{"id":160014,"date":"2019-11-18T07:30:03","date_gmt":"2019-11-18T12:30:03","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=160014"},"modified":"2019-11-18T07:13:01","modified_gmt":"2019-11-18T12:13:01","slug":"trade-headlines-remain-markets-key-driver","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/11\/trade-headlines-remain-markets-key-driver\/","title":{"rendered":"Trade headlines remain market\u2019s key driver"},"content":{"rendered":"<div id=\"inves-1310539526\" class=\"inves-below-title-posts inves-entity-placement\"><div id =\"posts_date_custom\"><div align=\"left\">November 18, 2019<\/div><hr style=\"border: none; border-bottom: 3px solid black;\">\r\n<\/div><\/div><p><strong>By Hussein Sayed, Chief Market Strategist (Gulf &amp; MENA), <a href=\"http:\/\/countingpips.com\/contributors\/contributor-profile-forextime\/\">ForexTime<\/a><\/strong><\/p>\n<div class=\"article-body\">\n<div class=\"field-body\">\n<div class=\"field-items\">\n<div class=\"field-item even\">\n<ul>\n<li><em>Trade optimism continues to support equities<\/em><\/li>\n<li><em>China cuts rates on seven-day reverse repurchase agreements<\/em><\/li>\n<li><em>Markets awaiting FOMC minutes on Wednesday<\/em><\/li>\n<\/ul>\n<p>US equities rallied last week to new record levels with the Dow Jones Industrial Average breaching 28,000 for the first time. Soft economic data, Trump\u2019s impeachment hearing, Hong Kong protests, and Middle East unrest were all considered secondary factors in investment decisions. Anticipation of a \u201cphase one\u201d trade deal between the largest two economies continued to be the major driver for stock markets.<\/p>\n<p>Despite no new information on what the trade deal looks like or when and where it will be signed, positive headlines from US and Chinese officials are still driving equities higher. Late Thursday, White House Economic Adviser Larry Kudlow said, \u201cwe are coming down to the short strokes.\u201d China\u2019s Vice Premier Liu He had a phone call on Saturday with U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, which has been described as \u201cconstructive discussions\u201d according to state media outlet Xinhua.<\/p>\n<p>From past experiences, it\u2019s the final stages of the trade agreement where things get stuck. It remains to be seen whether this time we\u2019ll get a breakthrough, but if no agreement is reached, expect to see a nasty selloff in risk assets.<\/p>\n<p>China\u2019s central bank decision to cut rates on seven-day reverse repurchase agreements also supported risk taking. The move by the PBOC reminded investors that there are still monetary tools available to support the economy.<\/p>\n<p>Currency traders are also monitoring trade talks closely. According to the latest CFTC report, speculators raised their bullish bets on the USD, but given the weaker than expected US data, particularly industrial output which dropped to its worst level since May 2018, the greenback sold off against its major peers.<\/p>\n<p>Expect major currencies to remain in tight ranges until the release of the minutes from the Federal Reserve\u2019s October meeting on Wednesday. During his testimony to US Congress last week, Fed Chair Jerome Powell reiterated his message that the current stance of monetary policy remains appropriate as long as incoming information about the economy remain consistent with their outlook of moderate economic growth and a strong labor market.<\/p>\n<p>Powell seemed to convince markets that there isn\u2019t a fourth consecutive rate cut coming in December. According to the CME FedWatch Tool, speculators are seeing zero chance of a rate cut next month. However, they still expect a high probability of easing in 2020. What traders would like to know from the upcoming FOMC minutes is what thresholds are required for additional easing in the upcoming months.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<p><em><strong>Disclaimer: <\/strong>The content in this article comprises personal opinions and should not be construed as containing personal and\/or other investment advice and\/or an offer of and\/or solicitation for any transactions in financial instruments and\/or a guarantee and\/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.<\/em><\/p>\n<\/div>\n<hr \/>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-54242 alignleft\" src=\"https:\/\/www.countingpips.com\/articles-analysis\/wp-content\/uploads\/2014\/07\/Forex-Time-Logo.png\" alt=\"Forex-Time-Logo\" width=\"262\" height=\"90\" \/><strong>Article by <span style=\"text-decoration: underline;\"><a href=\"https:\/\/www.countingpips.com\/contributors\/contributor-profile-forextime\/\">ForexTime<\/a><\/span><\/strong><\/p>\n<p><strong>ForexTime Ltd (FXTM)<\/strong> is an award winning international online forex broker regulated by CySEC 185\/12 <a href=\"http:\/\/www.forextime.com\" target=\"_blank\" rel=\"noopener noreferrer\">www.forextime.com<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>By Hussein Sayed, Chief Market Strategist (Gulf &amp; MENA), ForexTime Trade optimism continues to support equities China cuts rates on seven-day reverse repurchase agreements Markets awaiting FOMC minutes on Wednesday US equities rallied last week to new record levels with the Dow Jones Industrial Average breaching 28,000 for the first time. Soft economic data, Trump\u2019s [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-160014","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/160014","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=160014"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/160014\/revisions"}],"predecessor-version":[{"id":160027,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/160014\/revisions\/160027"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=160014"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=160014"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=160014"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}