03.01 - Stocks reach new highs, USD recovers
There’s a lot of things going on in the markets right now. Global stocks are reaching new highs as sentiment remains positive. The USD is recovering from recent losses and the Fed will release its minutes later today. Elsewhere, Oil prices remain near multi years high. these are all the top things you need to know for today’s trading in the finance markets.
The Federal Reserve will release minutes of its December policy meeting on Wednesday at 19:00 GMT.
The U.S. central bank hiked interest rates for a third time in 2017 at the conclusion of its two-day policy meeting on December 14, in what was a widely anticipated decision and indicated that it would stay on a similar path next year.
The central bank also said it expected inflation to remain below its target for another year, tempering expectations for an accelerated pace of rate hikes in 2018.
Investors will also keep an eye out for the December manufacturing purchasing managers’ index (PMI) from the Institute of Supply Management (ISM) at 15:00 GMT.
While waiting for fresh data, the dollar underwent a modest recovery against major Forex rivals on Wednesday, breaking a five-day losing streak.
The greenback started off 2018 in the doldrums, after registering its largest annual drop, nearly 10%, in 14 years.
The U.S. dollar weakened in 2017 as the global economy gained momentum fueling expectations for tighter monetary policy in other countries, which would lessen the divergence between the Federal Reserve and other central banks.
Some analysts signaled the possibility that the Fed may surprise markets in 2018 if the recently passed tax overhaul manages to boost the American economy and fuel inflation, forcing a faster-than-expected pace of tightening.
At 11:09 GMT, the U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, gained 0.21% at 91.75.
Global stocks began to get back to business as usual at the start of 2018, with most major bourses, with the exception of Japan, back in full-swing.
U.S. futures pointed to a continuation of the rally on Wednesday after Wall Street closed at record highs a day earlier.
Elsewhere, European shares were mostly higher on Wednesday as traders watched for indications of the impact from new financial market rules.
Earlier, Asian shares ended Wednesday near record highs as bullish sentiment supported buying. The Tokyo Stock Exchange was closed for a holiday.
Oil prices continued to march higher on Wednesday as market participants eyed developments in Iran. The country was staging pro-government rallies on the back of six days of protests, although Iranian oil production seemed so far to be unaffected.
U.S. crude oil futures rose 0.27% to $60.53at 11:12 GMT, while Brent oil advanced 0.23% to $66.72.
The gains came ahead of weekly U.S. inventory data, delayed by one day more than normal due to Monday’s New Year’s holiday.
The American Petroleum Institute will release its weekly stockpile data after the market close on Wednesday while the official U.S. government data will be released on Thursday amid expectations for a draw of 5.3 million barrels.
- by Roger Gain