

The final look at the October PMI from S&P Global for services

Prelim was 54.3
Prior was 55.2
Composite index 54.1 vs 54.3 prelim (54.0 prior)
Employment falls for third straight month but only marginally
Output price inflation cools to joint-lowest in 4.5 years
New export orders growth slows to 4-month low
Business confidence rebounds to highest since June

Chris Williamson, Chief Business Economist at S&P Global Market Intelligence :

“The US service sector notched up another strong performance in October, helping offset the current weakness of the manufacturing sector to drive a solid pace of overall economic growth again at the start of the fourth quarter.

“The services economy’s consistently impressive growth in recent months has helped the US outperform all other major developed economies. October’s strong performance is consistent with GDP continuing to rise at an annualized rate in excess of 2%.

“Particularly welcome news comes from the cooling inflation picture. Average prices charged for services rose at a sharply reduced rate in October, showing one of the smallest increases seen for over four years, as competition intensified in the services economy.

“Firms’ expectations for the coming year have meanwhile perked up from a slump in September, though much uncertainty persists in relation to the business climate after the election, causing many firms to pause hiring until the political landscape becomes more settled.”

US September trade balance -84.4 billion vs -84.1 billion

The September US trade balance report

Prior was -70.4 billion
Goods trade -108.7 billion vs -108.2 billion prelim
Exports -1.2%
Imports +3.0%

The deficit jumped to the highest since 2022 because of a rush to import items ahead of a feared port strike.

Key Details:

Exports fell on declining civilian aircraft shipments (-$1.7B)
Pharmaceutical prep exports dropped $2.0B
Crude oil exports declined $1.3B
Consumer goods imports jumped $4.0B
Capital goods imports rose $2.8B led by computers (+$1.0B) and semiconductors (+$0.8B)
Auto imports increased $1.2B with passenger cars up $0.9B

BlackRock says traders are still pricing Federal Reserve rate cuts too aggressively

BlackRock cite: strong economy, sticky inflation, profligate politicians

Market pricing is still showing over 100bp of Federal Open Market Committee (FOMC) rate cuts through to the end of 2025.

BlackRock says this is too much, citing:
1. A solid economy

“U.S. Q3 GDP data last week showed consumer spending is still driving overall economic growth. Average monthly job creation over the past three months now stands at 104,000 after last week’s jobs report — still a healthy pace and one likely to pick up given hiring stalled due to hurricane-related disruptions.”

2. Stubborn inflation

3. Profligate politicians on both sides:

As the U.S. election occurs, neither presidential candidate is focused on budget deficits that are likely to stay large no matter who wins

BOC Meeting minutes: BOC felt upside pressure on inflation will continue to decline

The highlights of the BOC Meeting minutes for October 2024 where the central bank cut rates by 50 bps to 3.75% from 4.25%

Ahead of Bank of Canada’s October 23 rate announcement, governing council felt upside pressures on inflation will continue to decline, so policy did not need to be as restrictive.
Governing council members considered the merits of cutting the policy rate by 25 basis points. There was strong consensus for taking a larger step.
Members wanted to convey that a larger step was appropriate given the economic data seen since July.
Members discussed how slowing rate of population growth would act as a brake on total consumption growth.
Members noted it would take time for lower interest rates to have a big enough impact on per capita spending to overcome the drag on total consumption growth due to lower population growth.
Some members noted that with a soft outlook for demand, domestically oriented companies were reporting modest investment plans.
Governing council felt that if growth did not rise above potential growth, excess supply could persist in pulling inflation lower.
Members discussed the risk that lower interest rates, pent-up demand, and new rules for mortgage qualification could increase demand for housing and boost housing prices more than expected.
Members saw the prospect for stronger energy exports persisting through next year.
Members noted that geopolitical risks and risk of impacts from new shocks were more prominent than normal to the bank’s outlook.
Governing council agreed to continue its policy of normalizing the balance sheet by allowing maturing bonds to roll off.

Canada September trade balance -1.26 billion vs -0.80 billion

Canada September 2024 trade balance data

Prior was -1.1 billion
Exports $63.88 billion vs $64.31 billion prior
Imports $65.15 billion vs $65.41 billion prior

Trade deficit narrows to -$1.3B from -$1.5B prior
Trade surplus with US widens to $8.3B from $7.8B
Exports to US rose 1.6%, imports up 0.8%
Energy exports -2.6% on lower crude oil prices
Aircraft exports jumped 10.3% on higher US private jet shipments
Metal/mineral exports -5.4% on lower gold transfers
Real exports +1.4%, showing volume gains despite nominal decline

Commodities

Gold Treads Cautiously on U.S. Election Day

Gold prices held steady on Tuesday, navigating a complex landscape as the U.S. presidential election looms large, having reached a five-day low earlier in the session. The election presents a pivotal moment that could either polarize the U.S. dollar or create a “win-win” scenario for gold.

Market Dynamics

Gold found support at $2,724 early on Tuesday, bouncing back to the $2,730s, influenced by a marginally weaker U.S. dollar amid election uncertainties. As gold is predominantly priced in dollars, a weaker currency typically boosts its appeal.

The market sentiment is increasingly leaning towards the notion that the election results could lead to divergent outcomes for the dollar, with a Trump victory potentially strengthening the currency, while a Harris win could weaken it.

Geopolitical Factors and Technical Trends

Ongoing tensions in the Middle East also support gold prices, following threatening remarks from Iran’s Supreme Leader regarding responses to recent conflicts. Additionally, hedge funds maintaining long positions in gold provide further stability to the metal’s current pricing.

Matthew Jones, a precious metals analyst at Solomon Global, notes that regardless of who wins, the election is likely to incite volatility in financial markets, often serving as a catalyst for higher gold prices. According to 538.com, polling indicates a nearly even split between candidates, with Harris holding a slight lead.

Analyst Insights

Jones expresses a bullish outlook for gold, suggesting that a Trump presidency would heighten inflationary pressures and geopolitical tensions, reinforcing gold’s status as a safe-haven asset. Conversely, a Harris victory could trigger increased government spending on social and climate initiatives, exacerbating budget deficits and potentially weakening the dollar, thereby elevating gold’s attractiveness as a hedge against inflation.

Technical Analysis

From a technical standpoint, gold may be signaling a reversal in its short-term uptrend. The establishment of a series of declining peaks and troughs on the 4-hour chart suggests the potential for a short-term downtrend. A drop below the day’s low of $2,724 would confirm this downtrend, with prices possibly retreating to the lower range at $2,709.

The relative strength index (RSI) also indicates underlying selling pressure, showing bearish divergence compared to levels from October 23. However, given the medium and long-term bullish outlook, a recovery remains plausible. If gold manages to break above its all-time high of $2,790, it could quickly target resistance at $2,800 and beyond to $2,850.

Conclusion

As election results unfold, gold remains at a critical juncture, balancing between geopolitical tensions and domestic policy implications. Investors will be closely monitoring both the election outcome and market reactions, with potential price movements on the horizon as uncertainty gives way to clarity.

Private survey of oil inventories shows headline crude build much larger than expected

The inventory data from the private survey is out now, official data follows Thursday morning (US time).

API Inventory data
Crude +3.132 million (exp. +1.8 million)
Gasoline -928,000
Distillates -852,000
Cushing +1.724 million
SPR +1.4 million

Crude oil futures settle at $71.99

Up $0.52 or 0.73%

Crude oil futures are settling at $71.99, that is up $0.52 or 0.73%.

Some influences:

OPEC+ delayed 180,000 barrels per day of monthly production increases to January.
US election uncertainty: Vice-President Kamala Harris and former president Donald Trump are neck and neck.
China’s improving economy supports oil prices.

OPEC+ postpones planned production increase until the end of the year – Commerzbank

The OPEC Secretariat announced over the weekend that the voluntary production cuts of eight OPEC+ countries would be maintained in full until the end of the year. In addition, the countries have committed to strict implementation of the promised production cuts, including compensatory cuts to offset previous overproduction, Commerzbank’s commodity analyst Carsten Fritsch notes.

OPEC+ productions cut to be maintained

“It had already been hinted last week that the gradual increase in production planned for next month would be postponed again. Therefore, this was no longer a big surprise. An increase in supply in December would have risked triggering a decline in oil prices, even if the monthly production increase of 180,000 barrels per day had been small.”

“The signal alone and the prospect of further production increases in the following months would probably have been enough to put oil prices under pressure. The next regular OPEC+ meeting will take place on 1 December, when a decision is to be taken on oil production in the first half of 2025. Given weakening demand and rising oil supply outside OPEC+, there is no scope for OPEC+ to expand production without risking oversupply and a price decline.”

“Therefore, OPEC+ is unlikely to have much of a choice in a month’s time other than to postpone the production increase again. Yesterday, the OPEC Secretary General was very optimistic about oil demand. However, if the demand outlook is indeed so positive, there would have been no need to postpone the planned gradual withdrawal of the voluntary production cuts.”

Oil production in Iraq fell to the agreed level in October according to a survey – Commerzbank

According to a Reuters survey, oil production in Iraq fell to just under 4 million barrels per day in October, thus meeting the requirements of the OPEC+ agreement without taking the promised compensatory cuts into account.

Total OPEC oil production rises

“For the first time since the beginning of the year, the survey also showed that production in the nine countries bound by quotas (OPEC-9) was at the agreed level. Total OPEC oil production, by contrast, rose by 190,000 barrels per day because production in Libya normalised again after the outages in the previous two months.”

“The situation is similar in the Bloomberg survey. Here, too, total OPEC production rose, while production by the OPEC-9 fell. However, in this survey, Iraq’s production was still 120,000 barrels per day above the agreed level.”

EU News

European equity close: German stocks lead ahead of the US election

Closing changes for the main European bourses

Stoxx 600 flat
German DAX +0.5%
France CAC +0.5%
UK FTSE 100 -0.1%
Spain IBEX +0.2%
Italy’s FTSE MIB -0.2%

UK October final services PMI 52.0 vs 51.8 prelim

Latest data released by S&P Global – 5 November 2024

Prior 52.4
Composite PMI 51.8 vs 51.7 prelim
Prior 52.6

Services activity continues to see slowing momentum in October, with the weakest rise in business activity since November last year. Adding to that, employment conditions showed a fall for the first time this year. So, that is something that the BOE might want to take note of in terms of labour market developments moving forward. S&P Global notes that:

“October data signalled another slowdown in output growth across the service sector as heightened business uncertainty and concerns about the general UK economic outlook had an adverse impact on demand conditions.

“The latest expansion of service sector activity was the weakest since November 2023, while new business growth slipped to a four-month low. “The wait for clarity on government policy ahead of the Autumn Budget was widely reported to have weighed on business confidence and spending. Broader geopolitical concerns and forthcoming US elections also added to a sense of wait-and-see on business investment decisions in October. At the same time, cost of living pressures remained a constraint on household spending.

“With service providers grappling with softer new order growth and less upbeat business activity expectations for the year ahead, the latest survey pointed to a decline in staffing numbers for the first time since December 2023. A number of firms also noted budget constraints due to elevated salary pressures.

“Higher wages resulted in another month of strong input cost inflation across the service economy. The overall rate of inflation edged up to a three-month high, but remained much weaker than seen on average in the first half of 2024. Output charge inflation meanwhile held close to the 43-month low seen in September, with the latest reading consistent with a longer-term trend of decelerating price pressures across the service sector.”

UK – British Retail Consortium (BRC) total sales in October, weakest growth since July

Barclaycard data also

British Retail Consortium (BRC) total sales in October +0.6% y/y, weakest growth since July

prior (September) +2.0%
like-for-like sales +0.3% y/y (prior +1.7%)

Barclaycard UK October consumer spending +0.7% y/y, also the weakest growth since July

prior +1.2%
prior +2.0%

From the reports, in brief:

Factors like budget uncertainty, delayed purchases until Black Friday, and a later half-term break impacted sales.
The October 30 budget mostly targeted businesses for tax hikes, sparing many households from increased wage taxes, which may boost consumer confidence.
A 10% increase in the household energy price cap added pressure on consumers.
Essential spending dropped 2.2%, led by supermarkets, while non-essential spending rose 2.1%, driven by concert ticket sales.
Despite earlier concerns, easing inflation and improved confidence suggest potential for spending growth.

Switzerland October seasonally adjusted unemployment rate 2.6% vs 2.6% expected

Latest data released by SECO – 5 November 2024
Prior 2.6%

Asia-Pacific-World News

China Caixin Services October PMI @ 52.0

China PMI data

Caixin Services PMI for October comes in at 52.0

expected 50.5, prior 50.3

Composite 51.9

prior 50.3

This is the final of the China PMIs for October.

From the report, in brief on the services result today:

Business activity and new orders grew for the 22nd month, with overseas demand increasing for the 14th consecutive month.
Output prices remained stable as price hikes at some firms were balanced by discounts at others.
Future activity expectations rose nearly 3 points, reaching a five-month high, with businesses optimistic about near-term economic conditions.
Employment grew slightly as new orders prompted companies to increase staffing, marking two months in positive territory.
Work backlogs increased slightly for the third consecutive month.
Input costs rose, though at a slower pace, due to higher energy and raw material prices, while output prices remained stable.

And, on the Composite:

Composite PMI marking 12 consecutive months of expansion, with services outperforming manufacturing.
Manufacturing workforce contraction weighed on overall employment, despite growth in services.
Prices remained stable with a slight increase in service sector input costs.
Market optimism rebounded from September’s record low.
Following Politburo’s focus on economic challenges in late September, new policies aimed at stabilizing demand and improving optimism were introduced.
The labor market remains strained, and prices are low. Achieving 2024 growth goals will rely on a sustained rise in consumer demand, with a focus on boosting household income.

PBOC sets USD/ CNY reference rate for today at 7.1016 (vs. estimate at 7.1019)

PBOC CNY reference rate setting for the trading session ahead.

PBOC injects 18bn yuan via 7-day RR, sets rate at 1.5%

383bn yuan mature today
net drain is 365bn yuan

China’s Premier Li – government is capable of advancing strong economic growth

China’s Premier Li Qiang is addressing an Import Expo in Shanghai.

Must build a stronger consensus for opening up
China will upgrade free trade zones
China will explore free trade and investment agreements with other countries
China will continue to open telecommunications, internet, healthcare, and other sectors for investment
China stands ready to work with all sides to enhance coordination and collaboration
Many positive developments in China’s economy indicate a favourable outlook
China has both fiscal and monetary tools at its disposal
Confident of meeting this year’s growth target
Optimistic about economic prospects in the coming years
China can increase counter-cyclical adjustment

RBA governor Bullock: Current market pricing on cash rate is as good as any

Remarks by RBA governor, Michele Bullock

There are still upside risks to inflation
Too early to analyse any Trump scenario before the election is done
Government and central bank are not in disagreement on the economic outlook
We have the right policy settings at the moment
If economy turns down by more than expected, we will be ready to act
Labour market is softening but don’t see a massive sharp turnaround in underlying conditions
We are looking for evidence that inflation is heading back into the target band
It does not necessarily mean inflation needs to be back in the band before we start acting
Discussion today was similar to the September meeting
The conversation was more centered around “what we needed to see to change our mind” on policy
We have to make forecasts but they are inherently difficult
The further out you forecast, the bigger the error band
We use the market pricing as part of our cash rate forecast
The forecast and pricing of the current cash rate path is as good as any
But we are prepared to move if the data suggests to do so
Consumption remains a possible downside risk that could change our mind to act quicker
Productivity and wages are also another consideration
Overall risks are fairly balanced on inflation, policy
We can’t ignore risks from overseas developments but our main focus is on the domestic front

Reserve Bank of Australia leaves cash rate unchanged at 4.35%, as expected

Reserve Bank of Australia left its cash rate unchanged and didn’t signal any change in policy is imminent.

Headlines via Reuters:

The board will continue to rely upon the data and the evolving assessment of risks.
Underlying inflation remains too high.
Inflation is not expected to return sustainably to the midpoint of the target until 2026.
Policy will need to be sufficiently restrictive until the board is confident that inflation is moving sustainably towards the target range.
While headline inflation has declined substantially and will remain lower for a time, underlying inflation is more indicative of inflation momentum, and it remains too high.
The board is not ruling anything in or out.
Growth in output has been weak.
A range of indicators suggest that labour market conditions remain tight.
Taking account of recent data and the updated forecasts, the board’s assessment is that policy is currently restrictive and working broadly as anticipated.
Wage pressures have eased somewhat, but labour productivity is still only at 2016 levels, despite the pick-up over the past year.
demand still exceeds supply, although the gap is narrowing.
Core inflation remains elevated, with service inflation expected to decline only gradually.
The labour market remains tight, and demand for labour is strong.
Household consumption has picked up by less than expected and is likely to be flat in Q3.
Policy in Australia is not as restrictive as in most peers, even after recent rate cuts abroad.
The RBA has lowered forecasts for growth in GDP and household consumption and has trimmed CPI and core inflation projections.
The RBA sees CPI at 2.6% in December, 2.5% in June 2025, 3.7% in December 2025, and 2.5% in December 2026.
The RBA sees trimmed mean inflation at 3.4% in December, 3.0% in June 2025, 2.8% in December 2025, and 2.5% in December 2026.
The RBA projects GDP growth at 1.5% in December, 2.3% in December 2025, and 2.2% in December 2026.
The RBA sees unemployment at 4.3% in December, 4.5% in December 2025, and 4.5% in December 2026.
The RBA has revised up its employment growth forecast to 2.6% in December and 2.2% in June 2025, slowing to 1.3% by the end of 2026.
The RBA sees wage growth at 3.4% in December, 3.2% in December 2025, and 3.1% in December 2026.
It is difficult to sustain wage growth at the current level without a pick-up in productivity.
The RBA has trimmed population growth forecasts, reflecting tougher foreign student entry rules.
The outlook for China has been revised higher due to Beijing’s stimulus plans.

Australian October services PMI (final) 51.0 (September was 50.5)

Composite 50.2 (prior 49.6)

Judo Bank / S&P Global final services and composite PMIs for Australia in October 2024.

In summary from the report:

Services sector indicators were stronger than initial (“flash”) results, showing improved business conditions at October’s end.
Key activity indicators are in expansionary territory, with signs of strengthening economic activity heading into December.
Both business activity and employment rebounded since a July low, with new business activity reaching its highest level since interest rate hikes began in 2022.
Confidence rose in October, though it remains below past highs, indicating cautious optimism for 2025.
Business cost pressures eased, with input prices at a three-year low, suggesting possible lasting relief from inflation pressures.
While the final price index rose, it’s still lower than past years, supporting the view that inflation may be easing. Consistency in low levels will be key for inflation to return to target within 12–18 months.

Australia weekly consumer sentiment survey comes in at 86.5 (prior 86.4)

Barely changed on the week

ANZ-Roy Morgan Australian Consumer Confidence index, a weekly survey of persistent pessimists it seems.

Comes in at 86.5

prior 86.4

ANZ add:

Weekly inflation expectations were unchanged at 4.6%, but the 4wk moving average fell 0.1ppt to its lowest reading since Sep 2021.

New Zealand October commodity price index +1.4% m/m (prior +1.8%)

The October ANZ Commodity Price Index for New Zealand:

The index tracks the prices of 17 of New Zealand’s major commodity exports, including dairy products, meat, wool, forestry products, and seafood.

ANZ World Commodity Price Index, from the report:

+1.4% m/m in October

stronger prices were recorded for all major sectors excluding meat and fibre

In New Zealand dollar terms

+3.4% m/m as the NZD Trade Weighted Index fell by 1.3%

As part of this report ANZ remark on Global shipping prices

volatile Baltic Dry Index fell 32% during the month, to its lowest level in eight months
China Containerized Index, which measures the cost of shipping into and out of China, fell 16%
Global demand for ships tends to fall at this time of the year as we have now passed the seasonal peak in demand, and this influences price
From a New Zealand perspective export volumes are growing again as exports of products such as dairy lift, and demand for imports also increases as retail businesses stock up for Christmas

RBNZ says economic conditions remain challenging, business is doing it tough

Reserve Bank of New Zealand

economic conditions remain challenging, business is doing it tough
geopolitical tensions do really matter, key risk for the economy

RBNZ Governor Orr says economy is lagging rate cuts, which is a concern

The Reserve Bank of New Zealand is on record as regarding two years as a reasonable time for the transmission of monetary policy into the real economy.

Real economy is lagging reduction in interest rates, that’s a concern

Japan’s largest industrial union to target a standard 6% increase in total wages – report

Nikkei reports on the matter

UA Zensen is Japan’s largest industrial trade union and represents workers mostly at small and medium-sized firms. And once again – similar to earlier this year – they are calling for at least a standard 6% increase in total wages going into the spring wage negotiations in 2025. For some context, the wage hike asked for this year was the highest on record since 2013.

Tokyo Stock Exchange extended trading hours for 1st time in 70 years, starting today.

The parent company of the Tokyo Stock Exchange, Japan Exchange Group, confirmed it extended regular trading hours by 30 minutes.

beginning today
first extension of trading hours in 70 years
market will operate from 9 a.m. to 3:30 p.m. (with an hour long break for lunch)

South Korea’s October headline CPI is the lowest in more than 3.5 years

South Korea inflation data for October 2024

Headline CPI +1.3% y/y in October, weakest level since January 2021

expected 1.4%, prior 1.6%
for the m/m 0.0%

Core CPI +1.8%

down from 2.0% in September

Cryptocurrency News

Election Uncertainty: ETH Sees Selling Pressure as Investors Await Results

Ethereum price today: $2,450. As the U.S. presidential election unfolds, Ethereum’s market sentiment reflects investor caution, with a notable shift toward de-risking in anticipation of potential outcomes. Analysts suggest a 10% rally is possible should Donald Trump secure victory, allowing ETH to test the $2,707 resistance level.

Investor De-Risking Amid Rising Exchange Reserves

On-chain metrics indicate increased selling activity, with Ethereum’s exchange reserves climbing significantly since October 31. The reserve increased by over 220,000 ETH, valued at approximately $540 million, signaling heightened selling pressure among investors.

ETF Outflows Highlight Market Uncertainty

Recent data shows Ethereum exchange-traded funds (ETFs) experiencing substantial net outflows, totaling $63.2 million on Monday—marking the highest outflow since September 23. This includes:

Grayscale Ethereum Mini Trust (ETH): Outflows of $31.9 million, its first since launch.
Fidelity Ethereum Fund (FETH): $31.5 million, the highest outflow since its inception.
Grayscale Ethereum Trust (ETH): $10.8 million in outflows.

In contrast, BlackRock’s iShares Ethereum Trust (ETHA) saw positive momentum with a net inflow of $11 million.

Options Market Reflects Cautious Sentiment

ETH options data from Derive indicates that a significant portion of open interest (30%) is centered on the $2,800 calls, suggesting a tempered bullish outlook, expecting a modest upswing of 6.5% for ETH, while Bitcoin (BTC) anticipates a 12.5% rise. The 7-day and 30-day ETH skews hovering near zero further underscore a neutral market sentiment, as traders await regulatory clarity that could influence the decentralized finance (DeFi) landscape.

Political Influence on Market Dynamics

Given Trump’s advocacy for making America a “crypto nation,” many crypto investors lean towards a Republican win. In contrast, Kamala Harris’ ambiguous position on digital assets adds to the uncertainty, prompting a cautious de-risking approach among ETH investors ahead of the election results.

Technical Outlook

Should Ethereum overcome the $2,500 psychological resistance, a potential rise to $2,707 could be on the horizon, contingent on the election outcome and overall market sentiment. The current landscape suggests that investors are closely monitoring developments, with a cautious eye on how the election results may reshape the crypto market’s future trajectory.

Crypto Markets Poised for Turbulence as Trump and Harris Face Off

The upcoming U.S. presidential election is set to create ripples across crypto markets, influenced by the candidates’ differing approaches to digital assets. With a tight race between Donald Trump and Kamala Harris, traders brace for potential volatility stemming from political uncertainty and policy implications.

Trump’s Pro-Crypto Agenda

Donald Trump’s pro-crypto proposals resonate with the crypto community, leading to a perceived bias in his favor. His plans include establishing a national Bitcoin stockpile to bolster the U.S. position in cryptocurrency adoption, along with the formation of a Bitcoin and crypto presidential advisory council aimed at providing clearer regulatory guidelines.

Trump has also criticized the current SEC chair, Gary Gensler, indicating intentions to reshape the regulatory landscape. Notably, his family has entered the crypto sphere with the launch of World Liberty Financial (WLFI), further solidifying their commitment to the industry.

Harris’ Supportive Yet Cautious Stance

Conversely, Vice President Kamala Harris has expressed support for the crypto sector, although her statements are less detailed than Trump’s. Harris emphasizes the potential of blockchain technology and advocates for a regulatory framework that balances innovation with consumer protection. Her engagement with crypto leaders indicates a willingness to foster a more integrated approach to digital assets.

Market Sentiment and Historical Context

The crypto market’s sensitivity to political events is underscored by historical performance during previous elections. Following Trump’s 2016 victory, Bitcoin experienced a brief dip of 5.5% but quickly rebounded. In contrast, Biden’s 2020 win saw Bitcoin surge over 22% within 11 days, driven by broader economic factors such as interest rate cuts and COVID-19 stimulus measures.

Despite the limited data available, trends indicate that crypto markets tend to react strongly to the election outcomes, reflecting traders’ concerns about regulatory shifts and candidates’ policies.

Anticipating Market Movements

As the election unfolds, crypto traders are advised to remain vigilant. With the potential for significant price movements based on the election results, the crypto community is keenly aware that the incoming administration’s stance on digital assets will play a crucial role in shaping future market dynamics.

As perceptions of support or restrictions from the new administration become clearer, volatility in the cryptocurrency markets is almost inevitable. Investors will closely monitor the implications of the election outcome, making this a pivotal moment for the crypto industry.

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Round up of today’s market news

ByBilals Tech