European Equities: Service Sector PMIs and Brexit in Focus

Economic Calendar:

Thursday, 3rd December

Spanish Services PMI (Nov)

Italian Services PMI (Nov)

French Services PMI (Nov) Final

German Services PMI (Nov) Final

Eurozone Markit Composite PMI (Nov) Final

Eurozone Services PMI (Nov) Final

Eurozone Retail Sales (MoM) (Oct)

Friday, 4th December

German Factory Orders (MoM) (Oct)

IHS Markit Construction PMI (Nov)

The Majors

It was a mixed day for the European majors on Wednesday, following Monday’s gains. The DAX30 and EuroStoxx600 fell by 0.52% and by 0.05% respectively, while the CAC40 ended the day up by 0.02%.

For the majors, concerns over a lack of progress towards Brexit pegged the majors back on the day. Also weighing on the majors and the DAX30, in particular, was news that the Democrats would retain the phase 1 trade agreement with China near-term.

There were positives, however, that provided support. News of the UK approving the BioNTech/Pfizer.inc vaccine delivered support, as did Joe Biden talk of a COVID-19 stimulus package.

According to reports on Wednesday, the President-Elect stated that delivering a COVID-19 stimulus package was an immediate priority.

The Stats

It was a relatively busy day on the Eurozone economic calendar. German retail sales figures for October were in focus going into the European open.

According to Destatis, retail sales rose by 2.6% in October, reversing a 1.9% slide in September. Economists had forecast a 1.2% rise.

  • Compared with the same month a year ago, retail sales were up by 8.2%.
  • Supermarket, self-service department shops, and hypermarket sales were up by 7.9%, year-on-year.
  • In the non-food retail sector, sales rose by 9.0%.
  • When compared with February 2020, the pre-COVID-19 pandemic month, retail sales rose by 5.9%.

Unemployment numbers from Spain and the Eurozone released later in the day had a muted impact on the majors.

In Spain, the unemployment rose by 25.3k in September, following a 49.6k jump in August.

For the Eurozone, the unemployment rate slipped from an upwardly revised 8.5% to 8.4% in October. Economists had forecast an unemployment rate of 8.4%.

According to Eurostat,

  • While down from 8.5% in September, unemployment was up from 7.4% in October 2019.
  • Compared with September 2020, Eurostat estimates that the number of unemployed persons fell by 91,000.
  • By contrast, however, the number of unemployed persons increased by 2.186 million when compared with October 2019.

From the U.S

ADP non-farm employment change figures were in focus late in the day.

In November, nonfarm employment increased by 307k, falling short of a forecasted 410k increase. In October, nonfarm employment had increased by 365k.

The Market Movers

For the DAX: It was a mixed day for the auto sector on Wednesday. Continental slid by 1.56%, with BMW and Volkswagen falling by 0.39% and by 0.44% respectively. Daimler rose by 0.24%, however, to buck the trend on the day.

It was a bullish day for the banks. Deutsche Bank rose by 0.90%, with Commerzbank ending the day up by 1.81%.

From the CAC, it was a bullish day for the banks. BNP Paribas and Credit Agricole rose by 1.69% and by 1.67% respectively, with Soc Gen gaining 2.10%.

It was a mixed day for the French auto sector, however. Peugeot fell by 0.79%, while Renault rose by 1.45%.

Air France-KLM slipped by 0.85%, while Airbus SE rose by 2.15%, following Tuesday’s 1.90% gain.

On the VIX Index

It was a 2nd consecutive day in the green for the VIX, after having fallen for 5 consecutive days. Following on from Tuesday’s 0.97% gain, the VIX rose by 1.93% to end the day at 21.17.

Disappointing ADP nonfarm figures had limited impact, while plans to retain the phase 1 trade agreement with China was market negative. On the positive, however, remained progress towards a COVID-19 vaccine and hopes of a stimulus package to support the U.S economy.

For the U.S markets, it was a mixed day after Tuesday’s gains and last month’s rally. The Dow and S&P500 rose by 0.20% and by 0.18% respectively, while the NASDAQ slipped by 0.05%.

VIX 031220 Daily Chart

The Day Ahead

It’s a busy day ahead on the Eurozone economic calendar. Key stats include services and composite PMI numbers for Italy and Eurozone retail sales figures.

Finalized services and composite PMI figures for November are also due out for France, Germany, and the Eurozone.

We would expect the Eurozone’s composite and services PMI to have the greatest impact on the majors.

From the U.S, the all-important ISM services PMI and weekly jobless claims figures will also influence later in the day.

Away from the economic calendar, Brexit and COVID-19 news updates will need monitoring. Any further chatter on a stimulus package from Capitol Hill would influence.

The Futures

In the futures markets, at the time of writing, the Dow Mini was up by 18 points.

For a look at all of today’s economic events, check out our economic calendar.

COVID-19 Vaccine Update – The UK Wastes No Time as MHRA Approves Vaccine

The Latest

BioNTech and Pfizer Inc. became the first pharma to have their mRNA COVID-19 vaccine approved on Wednesday.

The UK’s Medical & Healthcare Products Regulatory Agency (“MHRA”) became the first agency to approve a COVID-19 vaccine.

With the UK suffering at the hands of the COVID-19 pandemic, the independent regulator wasted little time.

The UK Government has pre-ordered 145 million doses of COVID-19 vaccines from Pfizer Inc., Moderna Inc., and AstraZeneca. Of the 145 million doses, the government has pre-ordered 40 million from BioNTech/Pfizer Inc.

With an efficacy rate of 95% and effective across all age groups, the first doses of the vaccine are due to arrive in days.

The UK Government announced that a first batch of 800,000 doses forms part of an expected 10 million doses by the end of the year.

With the vaccine coming in 2 doses, 5 million patients will receive inoculation if BioNTech/Pfizer Inc. delivers the full quota.

The Government’s Joint Committee on Vaccination and Immunisation (“JCVI”) affirmed on Wednesday that the first priorities should be the prevention of COVID-19 mortality and the protection of health and social care staff and systems.

The JVIC has given older adult residents in care homes the highest priority for vaccination, followed by care home workers.

Secondary priorities could include vaccination of those at increased risk of hospitalization and at an increased risk of exposure.

Logistics will now need to be in place to transport the vaccine, at -70C, for administration across the UK.

How the Markets Reacted

The FTSE100 rose by 1.23% on Wednesday, with the upside coming off the back of the MHRA announcement.

For the European majors, while it was a mixed day, the DAX30 and CAC40 came off lows in response to the news.

BioNTech SE share price rose by 6.21% in response to the news. Pfizer Inc. ended the day up by a more modest 3.51%.

While trailing Pfizer Inc. in the race to deliver a global vaccine, there was also support for AstraZeneca and Moderna Inc., which rose by 1.26% and by 1.41% respectively.

What’s next?

With UK regulators beating the FDA and the EU’s European Medicines Agency (“EMA”) to the punch, BioNTech/Pfizer Inc. will now need to deliver the doses.

There’s no trial run for BioNTech/Pfizer Inc. in terms of delivering the doses in a timely manner.

Both BioNTech/Pfizer Inc. and the government will likely face logistical challenges and the markets and governments from overseas will likely watch closely.

Successful distribution and administration of the first batch are now key. For the FDA and the EMA, both will have the benefit of the UK government’s experiences in distribution and vaccination.

The FDA is set to review the BioNTech/Pfizer Inc. vaccine on 10th December. In the New Year, the EMA review is due on 12th January.

Key areas of focus in the coming weeks will be production and distribution and geographical allocation.

The EU has pre-ordered 300 million doses of the BioNTech/Pfizer Inc. vaccine, with the U.S pre-ordering 100 million and an option for an additional 500 million doses.

BioNTech/Pfizer Inc. has projected between 5 million to 50 million doses to be available by the end of the year.

The UK is due to receive 10 million doses, which leaves 40 million assuming that 50 million doses are produced.

With the EU review of the vaccine not due until mid-January, that leaves the U.S and Japan in focus. While the U.S has pre-ordered 100 million, Japan has pre-ordered 120 million of the BioNTech/Pfizer Inc. vaccine.

Pressure may mount on the likes of the EMA to bring forward vaccine reviews. BioNTech/Pfizer Inc. may also feel increased pressure to deliver on the higher side of production forecasts…

Correction on Gold and Oil Accelerates

Gold accelerates with a bullish reversal. One horizontal and one dynamic resistance are broken, time to test the 1850 USD/oz.

Brent and WTI go lower but still inside the flag.

Nasdaq continues the upswing.

DAX bounces from the lower line of the channel up.

SP500 bounces from the horizontal support.

Dollar Index collapses.

EURUSD aims significantly higher.

EURJPY surges after the Inverse Head and Shoulders pattern.

USDCAD goes deeper after breaking crucial long-term horizontal support.

For a look at all of today’s economic events, check out our economic calendar.

European Equities: Futures Point South with Economic Data and Brexit in Focus

Economic Calendar:

Wednesday, 2nd December

German Retail Sales (MoM) (Oct)

Spanish Unemployment Change

Eurozone Unemployment Rate (Oct)

Thursday, 3rd December

Spanish Services PMI (Nov)

Italian Services PMI (Nov)

French Services PMI (Nov) Final

German Services PMI (Nov) Final

Eurozone Markit Composite PMI (Nov) Final

Eurozone Services PMI (Nov) Final

Eurozone Retail Sales (MoM) (Oct)

Friday, 4th December

German Factory Orders (MoM) (Oct)

IHS Markit Construction PMI (Nov)

The Majors

It was a bullish start to the month for the European majors on Tuesday. Reversing losses from Monday, the CAC40 rallied by 1.14% to lead the way. The DAX30 and EuroStoxx600 saw more modest gains of 0.69% and 0.65% respectively.

Economic data from China and news of Moderna Inc. submitting a EUA to the FDA provided support to the majors on the day.

Disappointing economic data from the Eurozone and the U.S failed to sink the majors, with the markets expecting a COVID-19 vaccine fuelled economic recovery next year.

The Stats

It was a particularly busy day on the Eurozone economic calendar. November manufacturing PMI figures for Spain, Italy, and Germany unemployment data were in focus through the day.

Finalized manufacturing PMI numbers for France, Germany, and the Eurozone were also out on the day.

The PMIs

In November, Spain’s manufacturing PMI fell from a 3-month high of 52.5 to 49.8. Economists had forecast a fall to 50.5.

Italy’s Manufacturing PMI declined from a 31-month high of 53.8 to 51.5, which fell short of a forecasted 52.0.

The finalized French PMI came in at 49.6, which was up from a prelim 49.1, while down from October’s 51.3, with Germany’s PMI coming in at 57.8. This was down from a prelim 57.9 and from a 31-month high of 58.2 in October.

For the Eurozone, the November PMI came in at 53.8. This was up from a prelim 53.6, while down from October’s 54.8.

According to the Eurozone’s October Markit Survey,

  • Growth in new orders eased to a 5-month low, with new export orders rising at the slowest pace since August.
  • Backlogs increased for a 4th consecutive month, highlighting capacity pressures, while firms cut staffing levels for a 19th month-in-a-row.
  • On the pricing front, input cost inflation accelerated at the sharpest pace in almost 2-years, with output prices also on the rise.
  • Confidence improved to its highest for over two-and-a-half years, with Dutch, German, and Italian companies the most confident.

By Country,

  • With the exception of the Netherlands and Ireland, all countries recorded a weakening in their respective PMIs.
  • Germany remained the best-performing country, followed by the Netherlands and Ireland.
  • While Austria and Italy also reported solid growth, Spain and France reported minor contractions.
  • Greece remained by far the worst-performing.

German Unemployment

November unemployment figures from Germany impressed once more, falling by 39k. Economists had forecast an 8k rise. Following October’s 38k decline, the unemployment rate fell from 6.2% to 6.1% in November.

Eurozone Inflation

Eurozone inflation figures for November failed to impress, however. Consumer prices fell by 0.3%, year-on-year, and by 0.3% month-on-month. Core consumer prices rose by just 0.2%, year-on-year, according to prelim figures.

From the U.S

The market’s preferred ISM Manufacturing PMI fell from 59.3 to 57.5. Economists had forecast a decline to 58.0.

The Market Movers

For the DAX: It was a bullish day for the auto sector on Tuesday. Continental and Volkswagen rallied by 3.45% and by 3.76% respectively to lead the way. BMW and Daimler saw more modest gains of 2.40% and 1.24% respectively.

It was also a bullish day for the banks. Deutsche Bank reversed Monday’s 1.44% loss with a 1.42% gain, with Commerzbank rallying by 3.69%.

From the CAC, it was a bullish day for the banks. Credit Agricole and Soc Gen rallied by 5.49% and by 5.15%, with BNP Paribas rising by 2.89%.

It was also a bullish day for the French auto sector. Peugeot and Renault ended the day with gains of 1.90% and 2.64% respectively.

Air France-KLM resumed its upward trend, rallying by 3.4%, with Airbus SE ending the day up by 1.90%.

On the VIX Index

A run of 5 consecutive days in the red came to an end for the VIX on Tuesday. Partially reversing a 1.30% decline from Monday, the VIX rose by 0.97% to end the day at 20.77.

On Tuesday, the Dow rose by 0.63%, with the NASDAQ and the S&P500 ending the day with gains of 1.28% and 1.13% respectively.

The upside for the VIX came in spite of fresh record highs for the U.S majors, with downside risks lingering in spite of progress towards a COVID-19 vaccine.

VIX 021220 Daily Chart

The Day Ahead

It’s a relatively quiet day ahead on the Eurozone economic calendar. Unemployment figures from Spain and the Eurozone, and German retail sales figures are due out later this morning.

Barring dire numbers, however, the unemployment figures should have a muted impact on the European majors. Lockdown measures are likely to hurt employment conditions further in the near-term. The progress towards a COVID-19 vaccine has raised the hope of a recovery going into 2021.

Germany’s retail sales figures will influence early in the session, however.

From the U.S, November’s ADP non-farm employment change figures are due out that will draw some interest.

Away from the economic calendar, Brexit and COVID-19 news updates will need continued monitoring. Any progress towards a stimulus package on Capitol Hill would influence.

The Futures

In the futures markets, at the time of writing, the DAX was down by 70 points, with the Dow Mini down by 175 points.

For a look at all of today’s economic events, check out our economic calendar.

DAX Bulls are Controlling the Trend

DAX is extremely bullish. I expect uptrend continuation provided that the price is already rejecting 88.6 fibonacci level.

13264 is the 88.6. We can see how the price reacted and it’s a clear rejection off the 88.6. We can expect continuation up towards next levels. 13427, 13469 and 13495. Above 13495 we should see 13610. I don’t see any bears unless the market breaks below the D L3 camarilla pivot – 13211. Buying the dips is the scenario.

For a look at all of today’s economic events, check out our economic calendar.

 

European Equities: Economic Data and Brexit in Focus

Economic Calendar:

Tuesday, 1st December

Spanish Manufacturing PMI (Nov)

Italian Manufacturing PMI (Nov)

French Manufacturing PMI (Nov) Final

German Manufacturing PMI (Nov) Final

German Unemployment Change (Nov)

German Unemployment Rate (Nov)

Eurozone Manufacturing PMI (Nov) Final

Eurozone Core CPI (YoY) Prelim

Eurozone CPI (MoM) Prelim

Eurozone CPI (YoY) (Nov) Prelim

Wednesday, 2nd December

German Retail Sales (MoM) (Oct)

Spanish Unemployment Change

Eurozone Unemployment Rate (Oct)

Thursday, 3rd December

Spanish Services PMI (Nov)

Italian Services PMI (Nov)

French Services PMI (Nov) Final

German Services PMI (Nov) Final

Eurozone Markit Composite PMI (Nov) Final

Eurozone Services PMI (Nov) Final

Eurozone Retail Sales (MoM) (Oct)

Friday, 4th December

German Factory Orders (MoM) (Oct)

IHS Markit Construction PMI (Nov)

The Majors

It was a bearish end to the month and the start of the week for the European majors on Monday. Coming off the back of a bullish week, the DAX30 and EuroStoxx600 fell by 0.33% and by 0.98% respectively. The CAC40 slid by 1.42%, however, to lead the way down.

On the day, a lack of progress towards Brexit and some profit-taking following an impressive November rebound left the majors in the red.

Inflation figures from the Eurozone and stats from the U.S didn’t help, however, with the stats skewed to the negative.

The Stats

It was a relatively busy day on the Eurozone economic calendar. Prelim November inflation figures for Spain, Italy, and Germany were in focus on the day.

In Spain, consumer prices fell by 0.8% in November, compared with November 2019. In October, consumer prices had also fallen by 0.8%. The harmonized index of consumer prices fell by 0.9%, following a 0.9% decline in October. Economists had forecast a 0.8% decline, year-on-year.

Things were not much better from Italy, with consumer prices falling by 0.1% in November, month-on-month. In October, consumer prices had risen by 0.2%.

From Germany, deflationary pressures saw a marked pickup. Consumer prices slid by 0.8% in November, reversing a 0.1% rise from October. Economists had forecast a 0.7% decline.

From the U.S

Chicago PMI numbers for November and October pending home sales figures also disappointed.

The Chicago PMI fell from 61.1 to 58.2 in November, with pending home sales falling by 1.1% in October. In September, pending home sales had fallen by 2.0%.

The Market Movers

For the DAX: It was a mixed day for the auto sector on Monday. Daimler rose by 0.32% to buck the trend on the day. Continental and Volkswagen slid by 2.35% and by 3.27% respectively, however, with BMW seeing a more modest 0.04% loss on the day.

It was also a bearish day for the banks. Deutsche Bank fell by 1.44%, with Commerzbank sliding by 3.38%.

From the CAC, it was a bearish day for the banks. BNP Paribas and Credit Agricole fell by 1.96% and by 1.93% respectively. Soc Gen slid by 3.70% to lead the way down, however.

It was also a bearish day for the French auto sector. Peugeot fell by 1.13, with Renault sliding by 2.23%.

Air France-KLM also hit reverse, tumbling by 7.34%, with Airbus SE ending the day with a 2.52% loss.

On the VIX Index

It was a 5th consecutive day in the red for the VIX on Monday. Following a 1.93% decline on Friday, the VIX fell by 1.30% to end the day at 20.57.

On Monday, the Dow and S&P500 fell by 0.91% and by 0.46% respectively, with the NASDAQ slipping by 0.06%.

The downside for the VIX came in spite of the losses across the U.S benchmarks, with COVID-19 vaccine hopes weighing.

VIX 011220 Daily Chart

The Day Ahead

It’s a busy day ahead on the Eurozone economic calendar. November Manufacturing PMIs for Italy and Spain, and prelim Eurozone inflation figures for November are due out in the early part of the session.

German unemployment figures and finalized manufacturing PMIs for France, Germany, and the Eurozone are also due out.

Expect Italy, Germany, and the Eurozone’s manufacturing PMIs and Germany’s unemployment figure to have the greatest influence.

From the U.S, the market’s preferred ISM Manufacturing PMI for November will also provide direction late in the session.

Earlier in the day, China’s CAXIN Manufacturing PMI for November will set the tone following impressive NBS numbers on Monday.

Away from the economic calendar, Brexit and COVID-19 news updates will need monitoring. Any progress towards a stimulus package on Capitol Hill would influence.

The Futures

In the futures markets, at the time of writing, the Dow was up by 15 points.

For a look at all of today’s economic events, check out our economic calendar.

European Equities: A Month in Review – November 2020

The Majors

It was a particularly bullish month for the European majors in November, with COVID-19 vaccine news delivering a much-needed bounce.

After 2 consecutive months in the red, the CAC40 surged by 20.12%. The DAX30 and the EuroStoxx600 weren’t far behind, with gains of 15.01% and 13.73% respectively. For the DAX30, November’s gains reversed losses from the year to move into positive territory year-to-date. The CAC40 and EuroStoxx600 still have some way to go in order to reverse losses from earlier in the year, however.

While the news of a COVID-19 vaccine drove demand for riskier assets, Joe Biden’s victory in the Presidential Election added support for riskier assets.

On the negative side, however, was a reintroduction of lockdown measures by member states including France and Germany.

Towards the end of the month, the COVID-19 numbers reflected the effect of the lockdown measures.

In France, the number of new COVID-19 cases and hospitalizations were in decline allowing the government to ease lockdown measures going into December.

On the geopolitical risk front, last-ditch Brexit negotiations failed to deliver a deal, which left the majors in the red at the end of the month.

The Stats

It was a busy month on the Eurozone economic calendar. Looking at the private sector PMIs, it was a disappointing set of numbers for November.

Service sector activity contracted in France, Germany, and across the Eurozone as a result of a reintroduction of containment measures.

France’s services sector suffered the most, with the PMI tumbling from 46.5 to 38.0. With Germany’s Services PMI falling to 46.2, the Eurozone’s Services PMI fell from 46.9 to 41.3.

While Germany’s manufacturing sector avoided a contraction, sector activity in France contracted. The PMI fell from 51.3 to 49.1, dragging the Eurozone’s Composite PMI down from 50.0 to 45.1.

In spite of the disappointing numbers, hopes of a COVID-19 vaccine fuelled economic recovery fuelled muted the effect of the PMIs.

Other stats were mixed in the month.

Consumer and business sentiment weakened in October as a result of the 2nd wave of the pandemic and lockdown measures.

Germany’s ZEW Economic Sentiment Indicator fell from 52.3 to 32.8, with the Ifo Business Climate Index falling from 92.5 to 90.7.

Things were not much better on the consumer confidence front. The GfK Consumer Climate Indicator fell from -3.2 to -6.7.

For the Eurozone, consumer confidence also waned, with the Eurozone Consumer Confidence Index falling from -15.5 to -17.6.

On the positive front, however, were 3rd quarter GDP numbers for France, Germany, and the Eurozone. The respective economies had made progress in recovering from the 2nd quarter economic meltdown before November’s lockdown measures.

From the U.S

Labor market stats pointed to a stalling in the labor market recovery. Initial jobless claims inched up to 778k after having eased down to 709k in the 1st week of November.

While new COVID-19 cases surged across the U.S and a number of states reintroduced containment measures, COVID-19 vaccine news eased any market tensions in the month.

As a result of the jump in COVID-19 cases, consumer confidence softened in November. The CB Consumer Confidence Index fell from 101.4 to 96.1, with the Michigan Consumer Sentiment Index falling from 77.0 to 76.9.

On the positive, however, were private sector PMIs. Both the manufacturing and services sectors saw activity pick up in November.

In November, the Markit Manufacturing PMI rose from 53.4 to 56.7, with the Services PMI rising from 56.9 to 57.7.

The divergence from the Eurozone stemmed from a decision by the U.S administration to keep the economy running.

Monetary Policy

The ECB monetary policy meeting minutes, Economic Bulletin, and Financial Stability Review talked of doom and gloom.

From the minutes and other ECB reports and from ECB President Lagarde commentary, the markets are expecting further policy easing, however.

While the ECB minutes stated that there should be no commitments made, the 2nd wave COVID-19 pandemic is likely to force the ECB’s hands. It remains to be seen how far the ECB will go with a COVID-19 vaccine on the horizon.

From the FED, the FOMC meeting minutes also provided few surprises. Both central banks were focused on the effects of COVID-19 on their respective economies.

The respective minutes followed decisions by both to keep rates unchanged in the month.

The Market Movers

For the DAX: It was a bullish month for the auto sector in November. Daimler surged by 26.99%, with BMW and Continental jumping by 23.99% and by 24.73% respectively. Volkswagen trailed with a 12.52% gain in the month.

It was also a bullish month for the banks. Deutsche Bank rallied by 17.04%, with Commerzbank ending the month up by an impressive 28.8%.

From the CAC, it was a particularly bullish month for the banking sector. BNP Paribas surged by 43.95%, with Credit Agricole and Soc Gen ending the month with gains of 42.63% and 43.38% respectively.

It was also a bullish month for the auto sector. Peugeot rose by 28.06%, with Renault jumping by 56.94%.

Supported by COVID-19 vaccine news, however, it was Air France-KLM that impressed the most with a 77.94% rebound. Airbus SE also impressed, surging by 40.17%.

On the VIX Index

It was back into the red for the VIX in November, ending a run of 2 consecutive monthly gains. Reversing a 44.18% surge in October, the VIX tumbled by 45.90% to end the month at 20.57.

The downside for the VIX came as pharmas released impressive COVID-19 phase 3 clinical trial results. Talk of a vaccine being available by mid-December supported riskier assets, which sank the VIX.

In November, the Dow and NASDAQ rallied by 11.84% and by 11.80% respectively, with the S&P500 ending the month up by 10.75%.

VIX November Monthly Chart

The Month Ahead

We can expect another busy month ahead on the Eurozone economic calendar. Much of the economic data, however, will likely take a backseat in the month ahead.

We would expect COVID-19 vaccine updates and any progress towards a COVID-19 stimulus package on Capitol Hill to be key drivers.

On the geopolitical front, there’s also Brexit for the markets to consider. In late November, last-ditch talks failed to deliver an agreement. The two sides have just one month left until the end of the transition period.

Key stats that will draw interest, however, will include private sector PMIs for December, unemployment figures, and consumer and business sentiment numbers.

From the U.S, private sector PMIs, labor market numbers, and consumer confidence and spending will also influence.

There are also stats out of China that will need to continue reflecting China’s post-pandemic economic recovery.

Monday Brings Us Higher Volatility on Major Indices

Indices start the new week on local highs and then quickly collapse. The start of the European session brings buyers a bit of relief, volatility is definitely here!

DAX bounces from the lower line of the triangle.

SP500 on the other hand, bounces from the upper line of the triangle.

Gold moves gradually lower.

Oil locked in a flag, aiming the latest broken resistance.

Dollar Index heading lower again.

EURUSD do not stop the upswing.

EURAUD still defending major horizontal support.

The same goes with the USDCAD, which is holding above 1.297.

For a look at all of today’s economic events, check out our economic calendar.

XOSignals – The Best Trading Signals App

The XOSignals team aims to provide advanced financial signals for trading various markets, empowering traders to make informed decisions. This vision has led the company to create advanced financial analysis software that is available via mobile apps and as a desktop version. They offer both free and paid versions of the signals to suit every type of trader.

The Need for Trading Signals

A trade signal is a means to identify opportunities to open a trading position. These signals are not just used by retail traders but also large institutional traders, to accurately identify buying or selling opportunities for the asset of their choice. Trade signals for forex, or commodities are generated through robust technical analysis, based on the market performance of the asset, along with fundamental analysis, quantitative analysis, and other market factors, such as economic indicators.

The goal is to provide traders an automated system, devoid of human emotions and errors, to predict potential price changes and the direction of change. Apart from very simple sell and buy triggers, trading signals can also be used for modifying a portfolio. This is done by determining when it might be a good time to buy more of a certain asset and reduce investments in another. It can also be helpful in asset class allocation. It can help investors determine how to shift money among the forex, commodities, cryptos and other markets.

Additionally, trade signals also do the task of educating the trader. With these signals, traders can determine the logic behind their trades. This shortens their learning curve. However, there are multiple trading signals to choose from and not all of them are as helpful. This is why the XOSignals’ app for trading signals, compatible with both iOS and Android, can be a great way to analyse the markets.

How XOSignals Trade Signals Work

The success of the XOSignals app is evidenced by the fact that it is already being used by more than 1 million traders. The app aims to make complex market trading easy to understand and assess, even for beginner traders. The trading signals are based on software generated technical analysis. These can help identify variations of values within an economic system, long before they are witnessed in the marketplace.

Some of the inputs used by the app include:

Technical Patterns

Technical patterns are distinct formations that are created by the price movements of an asset on a chart. The pattern is identified with the help of a line connecting the common price points, such as lows or highs, or the closing prices, within a timeframe. These patterns are used to predict future price movements of the asset. Patterns can be based on ticks or seconds, minutes, hours, and even months. These can then be applied to candlestick, line, and bar charts. A trend line is the simplest form of technical patterns.

Broadly, technical patterns can be divided into two categories: continuation patterns and reversal patterns. Continuation pattens, such as ascending and descending triangles and flag patterns, indicate that an existing trend is likely to continue in the near term. On the other hand, reversal patterns, such as head and shoulders patterns, point towards a change in direction of the trend.

Moving Averages

Moving averages is a statistical calculation, used for analysing data points. The calculation is done with the help of a series of averages of the various subsets of the complete data set. The moving average helps in creating a constantly updated average price of an asset. This is achieved by smoothening out the price action. This minimises the effect of unexpected, short-term fluctuations on the price.

Moving averages are generally used for identifying the support and resistance levels, or the trend direction of a security.

Volume

Volume refers to the amount of a security or asset that is moved during a particular period of time. For instance, with stocks, the trading volume means the number of shares traded of a particular stock during one trading session. Usually, assets that see higher trading volume tend to be more liquid. This makes high volume one of the things to look for when opening a position in the market.

Interest Rates

Changes in interest rates can also lead to changes in the price of stocks, commodities and currencies. For instance, a country with a higher interest rate is considered a more attractive option for investors, since they offer higher income. This makes the currency of that nation more popular.

Volatility

Volatility is the statistical measurement of the dispersion of returns of an asset. In simple terms, volatility refers to how much swing the price of an asset experiences during a particular period. Assets that see greater volatility are considered riskier, since their price movements are more difficult to predict. But these price fluctuations also provide great trading opportunities for skilled traders. Extreme highs and lows in price can also trigger market changes.

Market Cycles

The financial markets tend to move in a cyclical manner. This essentially means that a period of price rise is likely to be followed by a period of price decline and vice versa. This is generally true whether they are non-trending or in a steady trend. A popular saying in the stock markets is “sell in May and go away.” This is based on the historically weak performance of certain stocks during the summer months, from May to October.

Market Sentiment

Market sentiment refers to the attitude of investors towards a certain financial market or an asset. It is generally used as a contrarian indicator. When there is excessive bullishness towards actual trading activity or surveys, it can point towards market tops. Conversely, a highly bearish sentiment can indicate the potential for a market bottom.

Valuation

Valuation is the process of figuring out the projected or current worth of an asset. An incredibly high valuation, in comparison to the market, stock, or sector, can lead to sell signals.

When trading signals are generated by taking all these factors into consideration, the accuracy of the signals is likely to be incredibly high.

Benefits of Using the XOSignals App

Technical analysis requires the evaluation of market occurrences at an incredibly detailed and in-depth level, which can be complex. It takes time to master the ability to read charts and identify trading signals. However, with the XOSignals mobile trading signals app, all the complete calculations are completed by the software and the result is presented in an easy-to-understand formal.

The IT professionals at XOSignals use the highest levels of security while communicating signals, with cutting edge technology being used to make market predictions. The company also offers excellent customer support to help beginners navigate the complex financial markets.

“We realised very quickly that one of the trading challenges, especially for beginners, was analysing the market effectively to identify trading opportunities. It’s something nobody talks about which creates a knowledge vacuum. That’s why we created an app that would provide support to traders, regardless of their level of experience.” stated Yossef A, Chief Operating Officer at XOSignals.

Some of the key advantages of XOSignals are:

Compatibility

Today’s traders want to stay connected to their trades even on the go. This is exactly what XOSignals helps achieve with its highly compatible app. The app can be accessed on a mobile device, desktop or tablet. Both the mobile and app and desktop platform can be used for automated trading.

The website even has an auto translation feature to French, Danish, Filipino, Spanish, German, Hindi and many other languages. So, if English is not your native language, you can still take advantage of the trading signals app. Traders can choose to receive trading signals directly on their mobile device as alerts or push notifications.

Live Trading Signals

Forex, stocks, index and crypto trading signals are available on both the demo and live account. Traders can also access live price feeds and a live charting service. With the live feed, they can choose to stay updated on the prices of chosen stocks, forex, cryptos, indices, and commodities.

Additionally, traders gain the benefit of live support where they can chat with other traders and participate in social trading. This is a great way to discuss strategies or ideas and hone trading skills. On the live chat, there are almost 1 million users across 25 countries. If a trader has questions on how to use the XOSignals app or anything else trading-related, other traders can help answer them.

In addition, traders can access educational resources to enhance their familiarity with the financial markets. They can even check the real time win ratio of their signals. This allows them to gain greater confidence in their trading decisions.

Free Forex Trading Signals

Most platforms or apps that promise free trading signals have certain hidden costs that come as a surprise to traders. Even if traders do manage to find completely free forex signals, such functionalities might not be based on robust, cutting-edge technical analysis and fundamental analysis. This makes them less accurate and reliable. In fact, they could end up doing more harm than good.

On the other hand, XOSignals offers free stocks and forex signals, which have been developed with advanced software-generated technical analysis. Therefore, the company vouches for the accuracy of the signals. To date, traders have won over 183,500 pips via these signals. This is one of the best figures in the market.

Customised Updates

To cater to the needs of diverse types of traders, XOSignals offers customised trading signals for index, commodities, forex, and crypto trading. This helps traders develop suitable trading plans for the asset of their choice. XOSignals takes into account how a specific client’s account has performed in the past, the expected future events, and what the technical indicators are pointing towards to prepare the customised updates. This feature is not offered by most of the other trading signal providers.

Forex Charts

Charts and market data are extremely important for traders. With XOSignals, traders gain quick and easy access to all analytical reports, charts, and forex data. They no longer need to search through different sites for the information they need to make trading decisions. This saves significant time and effort that would have otherwise been required to optimise a trading strategy.

Free Open Chat

With XOSignals, traders also gain access to a unique live chat. With this chat box, users can interact directly with traders from over 25 countries. To ensure smooth communication between users, the chat comes with an auto translation feature. This means that regardless of the language that the trader is comfortable with, they can exchange tips and insights with each other seamlessly. This helps create a much more inclusive and educational trading community.

Support for Beginners

The multiple trading opportunities that various financial markets offer have been increasingly attracting traders in 2020, due to the pandemic-led uncertainty. However, many give up early due to the complex nature of the markets. Among those who do try to trade, many might lose confidence in their decision making. This can be highly detrimental to trading success. XOSignals offers prompt and responsive support, while also providing rich resources through the education section on the platform.

In this section, traders can choose from six courses that offer vital training to navigate the markets. The first course introduces forex trading. This is followed by courses on how to trade forex, how to read trading signals, technical analysis, and market sentiment.

More than 5,000 traders have benefited from these courses, which have seen a success rate of around 97%.

Leaderboards

The XOSignals app also has a leaderboard feature. Here, users can follow top traders and see how they deal with various market conditions with just a click. Traders can check the total pips won, win streak, and signals chosen. This is another feature that helps educate traders and improve their trading strategy.

Free vs VIP Trading Signals

There are 2 types of accounts on the XOSignals trading signals app. The first is the basic plan, which is completely free of charge. Even with the free version, traders can access a wide range of features, such as the dashboard, live feed, leaderboards, and win ratio.

The second type of account is the VIP account, which requires a monthly fee. Traders can lower the fee by subscribing for a longer period. With the VIP account, traders gain access to features such as:

  • Daily Market Signals
  • Long Term Strategy
  • Email Signals + Support
  • Dedicated Relationship Manager
  • Trading Objectives Review
  • Free Telegram Signals
  • 1-on-1 with XOSignals Head of Research
  • Mobile Access
  • US Stocks Analysis + Signals
  • CAC, DAX Stock Analysis + Signals

“Our team is constantly innovating and improving its offerings in line with real trader demands.” added Youssef A.

XOSignal is a global trade signal provider for a wide range of financial instruments. Known for their high degree of accuracy, these trading signals are available for the forex, commodities, stocks, index and crypto markets. The XOSignals app backs the trade signals with sound technical analysis. With a successful track record of four years, the company has already garnered a user base of over 1 million traders.

Whether it’s charts or technical indicators, a visitor can explore real-time data on the platform. The XOSignal team has created an ecosystem where anyone can learn to trade without expensive software, books or tuition. With a vision that’s set to a global and diverse audience, the company also offers auto-translation features on their website.

For more information, click on: XOSignals

European Equities: The Futures Point South, with Stats on the Quieter Side

Economic Calendar:

Monday, 30th November

Spanish CPI (YoY) Prelim

Spanish HICP (YoY) (Nov) Prelim

Italian CPI (MoM) (Nov) Prelim

German CPI (MoM) (Nov) Prelim

Tuesday, 1st December

Spanish Manufacturing PMI (Nov)

Italian Manufacturing PMI (Nov)

French Manufacturing PMI (Nov) Final

German Manufacturing PMI (Nov) Final

German Unemployment Change (Nov)

German Unemployment Rate (Nov)

Eurozone Manufacturing PMI (Nov) Final

Eurozone Core CPI (YoY) Prelim

Eurozone CPI (MoM) Prelim

Eurozone CPI (YoY) (Nov) Prelim

Wednesday, 2nd December

German Retail Sales (MoM) (Oct)

Spanish Unemployment Change

Eurozone Unemployment Rate (Oct)

Thursday, 3rd December

Spanish Services PMI (Nov)

Italian Services PMI (Nov)

French Services PMI (Nov) Final

German Services PMI (Nov) Final

Eurozone Markit Composite PMI (Nov) Final

Eurozone Services PMI (Nov) Final

Eurozone Retail Sales (MoM) (Oct)

Friday, 4th December

German Factory Orders (MoM) (Oct)

IHS Markit Construction PMI (Nov)

The Majors

It was a bullish end to the week for the European majors on Friday. The CAC40 rose by 0.56%, with the DAX 30 and the EuroStoxx600 ending the day with gains of 0.37% and 0.41% respectively.

Following a mid-week blip stemming from concerns over the state of the economy, the markets returned attention to vaccine news.

With the markets expecting a vaccine to become available by mid to late December, expectations of an economic rebound in early 2021 supported riskier assets.

News of easing restrictions also provided support. The CAC40 was the main beneficiary, which found additional support from news of falling new cases and hospitalizations in France.

The Stats

It was a relatively busy day on the Eurozone economic calendar. Finalized 3rd quarter GDP, October consumer spending, and prelim November inflation figures from France were in focus.

The stats were skewed to the positive, providing the CAC40 with support through the early part of the session.

Consumer spending jumped by 3.7%, reversing most of a 4.4% slide from September. Consumer prices and the harmonized index of consumer prices both increased by 0.2% following a flat October. And finally, the French economy expanded by 18.7% in the 3rd quarter, which was revised up from a prelim 18.2%.

From the U.S

There were no material stats with the U.S markets on a half-day for Thanksgiving.

The Market Movers

For the DAX: It was a mixed day for the auto sector on Friday. BMW and Volkswagen fell by 0.83% and by 1.69% respectively. Continental and Daimler saw relatively more modest gains of 0.51% and 1.09% respectively, however.

It was a bullish day for the banks. Deutsche Bank and Commerzbank saw gains of 1.20% and 1.85% respectively.

From the CAC, it was a bullish day for the banks. BNP Paribas rose by 1.06%, with Credit Agricole and Soc Gen seeing more modest gains of 0.37% and 0.80% respectively.

It was also a bullish day for the French auto sector. Peugeot and Renault ended the day with gains of 1.14% and 1.37% respectively.

Air France-KLM continued to find support, rallying by 4.82%, with Airbus SE eking out a 0.22% gain.

On the VIX Index

It was a 4th consecutive day in the red for the VIX on Friday. Following a 1.80% decline on Wednesday, the VIX fell by 1.93% to end the day at 20.84. Thursday was a public holiday in the U.S.

On Friday, the Dow and S&P500 saw gains of 0.13% and by 0.24% respectively, with the NASDAQ rising by 0.92%.

VIX 301120 Daily Chart

The Day Ahead

It’s a relatively busy day ahead on the Eurozone economic calendar. Prelim November inflation figures are due out from Spain, Italy, and Germany.

The numbers are unlikely to have a material impact on the European majors, with further ECB policy easing priced in.

From the U.S, Chicago PMI and pending home sales are due out. Expect the Chicago PMI to have a greater influence late in the session.

NBS private sector PMIs from China due out ahead of the European open will set the tone.

Away from the economic calendar, updates from Brexit negotiations from the weekend and COVID-19 news updates will also influence.

The Futures

In the futures markets, at the time of writing, the DAX was down by 63 points, with the Dow down by 112 points.

For a look at all of today’s economic events, check out our economic calendar.

The Week Ahead – Economic Data, COVID-19 Vaccine Updates, and Brexit in Focus

On the Macro

It’s a particularly busy week ahead on the economic calendar, with 88 stats in focus in the week ending 4th December. In the week prior, 50 stats had been in focus.

For the Dollar:

It’s a busy week ahead on the economic data front.

In the 1st half of the week, the market’s preferred ISM Manufacturing PMI and ADP Nonfarm Employment Change figures are due out.

With plenty of focus on labor market conditions, the ADP figures could overshadow the ISM numbers.

On Thursday, however, both the initial jobless claims and the ISM Non-Manufacturing PMIs will draw plenty of attention.

At the end of the week, nonfarm payrolls and November’s unemployment rate will provide riskier assets with direction.

Weak numbers could force the FED into action should lawmakers continue to grapple over a stimulus package.

Away from the economic calendar, COVID-19 and U.S politics will continue to remain the key drivers, however.

The Dollar Spot Index ended the week down by 0.65% to 91.790.

For the EUR:

It’s a busy week ahead on the economic data front.

Private sector PMIs for Spain and Italy and finalized PMIs for France, Germany, and the Eurozone are due out.

On Tuesday, German unemployment figures will also be in focus alongside the manufacturing numbers.

Mid-week, German retail sales figures are due out ahead of German factory order numbers on Friday.

Other stats in the week include prelim November inflation and Eurozone unemployment and retail sales figures.

These numbers are unlikely to have a muted impact on the EUR, however.

Away from the economic calendar, COVID-19 news updates will remain a key driver in the week. Expect Brexit to also influence…

The EUR ended the week up by 0.89% to $1.1963.

For the Pound:

It’s another relatively quiet week ahead on the economic calendar.

Finalized private sector PMIs are due out on Tuesday and Thursday, with November’s construction PMI on Friday.

Barring any downward revisions, however, the stats are likely to have a muted impact on the Pound.

Sentiment towards Brexit and COVID-19 will remain the key drivers in the week.

The Pound ended the week up by 0.27% to $1.3311.

For the Loonie:

It’s a particularly busy week ahead on the economic calendar.

In the 1st half of the week, 3rd quarter and October GDP and RMPI numbers are in focus. Expect the GDP numbers to have the greatest impact.

The focus will then shift to trade and employment figures due out on Friday. Expect the employment numbers to have the greatest impact at the end of the week.

From elsewhere, private sector PMIs numbers from China, the Eurozone, and the U.S will also provide direction.

Away from the calendar, COVID-19 vaccine news and stimulus talk from Capitol Hill will also influence.

The Loonie ended the week up by 0.81% to C$1.2989 against the U.S Dollar.

Out of Asia

For the Aussie Dollar:

It’s a relatively busy week ahead on the economic calendar.

AIG manufacturing index figures are due out ahead of 3rd quarter GDP numbers on Wednesday.

The focus will then shift to trade data and retail sales figures due out on Thursday and Friday.

On the monetary policy front, the RBA policy decision on Tuesday will also draw plenty of attention. While the markets are expected rates to be left unchanged, there could be the talk of further support via its bond-buying program.

From elsewhere, private sector PMI numbers from China will also influence.

Away from the economic calendar, COVID-19 news will continue to provide direction. U.S politics could also play a role should lawmakers make progress towards a stimulus package.

The Aussie Dollar ended the week up by 1.16% to $0.7387.

For the Kiwi Dollar:

It’s a relatively quiet week ahead on the economic calendar.

November business confidence figures at the start of the week will draw interest. With the RBNZ assuring continued support disappointing numbers would test Kiwi Dollar support.

Late in the week, building consent figures for October would likely have a muted impact on the Kiwi.

From elsewhere, private sector PMI numbers from China will also provide direction in the week ahead.

The Kiwi Dollar ended the week up by 1.41% to $0.7027.

For the Japanese Yen:

It is a relatively quiet week on the economic calendar.

October industrial production and retail sales figures are due out on Monday. Both sets of numbers will be of interest, though the impact on the Yen will likely be limited.

The focus will then shift to finalized manufacturing and services PMIs are due out on Tuesday and Thursday.

Barring marked deviation from prelim figures, however, the markets will likely brush aside the numbers.

From elsewhere, economic data from China will influence.

Away from the economic calendar, any further positive updates on COVID-19 vaccines would likely ease demand for the Yen.

The Japanese Yen ended the week down by 0.22% to ¥104.09 against the U.S Dollar.

Out of China

It’s a relatively busy week ahead on the economic data front.

Private sector PMI numbers for November are due out in the week. The market’s preferred Caixin Manufacturing PMI on Tuesday will likely have the greatest impact.

Economic data from China has continued to impress. Any disappointing numbers would test market risk appetite early in the week.

The Chinese Yuan ended the week down by 0.23% to CNY6.55781 against the U.S Dollar.

Geo-Politics

U.S Politics

Following last week’s Thanksgiving holidays, the markets will look towards Capitol Hill. There will be two areas of focus. Firstly, any government interventions to curb the spread of the COVID-19 pandemic and, secondly, stimulus talks.

A failure to make progress on stimulus and reintroduction of lockdown measures would be the worst-case scenario for riskier assets.

Brexit

For the Pound and the UK economy, Brexit remains a key driver. Talks resumed on the weekend and time is rapidly running out.

With U.S President-Elect Biden also getting involved, the markets are hoping for an imminent deal.

The Weekly Wrap – COVID-19 Vaccine News Supported Riskier Assets in the Week

The Stats

It was a quieter week on the economic calendar, in the week ending 27th November.

A total of 50 stats were monitored, following 62 stats from the week prior.

Of the 50 stats, 25 came in ahead of forecasts, while 21 economic indicators came up short of forecasts. 4 stats were in line with forecasts in the week.

Looking at the numbers, 16 of the stats reflected an upward trend from previous figures. Of the remaining 35 stats, 31 reflected a deterioration from previous.

For the Greenback, it was a 2nd consecutive week in the red. The Dollar Spot Index fell by 0.65% to 91.790. In the week prior, the Dollar had fallen by 0.39% to 92.392.

Hopes of a COVID-19 vaccine before the end of the year provided riskier assets with support in the week. Softer demand for the Greenback came in spite of disappointing economic data from the U.S and the continued rise in new COVID-19 cases.

Out of the U.S

It was a busy week on the economic data front.

In the 1st half of the week, prelim private sector PMI numbers for November impressed. The all-important services PMI rose from 56.9 to 57.7, with the manufacturing PMI climbing from 53.4 to 56.7.

Consumer sentiment waned in November, however, with the CB Consumer Confidence Index falling from 101.4 to 96.1. This was to be expected, with the latest spike in new COVID-19 cases and dire labor market conditions.

Mid-week, the weekly jobless claims, core durable goods orders, 3rd quarter GDP, and personal spending figures were in focus.

The stats were mixed. Initial jobless claims rose from 742k to 778k in the week ending 20th November. The latest figure further confirmed that the labor market recovery had stalled.

Core durable goods orders impressed with a 1.3% rise in October, with personal spending rising by 0.5% to come in ahead of forecasts. Spending was down from a 1.2% rise in September, however.

2nd estimate GDP numbers for the 3rd quarter were in line with 1st estimates, which came up short of a forecasted upward revision.

Other stats ahead of the Thanksgiving holidays included finalized consumer sentiment and inflation figures.

The Michigan Consumer Sentiment Index came in at 76.9, down from a prelim 77.0. Of greater significance was softer inflationary pressures in October. The annual rate of inflation eased from 1.6% to 1.4%.

On the monetary policy front, the FOMC meeting minutes had a muted impact. The FED focus on the COVID-19 pandemic was somewhat dated following the latest COVID-19 vaccine updates.

In the equity markets, the NASDAQ rose by 2.96%, while the Dow and S&P500 gaining 2.21% and 2.27% respectively.

Out of the UK

It was a relatively quiet week on the economic data front.

Prelim private sector PMI numbers for November were in focus at the start of the week.

It was a mixed bag, with manufacturing sector activity seeing a pickup, while the services sector contracted.

The all-important services PMI slid from 52.3 to 45.8 as lockdown measures hit the sector.

Away from the economic calendar, the Pound did find some support on hopes of an imminent Brexit deal, however.

In the week, the Pound rose by 0.27% to $1.3311. In the week prior, the Pound had risen by 0.65% to $1.3275

The FTSE100 ended the week up by 0.25%, following on from a 0.56% gain in the previous week.

Out of the Eurozone

It was a busy week on the economic data front.

Prelim private sector PMIs for France, Germany, and the Eurozone were in focus at the start of the week.

With lockdown measures in place, the services sector took a hit, with the Eurozone Services PMI falling from 46.9 to 41.3.

Eurozone manufacturing sector activity eased as a result of a contraction in France, while Germany continued to report solid growth in the sector.

On Tuesday, the focus shifted to Germany. Finalized 3rd quarter GDP and November’s IFO Business Climate figures were in focus.

While an upward revision to 3rd quarter GDP numbers was positive, a slide in business sentiment disappointed. The Ifo Business Climate Index fell from 92.5 to 90.7.

The markets were expecting a deterioration in sentiment, however, which limited the impact on the EUR.

In the 2nd half of the week, Germany’s GfK Consumer Climate indicator reflected consumer sentiment towards the COVID-19 pandemic. A reintroduction of containment measures dragged the headline indicator down from -3.2 to -6.7.

From France, finalized 3rd quarter GDP, October consumer spending, and prelim inflation figures for November were in focus on Friday.

Consumer spending and inflation were the main areas of focus, with the markets less interested in 3rd quarter numbers in spite of an upward revision to 18.7%.

The stats were skewed to the positive, with consumer spending jumping by 3.7%, following a 4.4% slide in September.

Consumer prices were also on the rise. In November, consumer prices rose by 0.2%. Prices had been flat in October.

From the ECB, November’s financial stability review and monetary policy meeting minutes delivered a grim view. There was EUR resilience, however, coming from progress towards a COVID-19 vaccine.

For the week, the EUR rose by 0.89% to $1.1963. In the week prior, the EUR had risen by 0.19% to $1.1857.

For the European major indexes, it was another bullish week. The CAC40 rose by 1.86%, with the DAX30 and EuroStoxx600 gaining 1.51% and 0.93% respectively.

For the Loonie

It was a particularly quiet week on the economic data front.

There were no material stats to provide direction. The lack of stats left the Loonie in the hands of COVID-19 news updates and crude oil inventory numbers.

In the week ending 27th November, the Loonie rose by 0.81% to C$1.2989. In the week prior, the Loonie had risen by 0.32% to C$1.3095.

Elsewhere

It was a bullish week for the Aussie Dollar and the Kiwi Dollar.

In the week ending 27th November, the Aussie Dollar rose by 1.16% to $0.7387, with the Kiwi Dollar rallying by 1.41% to end the week at $0.7027.

For the Aussie Dollar

It was a relatively quiet week on the economic calendar.

Key stats included 3rd quarter construction work down and new capital expenditure figures.

The stats were skewed to the negative, with both taking a larger hit than expected in the quarter.

While the stats were disappointing, hopes of a COVID-19 vaccine by the end of the year delivered support.

For the Kiwi Dollar

It was a busier week on the economic calendar.

3rd quarter retail sales and October trade figures were in focus, with both sets of numbers beating forecasts.

Retail sales surged by 28%, reversing a 14.6% slide from the 2nd quarter, with the annual trade deficit widening to a 28-year high NZ$2,190m.

From the RBNZ, November’s Financial Stability report also delivered support to the Kiwi Dollar, while risks remained tilted to the downside.

For the Japanese Yen

It was a quiet week on the economic calendar.

November inflation figures at the end of the week failed to move the dial. A pickup in deflationary pressures was aligned with the market outlook. Tokyo’s core consumer prices fell by 0.7%, following a 0.5% decline in October.

While the inflation figures disappointed, updates on the COVID-19 vaccine eased demand for the Yen.

The Japanese Yen fell by 0.22% to ¥104.09 against the U.S Dollar. In the week prior, the Yen had risen by 0.74% to ¥103.86.

Out of China

It was a particularly quiet week on the economic data front.

There were no material stats to provide the Yuan with direction in the week.

In the week ending 27th November, the Chinese Yuan fell by 0.23% to CNY6.5781. The Yuan had risen by 0.66% to CNY6.5630 in the week prior.

The CSI300 rose by 0.76%, with the Hang Seng ended the week up by 1.68%.

European Equities: A Week in Review – 27/11/20

The Majors

It was another bullish week for the European majors in the week ending 27th November.

The CAC40 rose by 1.86% to lead the way, with the DAX30 and EuroStoxx 600 gaining 1.51% and 0.93% respectively.

Through the week, market reaction to positive COVID-19 vaccine news delivered support. Pfizer Inc. and BioNTech announced that a vaccine would be available in a matter of days after FDA approval.

The news of an imminent vaccine allowed investors to focus on an economic recovery rather than economic damage caused by the COVID-19 pandemic.

Mid-week, however, disappointing economic data from the U.S and doom and gloom from the ECB did pin the majors back.

At the end of the week, however, the focus returned to the COVID-19 vaccine, which supported a bullish end to the week.

The Stats

It was a busy week on the economic calendar.

At the start of the week, private sector PMI numbers disappointed. While Germany continued to see growth, numbers from France were particularly disappointing.

Weaker numbers led to a fall in the Eurozone’s composite PMI from 50 to 45.1, with service sector numbers doing the damage.

From Germany, 3rd quarter GDP numbers came in ahead of prelim figures, though had a muted impact.

With containment measures in place, a slide in business and consumer sentiment were negatives in the week.

At the end of the week, stats from France wrapped things up.

French consumer spending, inflation, and finalized 3rd quarter GDP numbers were in focus. The stats were all skewed to the positive providing support.

In October, consumer spending rose by 3.7%, reversing most of a 4.4% decline from September, with consumer prices on the rise in November.

Consumer prices rose by 0.2%, with the harmonized index for consumer prices also rising by 0.2%. Both had stalled in October.

For the French economy, the 3rd quarter GDP was revised up from 18.2% to 18.7%.

While the stats were positive, November’s private sector PMIs from earlier in the week supported the ECB’s plans to make a move next month.

From the ECB, November’s financial stability review and monetary policy meeting minutes pegged the majors back on Wednesday and Thursday. Doom and gloom and economic uncertainty ahead weighed on the COVID-19 vaccine optimism.

From the U.S

In the 1st half of the week, prelim private sector PMI numbers for November impressed. The all-important services PMI rose from 56.9 to 57.7, with the manufacturing PMI climbing from 53.4 to 56.7.

Consumer sentiment waned in November, however, with the CB Consumer Confidence Index falling from 101.4 to 96.1. This was to be expected, with the latest spike in new COVID-19 cases and dire labor market conditions.

Mid-week, the weekly jobless claims, core durable goods orders, 3rd quarter GDP, and personal spending figures were in focus.

The stats were mixed. Initial jobless claims rose from 742k to 778k in the week ending 20th November. The latest figure further confirmed that the labor market recovery had stalled.

Core durable goods orders impressed with a 1.3% rise in October, with personal spending rising by 0.5% to come in ahead of forecasts. Spending was down from a 1.2% rise in September, however.

2nd estimate GDP numbers for the 3rd quarter were in line with 1st estimates, which came up short of a forecasted upward revision.

On the monetary policy front, the FOMC meeting minutes had a muted impact. The FED focus on the COVID-19 pandemic was somewhat dated following the latest COVID-19 vaccine updates.

The Market Movers

From the DAX, it was a mixed week for the auto sector. Continental and Daimler saw gains of 6.45% and 1.68% while BMW and Volkswagen fell by 1.08% and by 3.19% respectively.

It was a bullish week for the banking sector, however. Commerzbank rallied by 8.52%, with Deutsche Bank ending the week up by 5.33%.

From the CAC, it was another bullish week for the banks. BNP Paribas and Soc Gen rose by 7.03% and by 7.24% respectively, with Credit Agricole rallying by 10.17%.

The French auto sector found more support. Peugeot ended the week up by 3.09%, with Renault rallying by 10.60%.

COVID-19 vaccine news delivered yet more gains for Air France-KLM, which jumped by 27.78%, while Airbus saw a more modest 1.53% gain.

On the VIX Index

It was back into the red for the VIX, marking a 3rd weekly decline in 4-weeks. In the week ending 27th November, the VIX fell by 12.07%. Reversing a 2.60% gain from the previous week, the VIX ended the week at 20.84.

For the week, the NASDAQ rose by 2.96%, while the Dow and S&P500 seeing gains of 2.21% and 2.27% respectively.

VIX 281120 Weekly Chart

The Week Ahead

It’s another busy week ahead on the Eurozone economic calendar.

November private sector PMIs for Italy and Spain are in focus, along with finalized PMIs for France, Germany, and the Eurozone.

Expect Italy’s PMI and the Eurozone’s composite PMI to draw plenty of interest barring revisions to German and French PMIs.

From Germany, employment, retail sales, and factory orders for October will draw also interest in the week. With German manufacturing sector activity holdings its ground, expect the employment and retail sales figures to have the greatest impact.

Other stats include prelim inflation figures for November, which would likely have a muted impact on the majors.

From the U.S, the market’s preferred ISM private sector PMIs, weekly jobless claims, and nonfarm figures will influence.

Out of China, manufacturing sector PMI numbers due out on Monday and Tuesday will also provide direction.

Away from the economic calendar, COVID-19 news updates and Brexit talks will also need continued monitoring.

European Equities: Economic Data, COVID-19, and Brexit in Focus

Economic Calendar:

Friday, 27th November

French Consumer Spending (MoM) (Oct)

French CPI (MoM) (Nov) Prelim

French GDP (QoQ) (Q3) Final

French HICP (MoM) (Nov) Prelim

Eurozone Consumer Confidence Final

The Majors

It was a bearish day for the European majors on Thursday, though the losses were minor with the U.S markets closed. The EuroStoxx600 fell by 0.12%, with the DAX30 and the CAC40 declining by 0.02% and by 0.08% respectively.

Economic data from Germany and the ECB’s sentiment towards the Eurozone’s economic outlook pegged the majors back.

Mid-week, Germany announced plans to extend containment measures to further curb the spread of the coronavirus. While progress towards a COVID-19 vaccine remains positive for the markets, the economic damage stemming from the 2nd wave of the pandemic will need assessment.

The Stats

It was a quiet day on the Eurozone economic calendar. German consumer sentiment figures were in focus on the day.

In December, the GfK Consumer Climate Index fell from -3.1 to -6.7. Economists had forecast a rise to -2.5.

According to the GfK survey,

  • Sentiment in November took a hit as a result of the partial lockdown.
  • The shutdown of the hotel, restaurant, and events industry, as well as the tourism industry, weighed heavily on sentiment.
  • The economic expectation indicator fell by 7.3 points to -0.2, the lowest figure since -10.4 points in May.
  • Income expectations also took a hit, falling by 5.2 points to 4.6, with the propensity to buy indicator falling by 6.5 points to 30.5.

Monetary Policy

From the ECB, the monetary policy meeting minutes were in focus later in the day.

Some key points from the minutes included:

  • After a strong rebound in the summer, the euro area’s economic recovery was losing momentum.
  • The rise in COVID-19 cases and containment measures would restrict activity levels in high contact sectors.
  • There has been a clear deterioration in the near-term economic outlook as a result.
  • Household consumption is expected to remain subdued.
  • Increased uncertainty about the economic outlook and weaker balance sheets were weighing on business investment.
  • Headline inflation declined further to 0.3% in September, with inflation excluding energy and food falling to an all-time low of 0.2%.
  • The ECB expected headline inflation to remain negative through early 2021, longer than in the September baseline projection.
  • Risks surrounding the euro area growth outlook were clearly tilted to the downside.
  • The ECB held monetary policy unchanged ahead of a new round of macroeconomic projections due out in the coming weeks.
  • In December, it was felt necessary for a recalibration of all of its instruments, as appropriate, to ensure that financing conditions remain favorable to support the economic recovery. It was noted, however, that the ECB should not pre-commit itself to specific policy actions.
  • Finally, members agreed that an ambitious and coordinated fiscal stance remained critical and was the most effective policy to deal with the effects of the pandemic.

From the U.S

There were no material stats with the U.S markets closed for Thanksgiving.

The Market Movers

For the DAX: It was a bearish day for the auto sector on Thursday. Daimler fell by 2.48%, with BMW and Volkswagen declining by 2.08% and by 2.18% respectively. Continental saw a more modest 1.35% loss on the day.

It was also a bearish day for the banks. Deutsche Bank and Commerzbank fell by 1.58% and by 0.38% respectively.

From the CAC, it was a bearish day for the banks. BNP Paribas and Credit Agricole slipped by 0.89% and by 0.47% respectively. Soc Gen fell by 1.21%, however, to lead the way down.

It was also a bearish day for the French auto sector. Peugeot fell by 0.73, with Renault sliding by 2.32%.

Air France-KLM continued to find support, rising by 1.94%, while Airbus SE fell by a further 1.86% following Wednesday’s 2.14% slide.

On the VIX Index

The U.S markets were closed on Thursday for Thanksgiving.

The Day Ahead

It’s a relatively busy day ahead on the Eurozone economic calendar. French consumer spending for October and prelim inflation figures for November are due out. Finalized 3rd quarter GDP numbers are also due out on the day.

We would expect the markets to be relatively nonresponsive to the stats, however. The focus will be on COVID-19 news and Brexit news at the end of the week.

With progress made towards a COVID-19 vaccine, expectations are that containment measures will soon ease. This would support a pickup consumption and economic activity, limiting the impact of backward-looking data. The extent of the economic damage, however, will likely dictate the shape of any economic recovery.

Late in the session, Eurozone consumer confidence figures should also have a muted impact on the majors, barring any major revisions.

From the U.S, there are no material stats, with the U.S markets on a half-day for the Thanksgiving holidays.

Away from the economic calendar, expect COVID-19 news updates and Brexit to also influence.

The Futures

In the futures markets, at the time of writing, the DAX was down by 32 points.

For a look at all of today’s economic events, check out our economic calendar.

European Equities: Brexit, Economic Data, and the ECB Minutes in Focus

Economic Calendar:

Thursday, 24th November

GfK German Consumer Climate (Dec)

ECB Publishes Account of Monetary Policy Meeting  

Friday, 25th November

French Consumer Spending (MoM) (Oct)

French CPI (MoM) (Nov) Prelim

French GDP (QoQ) (Q3) Final

French HICP (MoM) (Nov) Prelim

Eurozone Consumer Confidence Final

The Majors

It was a mixed day for the European majors on Wednesday. The CAC40 rose by 0.23%, while the DAX30 and the EuroStoxx600 slipped by 0.02% and by 0.08% respectively.

A planned easing of containment measures provided support to the European majors on the day. While Germany will reportedly allow gatherings for Christmas, France will begin to ease lockdown measures this weekend. The more aggressive plans to ease containment measures in France delivered the upside for the CAC40.

From the U.S, a continued surge in new COVID-19 cases and disappointing economic data weighed on the day, however.

The Stats

It was a quiet day on the Eurozone economic calendar. French jobseeker figures were in focus in the early part of the session.

In October, the total number of jobseekers decreased from 3,606.3k to 3,549.7k. Coupled with progress towards a COVID-19 vaccine, the numbers supported the CAC40.

From the ECB, the Financial Stability Review also failed to move the dial.

Salient points from the review included:

  • The coronavirus pandemic, and its impact on macroeconomic prospects as well as sovereign, corporate, and household balance sheets, continue to dominate the outlook for euro area financial stability.
  • Near-term financial stability risks are contained by massive policy impact. A premature end to schemes could challenge corporates and households, however.
  • Medium-term vulnerabilities have increased with rising debt burdens. Euro area banks, which have shown resilience so far, face a combination of growth asset quality concerns, persistent structural problems, and ongoing pressures on profitability.
  • Macroprudential policy must continue to focus on leaning against undue deleveraging, supporting capital buffer usability, and developing an effective framework for the non-bank financial sector.
  • The euro area economy faces a fragile and uneven recovery, notwithstanding considerable policy support.
  • Downside risks that remain include an adverse outcome of Brexit negotiations. On the plus, the availability of a vaccine in the near future may help the euro area return to pre-pandemic levels of economic activity faster.

From the U.S

It was a particularly busy day on the economic data front. Key stats included the weekly jobless claims, core durable goods, 3rd quarter GDP, and personal spending figures.

In the 3rd quarter, the economy expanded by 33.1%, according to the 2nd estimate figures. This was in line with the 1st estimate while coming up short of a forecasted 33.2%.

Core durable goods orders rose by 1.3% in October, following a 1.5% increase in September. Economists had forecast a 0.5% rise.

Personal spending followed a 1.2% increase in September with a 0.5% rise in October. Economists had forecast a 0.4% rise.

On the employment front, initial jobless claims stood at 778k in the week ending 20th November. This was up from the week prior’s 742k and was another signal that the labor market recovery was stalling.

The FED

From the FED, the FOMC meeting minutes were released after the European close, which was focused heavily on the effects of the COVID-19 pandemic.

Salient points from the Committee Policy Action section included:

  • Economic activity and employment had continued to recover but remained well below their levels at the beginning of the year.
  • Weaker demand and earlier declines in oil prices had been holding down consumer price inflation.
  • The FED was committed to using its full range of tools to support the U.S economy in this challenging time.
  • Members stated that the path of the economy would significantly depend on the course of the virus.
  • Additionally, members agreed that the ongoing health crisis would continue to weigh on economic activity, employment, and inflation in the near-term. This was posing considerable risks to the economic outlook over the medium-term.
  • Members expected to maintain an accommodative stance on monetary policy until inflation moved moderately above 2% and maximum employment was achieved.
  • Over the coming months, it would be appropriate for the FED to increase its holdings of Treasury Securities and agency MBS.
  • The FED would continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance on monetary policy as appropriate.
  • Considerations would include readings on public health, labor market conditions, inflation pressures, and expectations, and financial and international developments.

The Market Movers

For the DAX: It was a bearish day for the auto sector on Wednesday. Volkswagen slid by 2.43% to lead the way down, with BMW and Daimler seeing losses of 1.69% and 1.24% respectively. Continental ended the day down by a more modest 0.46%.

It was also a bearish day for the banks. Deutsche Bank fell by 1.06%, with Commerzbank sliding by 2.85%.

From the CAC, it was a relatively bullish day for the banks. Credit Agricole and Soc Gen rose by 0.53% and by 0.93% respectively. BNP Paribas eked out a 0.05% gain on the day.

It was also a bullish day for the French auto sector. Peugeot and Renault ended the day with gains of 0.63% and 0.22% respectively.

Air France-KLM followed Tuesday’s 11.07% surge with a 2.1% gain, while Airbus SE slid by 2.14%.

On the VIX Index

It was a 3rd consecutive day in the red for the VIX on Wednesday. Following a 4.50% decline on Tuesday, the VIX fell by 1.80% to end the day at 21.25.

The downside for the VIX came in spite of the Dow and S&P500 seeing red on Wednesday. Disappointing economic data from the U.S left the pair in the red for the day.

On Wednesday, the Dow and S&P500 fell by 0.58% and by 0.16% respectively, while the NASDAQ rose by 0.48%.

VIX 261120 Daily Chart

The Day Ahead

It’s a relatively quiet day ahead on the Eurozone economic calendar. German GfK Consumer Climate figures for December are due out later this morning.

With progress towards a COVID-19 vaccine, however, the DAX30 will likely be resilient to today’s numbers.

From the ECB, the ECB monetary policy meeting minutes will draw interest later in the day, however.

With the ECB assuring more support next month, the markets will be looking for some guidance on what to expect.

From the U.S, there are no material stats, with the U.S markets closed for Thanksgiving.

Away from the economic calendar, expect COVID-19 news updates and Brexit to also influence.

The Futures

In the futures markets, at the time of writing, the DAX was down by 0.50 points.

For a look at all of today’s economic events, check out our economic calendar.

Buyers Struggle to Keep Indices Higher

Indices started European session relatively high but buyers failed to hold prices in the bullish territory.

DAX creates a false bullish breakout pattern.

SP500 corrects the bullish breakout from the symmetric triangle.

FTSE with a potentially dangerous triple top formation.

Oil pushing higher but chances for a correction are rising.

Gold stays below crucial resistance on the 1850 USD/oz.

Dollar Index fights on important mid-term support.

AUDUSD defends upper line of the ascending triangle.

EURUSD defends 1.19.

For a look at all of today’s economic events, check out our economic calendar.

European Equities: Futures Point North ahead of a Data Deluge from the U.S

Economic Calendar:

Wednesday, 23rd November

ECB Financial Stability Review

France Jobseekers Total

Thursday, 24th November

GfK German Consumer Climate (Dec)

ECB Publishes Account of Monetary Policy Meeting  

Friday, 25th November

French Consumer Spending (MoM) (Oct)

French CPI (MoM) (Nov) Prelim

French GDP (QoQ) (Q3) Final

French HICP (MoM) (Nov) Prelim

Eurozone Consumer Confidence Final

The Majors

It was a bullish day for the European majors on Tuesday. The DAX30 and the CAC40 rose by 1.26% and by 1.21% respectively, with the EuroStoxx600 gaining 0.91%.

Positive updates on the COVID-19 vaccine front continued to support the majors on the day. News of Trump agreeing to the transition and of previous FED Chair Yellen joining the new administration also delivered a boost.

On the economic data front, a fall in business sentiment failed to weigh on the DAX30 and broader risk sentiment. Progress towards a COVID-19 vaccine muted any disappointing numbers on the day.

The Stats

It was a relatively busy day on the Eurozone economic calendar. Finalized 3rd quarter GDP and November IFO Business Climate Index figures for Germany were in focus.

In the 3rd quarter, the German economy expanded by 8.5%, partially reversing a 9.7% contraction from the 2nd quarter.

Year-on-year, the economy contracted by 3.9%. In the 2nd quarter, the economy had contracted by 11.3%.

Both were revised upwards from 1st estimate numbers.

On the business sentiment front, the IFO Business Climate Index fell from 92.5 to 90.7 Economists had forecast a decline to 90.1. Weighing on sentiment was a fall in business expectations, which slid from 94.7 to 91.5. The current assessment indicator saw a marginal decline from 90.4 to 90.0 for November.

From the U.S

Consumer confidence figures were in focus. In November, the CB Consumer Confidence Index fell from 101.4 to 96.1. Economists had forecast a decline to 98.0. COVID-19 vaccine news is likely to give consumers a boost, however, which muted the impact of the softer than expected number.

The Market Movers

For the DAX: It was a particularly bullish day for the auto sector on Tuesday. Continental rallied by 5.60% to lead the way, with Volkswagen rising by 3.98%. BMW and Daimler weren’t far behind with gains of 3.31% and 3.19% respectively.

It was a bullish day for the banks. Deutsche Bank rose by 2.98%, with Commerzbank rallying by 4.35%.

From the CAC, it was a particularly bullish day for the banks. BNP Paribas and Credit Agricole rallied by 5.41% and by 5.48% respectively. Soc Gen saw a more modest 4.14% gain on the day.

It was also a bullish day for the French auto sector. Peugeot rose by 2.59%, with Renault rallying by 6.87%.

Vaccine news continued to support airline stocks, with Air France-KLM surging by 11.07%, while Airbus SE saw a more modest 3.73% gain.

On the VIX Index

It was a 2nd consecutive day in the red for the VIX on Tuesday. Following a 4.39% decline on Monday, the VIX fell by 4.50% to end the day at $21.64.

COVID-19 vaccine news and news of Joe Biden being given the green light for an orderly transition weighed on the VIX.

On Tuesday, the Dow rose by 1.54%, with the NASDAQ and S&P500 seeing gains of 1.62% and 1.31% respectively.

VIX 251120 Daily Chart

The Day Ahead

It’s a relatively quiet day ahead on the Eurozone economic calendar. French jobseeker totals are due out later today.

With the markets expecting labor market conditions to deteriorate, however, the numbers should have a muted impact on the majors.

Of greater interest will be the ECB Financial Stability Review that is due out ahead of the French data.

The ECB is expected to make a move next month. With November PMIs disappointing, the Review could give some idea of what to expect from the ECB.

From the U.S, it is a particularly busy day on the economic calendar ahead of the market close on Thursday.

Key stats include the weekly jobless claims, core durable goods, 2nd estimate GDP, and personal spending figures.

Away from the economic calendar, expect COVID-19 news updates, any stimulus talk from Capitol Hill, and Brexit to also influence.

The Futures

In the futures markets, at the time of writing, the Dow was up by 138 points, with the DAX up by 76.5 points.

For a look at all of today’s economic events, check out our economic calendar.

European Equities: Economic Data from Germany, COVID-19, and Lagarde in Focus

Economic Calendar:

Tuesday, 22nd November

German GDP (Q3) Final

German IFO Business Climate Index (Nov)

ECB President Lagarde Speaks

Wednesday, 23rd November

ECB Financial Stability Review

France Jobseekers Total

Thursday, 24th November

GfK German Consumer Climate (Dec)

ECB Publishes Account of Monetary Policy Meeting  

Friday, 25th November

French Consumer Spending (MoM) (Oct)

French CPI (MoM) (Nov) Prelim

French GDP (QoQ) (Q3) Final

French HICP (MoM) (Nov) Prelim

Eurozone Consumer Confidence Final

The Majors

It was a relatively bearish start to the week for the European majors on Monday. The EuroStoxx600 fell by 0.20%, with the DAX30 and the CAC40 seeing losses of 0.08% and 0.07% respectively.

Concerns over further lockdown measures to contain the COVID-19 pandemic weighed, as new COVID-19 cases continued to spike.

While November’s prelim private sector PMIs had failed to send the majors into the red early in the session, further economic stress is anticipated.

The combination of disappointing PMI numbers and the continued rise in new COVID-19 cases did the damage. Earlier in the day, clinical trial data from AstraZeneca had also failed to impress, with a 90% efficacy rate coming up short of those of Pfizer Inc. and Moderna Inc.

Talk from Pfizer Inc. of a vaccine being available in the U.S by mid-December had provided support early in the session, however.

The Stats

It was a busy day on the Eurozone economic calendar. Prelim November private sector PMI numbers for France, Germany, and the Eurozone were in focus.

France’s manufacturing PMI slipped from 51.0 to 49.1, with the Services PMI falling from 46.5 to 38.0. Both PMIs fell to 6-month lows in November, according to prelim figures.

From Germany, the Manufacturing PMI fell from a 30-month high 58.0 to 57.9. The Services PMI fell from 49.5 to a 6-month low 46.2.

For the Eurozone, the Manufacturing PMI fell from a 26-month high 54.8 to 53.6, with the Services PMI declining from 46.9 to a 6-month low 41.3.

As a result of the deeper contraction in the services sector, the Eurozone’s Composite PMI fell from 50.0 to a 6-month low of 45.1.

According to the Eurozone’s prelim October Survey,

  • Business activity fell sharply as countries reintroduced more aggressive measures to contain the COVID-19 pandemic.
  • Service sector activity was hardest hit, with the rate of decline in sector output the most marked since May.
  • Manufacturers saw the slowest rate of increase in new orders over the past 5-months. For service sector firms, new business collapsed by levels not seen since May.
  • By member state, Germany bucked the wider downturn trend.
  • For France, by contrast, the composite fell by the steepest rate since May.
  • Employment fell across the Eurozone for a 9-consecutive month, though employment in Germany rose for the 1st time since February.

From the U.S

November’s prelim private sector PMIs were also in focus late in the European session.

The Manufacturing PMI rose from 53.4 to 56.7, with the services PMI increasing from 56.9 to 57.7. As a result, the composite PMI rose from 56.3 to 57.9.

According to November’s prelim survey,

  • The services PMI hit a 68-month high, with the manufacturing PMI hitting a 74-month high.
  • Firms reported a marked increase in new orders, with the rate of increase the fastest since Jun-18.
  • Domestic demand drove the surge in new orders, with new export business only seeing marginal increases.
  • Labor market conditions also improved, with the rise in employment the steepest since records began in 2009.
  • Optimism hit its highest level since 2014, supported by an end to election uncertainty and hopes of a COVID-19 vaccine.

The Market Movers

For the DAX: It was another mixed day for the auto sector on Monday. Continental rose by 2.27% to lead the way, with BMW and Daimler seeing gains of 0.47% and 1.32% respectively. Volkswagen fell by 0.69%, however, to buck the trend on the day.

It was a bullish day for the banks. Deutsche Bank rose by 3.82%, with Commerzbank rallying by 5.54%.

From the CAC, it was a bullish day for the banks. BNP Paribas and Soc Gen rose by 1.32% and by 2.41% respectively. Credit Agricole jumped by 4.07%, however, to lead the way.

It was a mixed day for the French auto sector. Peugeot fell by 0.54%, while Renault ended the day up by 4.28%.

Air France-KLM rallied by 5.37%, while Airbus SE saw a more modest 1.69% gain.

On the VIX Index

It was back into the red for the VIX on Monday. Reversing a 2.55% gain from Friday, the VIX fell by 4.39% to end the day at 22.66.

Talk of Pfizer Inc. delivering a vaccine by mid-December and upbeat private sector PMI numbers from the U.S delivered support.

The upside came in spite of a continued rise in new COVID-19 cases and the latest round of containment measures.

On Monday, the Dow rose by 1.12%, with the NASDAQ and S&P500 seeing gains of 0.22% and 0.56% respectively.

The Day Ahead

It’s a relatively busy day ahead on the Eurozone economic calendar. Finalized 3rd quarter GDP and IFO Business Climate figures for November are due out of Germany.

With the Eurozone economy at the mercy of the COVID-19 2nd wave, the business climate figure will likely have the greatest impact.

On the monetary policy front, ECB President Draghi is also scheduled to speak late in the session. Any forward guidance on monetary policy will influence.

From the U.S, consumer confidence for November will also provide direction late in the day.

Away from the economic calendar, COVID-19 news updates and any chatter from Capitol Hill will need monitoring.

The Futures

In the futures markets, at the time of writing, the Dow was up by 16 points.

For a look at all of today’s economic events, check out our economic calendar.

Monday Starts Promising for Indices and Commodities

Indices starts the new week on the front foot.

SP500 is inside the short-term symmetric triangle pattern.

Nasdaq is in the same formation but in the long-term.

DAX is inside of the ascending triangle formation awaiting bullish breakout.

Gold still trades above 1850 USD/oz.

Brent Oil flies away after breaking the upper line of the triangle.

Dollar Index attacking crucial horizontal support.

AUDUSD attacking the upper line of the triangle.

EURAUD is about to test the lower line of the long-term sideways trend.

For a look at all of today’s economic events, check out our economic calendar.

 

European Equities: Private Sector PMIs in Focus

Economic Calendar:

Monday, 21st November

French Manufacturing PMI (Nov) Prelim

French Services PMI (Nov) Prelim

German Manufacturing PMI (Nov) Prelim

German Services PMI (Nov) Prelim

Eurozone Manufacturing PMI (Nov) Prelim

Eurozone Markit Composite PMI (Nov) Prelim

Eurozone Services PMI (Nov) Prelim

Tuesday, 22nd November

German GDP (Q3) Final

German IFO Business Climate Index (Nov)

ECB President Lagarde Speaks

Wednesday, 23rd November

ECB Financial Stability Review

France Jobseekers Total

Thursday, 24th November

GfK German Consumer Climate (Dec)

ECB Publishes Account of Monetary Policy Meeting  

Friday, 25th November

French Consumer Spending (MoM) (Oct)

French CPI (MoM) (Nov) Prelim

French GDP (QoQ) (Q3) Final

French HICP (MoM) (Nov) Prelim

Eurozone Consumer Confidence Final

The Majors

It was a bullish end to a bullish week for the European majors on Friday. The DAX30 and CAC40 both rose by 0.39%, with the EuroStoxx600 gaining 0.52%.

The upside at the end of the week came as the markets continued to look towards a COVID-19 vaccine to end the pandemic.

Gains were limited, however, with the latest containment measures across the EU and the U.S to deliver a heavy blow to the respective economies.

The Stats

It was a relatively quiet day on the Eurozone economic calendar. German wholesale inflation and Eurozone consumer confidence figures were in focus on the day.

Wholesale sale inflation figures from Germany were in line with forecasts. The producer price index rose by just 0.1% in October, following a 0.4% increase in September.

From the Eurozone, consumer confidence deteriorated amidst the 2nd wave of the COVID-19 pandemic. The Eurozone’s consumer confidence indicator slipped from -15.5 to -17.6 for November. Economists had forecast a decline to -17.7.

From the U.S

There were no material stats to provide the majors with direction late in the session.

The Market Movers

For the DAX: It was another mixed day for the auto sector on Friday. Daimler rose by 0.43% to buck the trend on the day. Continental and Volkswagen both fell by 0.68%, with BMW ending the day down by 0.47%.

It was also a mixed day for the banks. Deutsche Bank fell by 0.20%, while Commerzbank rose by 0.67%.

From the CAC, it was also a mixed day for the banks. BNP Paribas and Credit Agricole rose by 0.36% and by 0.86% respectively. Soc Gen bucked the trend, however, falling by 0.14%

It was a bearish day for the French auto sector. Peugeot and Renault fell by 0.89% and by 0.95% respectively.

Air France-KLM eked out a 0.02% gain, while Airbus SE declined by 0.77%.

On the VIX Index

It was back into the green for the VIX on Friday. Partially reversing a 3.06% fall from Thursday, the VIX rose by 2.55% to end the day at 23.70.

A late pullback across the U.S equity markets delivered the upside for the VIX on the day.

Disagreements between the U.S Treasury and the FED on the use of emergency funds weighed on risk appetite late in the day.

On Friday, the Dow and S&P500 fell by 0.75% and by 0.68% respectively, with the NASDAQ ended the day down by 0.42%.

The Day Ahead

It’s a particularly busy day ahead on the Eurozone economic calendar. November’s prelim private sector PMI numbers for France, Germany, and the Eurozone are due out later today.

Expect sensitivity to the numbers as the markets look to get a sense of what damage the 2nd wave is having on the economy.

Service sector activity is likely to see a more material impact as a result of the reintroduced containment measures.

From the U.S, November’s prelim private sector PMIs will also influence late in the session.

Away from the economic calendar, COVID-19 news updates and any chatter from Capitol Hill will provide direction.

The Futures

In the futures markets, at the time of writing, the Dow was down by a modest 44 points.

For a look at all of today’s economic events, check out our economic calendar.