World News – UK – Before the Bell: Quiet day awaits as US celebrates Thanksgiving – CityAM

Equity markets were relatively calm yesterday as some traders took their profits from the bottom gained earlier in the week.

« Sentiment in the markets was fueled by a growing sense that there will be a smooth takeover from President Trump to President-elect Joe Biden, » David Madden, market analyst at CMC Markets UK, told City A. . M.. . this morning. “We have yet to hear if Mr. Trump will admit it, but it looks like he’s going to leave. ”

It has been reported that Biden plans to offer former Fed chief Janet Yellen the role of Treasury Secretary. While Yellen was in charge of the US Federal Reserve, he oversaw the return of higher interest rates, and Madden said this was “done in a timely and measured manner. ”

The US stock market will remain closed today as the country celebrates Thanksgiving. Some US-based traders and investors will also be taking Friday off. Yesterday it felt like some traders were trading for the week even though the NYSE will be open for limited trading on Friday. « Any of the financial markets open today are likely to have low volatility, » Madden said.

A large number of US economic indicators were released yesterday, in part due to today’s holidays. The unemployment claims report rose from 748. 000 to 778. 000 – the highest value in five weeks. Personal income and consumption for October were -0. 7% and 0. 5% each. Both measured values ​​showed a decline in the course of the month and fell short of the forecasts of economists. The core PCE is the Fed’s preferred measure of inflation, down from 1. 6% to 1. 4% in October.

« In August, the Fed said it would allow inflation to run above 2% for » some time « but it is going in the opposite direction. The reports suggest a decline in economic activity, ”Madden said.

The minutes of the Fed meeting in early November were released yesterday evening. « Traders felt that the central bank could try to further support the economy by changing its asset purchases – either by increasing asset purchases or by buying longer-term bonds, » Madden said.

Jerome Powell, the head of the Fed, said he still had plenty of ammunition in reserve to help the economy. Despite the slightly reluctant nature of the update, the Dow Jones and S&P 500 finished a little lower last night as traders were happy to get their books aligned before the holiday. « The NASDAQ 100 was at its highest level in over two weeks, but then again, technology stocks have underperformed recently, » noted Madden.

The equity markets in Asia are showing little gains and the European indices tend to open a little higher.

Oil rallied again yesterday, reaching its highest level since early March. At the beginning of next week, OPEC will announce its production plans for early 2021.

“There is increasing speculation that existing production will be cut by 7. 7 million barrels per day (bpd) will be held until early 2021. The original plan was to reduce the production cuts to 5. 7 million bpd. The oil has spiked lately due to optimism about the potential stories about coronavirus vaccines, ”Madden concluded.

Thanksgiving, Federal Reserve System, Stock Exchange