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Bitcoin's recent surge raises questions about a potential correction, with analysts suggesting a pullback to the $75,000-$80,000 range is plausible due to rising US interest rates and a strengthening dollar. While Bitcoin has outperformed Ethereum significantly this year, the market's sensitivity to US monetary policy could lead to a test of support levels around $80,000 and possibly $74,000.
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Raiffeisen Research anticipates a 0.3 percentage point reduction in eurozone economic growth due to Donald Trump's re-election, projecting a growth rate of 1.2% for the coming year. While the U.S. may benefit from tax cuts and deregulation, tariffs could lead to imported inflation, affecting consumer spending. The stock markets reacted positively, with expectations of continued gains as investors seek stability post-election.
Bridgewater Associates Co-Chief Investment Officer Bob Prince indicated that President-elect Donald Trump"s policies could lead the U.S. to miss its 2% inflation target, potentially pushing inflation closer to 3% in 18 months. This scenario may prompt Trump to nominate a more accommodating Federal Reserve chairman to facilitate interest rate cuts, as current Chair Jerome Powell"s term expires. Prince"s comments align with warnings from other investors about rising inflation under a second Trump presidency, driven by pro-business and pro-growth initiatives.
Gold prices are currently in consolidation, influenced by geopolitical uncertainties, particularly regarding Russia"s nuclear doctrine and ongoing Middle East conflicts. Eurozone inflation rose to 2.0% in October, with potential monetary policy changes from the ECB and Fed expected in December. Investors are closely monitoring upcoming speeches from Fed representatives, which may signal future interest rate adjustments.
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Asia-Pacific markets opened higher, buoyed by Wall Street gains and a Tesla rally, as investors await key speeches from Chinese financial officials at a summit in Hong Kong. The Reserve Bank of Australia is set to release minutes from its recent monetary policy meeting, where interest rates were held steady at 4.35%. Meanwhile, U.S. markets showed mixed results, with the Nasdaq rising 0.6% and the Dow Jones slipping 0.1%, amid concerns over the Federal Reserve"s rate cut trajectory.
Investors are looking for stabilization in the DAX, with a keen focus on NVIDIA's upcoming figures. Final inflation data for the eurozone is expected on Tuesday, while significant US economic indicators, including GDP figures, will be released later in the week. Monetary policy insights from Fed representatives may also influence market sentiment.
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The 10-year Treasury yield rose slightly to 4.4316% as investors anticipated new economic data and central bank insights following a week of gains. The 2-year Treasury yield dipped marginally to 4.2992%. Market focus is on upcoming comments from Fed officials and key economic indicators, including housing and consumer confidence data.
Dalal Street faced a bearish trend as benchmark indices Sensex and Nifty fell due to persistent foreign fund outflows and selling pressure in IT stocks. Remarks from US Federal Reserve Chairman Jerome Powell regarding a cautious approach to rate cuts further dampened market sentiment, with the Nifty down 0.69% and over 10% from September's all-time highs. Additionally, Citi's downgrade of Indian equities, driven by concerns over weakening earnings momentum, has negatively impacted investor confidence.
AUD/USD faced its steepest weekly decline in four months, closing 1.84% lower at 0.6461, driven by a stronger US dollar following hawkish remarks from Fed Chair Jerome Powell. Meanwhile, Australia's mixed employment data and the RBA's commitment to controlling inflation suggest a delayed rate cut until May 2025. The currency pair is nearing critical support at 0.6360 - 0.6350, with a sustained break potentially leading to further declines towards the October 2022 low of 0.6170.
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The Nifty IT index fell nearly 3% on November 18, following comments from Federal Reserve Chair Jerome Powell, who indicated no urgency to cut interest rates amid strong economic growth and persistent inflation. Major IT firms like TCS and Wipro saw declines of 2-4%, while midcap stocks also faced losses. Despite this setback, the tech index has risen 16% year-to-date, outperforming the Nifty 50's 8% gain.

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