Today investors' attention is focused on the US nonfarm payrolls report

The US stock market traded mixed yesterday. At the close of the stock market the Dow Jones index decreased by 0.09%, the S&P 500 index increased by 0.42%, the NASDAQ index added 0.81%. The US Commerce Department release showed that the country's trade deficit increased to a record $80.9 billion in September from a revised $72.8 billion in August. The initial US jobless claims were 269,000 (forecast 275,000, previous 281,000), the lowest one since the pandemic began. Today, the US non-farm payrolls report will also be released. Analysts expect to see employment rise to 455,000 (previous 197,000).

Former head of the Fed Robert Heller said: "I think the Federal Reserve is behind the curve. They are starting to reduce the taper a little bit. There shouldn’t be any purchase of mortgage-backed securities in this booming housing market. And the U.S. government doesn’t need any support really either. ... I would reduce the asset purchases very quickly within two months or something like that, have it down to zero. And the policy rate I would start to lift right at the beginning of the year to get it back to a normal policy stance that is no longer further stimulating the economy."

Yesterday, European stock indices closed in the green area. Britain's FTSE 100 increased by 0.43%, Germany's DAX added 0.44%, France's CAC 40 increased by 0.53%, Italy's FTSE MIB added 0.53%, and Spain's IBEX 35 increased by 0.10%. Data from Germany's economy ministry released on Thursday indicated that the country's factory orders increased by 1.3% in September compared to the previous month. Analysts had expected to see an increase of 2%. The European service business activity index was 54.6 (previous value 54.7). This has been the slowest growth rate of service sector activity since April. The UK central bank did not change its monetary policy which came as a surprise to analysts. The Bank of England kept the interest rate at 0.1% and asset purchases at 895 billion pounds per month but hinted at the intention to hike the rate soon. On the back of this news, the British pound sharply fell. Analysts are now delaying expectations of the firstrate hike until February next year.

The oral antiviral drug against Covid-19 Molnupiravir from Merck and Ridgeback received approval in the UK.

OPEC+ ministers supported the decision to increase oil production by 400 thousand bpd and refused to increase supplies by 600 - 800 thousand bpd as the US, Japan and India had previously requested. OPEC+ representatives believe that such rates of oil production will be enough to cover demand in winter. Oil reserves will start to rise in December. The next meeting of OPEC+ will be held on December 2, 2021. Oil prices fell sharply amid this news.

The cost of aluminum fell below $2.6 thousand per ton for the first time since August 26.

The world food price index rose by 3% in October compared to September. It has been a record level since July 2011.

Asia-Pacific (APAC) stock indices were mostly decreasing on Friday amid renewed worries about the situation in the Chinese real estate sector. Japan's Nikkei 225 decreased by 0.61%, China's blue-chip CSI 300 decreased by 0.54%, Hong Kong's Hang Seng lost 1.69% However, Australia's ASX 200 was the exception and increased by 0.39%. The Reserve Bank of Australia, in its monetary policy statement today, indicated that recent data and forecasts do not justify an interest rate hike in 2022.

Main market quotes:

S&P 500 (F) 4,680.06 +19.49 (+0.42%)

Dow Jones 36,124.23 −33.35 (−0.09%)

DAX 16,029.65 +69.67 (+0.44%)

FTSE 100 7,279.91 +31.02 (+0.43%)

USD Index 94.34 +0.48 (+0.51%)

• – Australia RBA Monetary Policy Statement (m/m) at 02:30 (GMT+2);
• – German Industrial Production (m/m) at 09:00 (GMT+2);
• – Eurozone Retail Sales (m/m) at 12:00 (GMT+2);
• – US Nonfarm Payrolls (m/m) at 14:30 (GMT+2);
• – US Unemployment Rate (m/m) at 14:30 (GMT+2);
• – Canada Unemployment Rate (m/m) at 14:30 (GMT+2);
• – Canada Ivey PMI (m/m) at 16:00 (GMT+2).

by JustMarkets, 2021.11.05

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.