wnol.info October 18 2017


World Stocks Reach New Peak as Fed-Focused Week Begins

October 18 2017, 11:05 | Alonzo Simpson

Fed balance sheet BIMore

Fed balance sheet BI

Elsewhere, EUR/USD added 0.13% to 1.2010, while GBP/USD climbed 0.58% to 1.3578, re-approaching Monday's 15-month peak of 1.3620.

The pan-European FTSEurofirst 300 index closed up 0.1 percent, while MSCI's gauge of stocks across the globe gained 0.20 percent.

Analysts said despite the expected rise in borrowing costs, investors were still piling into equity markets on renewed hopes that Trump can push through the market-friendly policies that helped drive a global rally at the start of the year. On Wall Street, the futures for the Dow Jones industrial average and for the Standard & Poor's 500 were up 0.2 percent.

The currency has fallen more than 11 percent this year so far, as expectations for pro-growth, pro-inflation policies from U.S. President Donald Trump - the so called "Trumpflation trade" - have receded, making the Fed's monetary policy path trickier.

Canada's benchmark stock index posted its highest closed in almost six weeks on Monday, led by gains for its heavyweight energy sector, while financials and industrials also gained ground.

Investors will be keeping a close watch on the U.S. central bank as policymakers have to deal with the fallout from hurricanes Harvey and Irma, which hammered the country and are expected to hit economic growth. Forecasters expect the Fed to leave rates unchanged and stick to plans to raise rates in December.

Persistently weak readings of inflation that have remained below the Fed's 2 percent target rate have been a concern for policymakers.

With the economic calendar lacking significant releases during the Asian session, the dollar index was mainly flat at 91.88 as investors were waiting for the two-day FOMC meeting ending on Wednesday. At the close on Tuesday, the futures markets implied traders saw a 58.3 percent chance of a rate increase at year-end, according to the CME FedWatch tool. Sources told Reuters on Sunday that Japanese Prime Minister Shinzo Abe was considering calling a snap election for as early as next month to take advantage of his improved approval ratings and disarray in the main opposition party.

That plan, anticipated by markets and not expected to have much immediate impact, will limit the amount of maturing bonds used each month to purchase new ones.

US crude oil prices CLc1 edged up 2 cents to settle at $49.91 a barrel, after hovering near multimonth highs.

US crude futures were down 1 cent at $49.90 per barrel, within sight of Thursday's almost four-month high of $50.50.

US crude futures CLc1 rose 2 cents to settle at $49.91, while Brent crude futures LCOc1 fell 14 cents to $55.48.

CURRENCY: The dollar rose to 111.39 yen from Friday's 110.82 yen.

- Crude oil futures were higher with West Texas Intermediate crude oil for delivery in October up 0.8% at $50.31 and Brent crude for delivery in November up 0.5% at $55.88.



Other news