Market Drivers – US Session – 10-12-2021

Mohamed Abdelhamid 11 December, 2021 4:33 am Commodities, Cryptocurrency, Forex Market, Global Stock Market, Market Update

The US Dollar Index (DXY) which measures the performance of the US dollar against major currencies, has slid by 0.19%, settling at 96.04 during the New York trading session.

The market sentiment was positive as the Wall Street session closed, with major US shares finishing in the green territory recording gains between 0.60% and 1.13%.

In the US bond market, Treasury yields in the short-maturity of the curve fell with 2s, 5s, and 10s dropped between 1-3 basis points, ended respectively at 0.6544%, 1.2467%, and 1.482%, each. In the long-term of the curve 20s and 30s, gained between 1-1.5 basis points, sat at 1.9138% and 1.88%, respectively.

Economic Data
US drillers this week have added oil and natural gas rigs for the sixth time in seven weeks as demand for energy keeps growing after last year’s coronavirus demand destruction.

That rig count increase comes despite oil price declines in six of the past seven weeks. The oil and gas rig count, an early indicator of future output, rose seven to 576 in the week to Dec. 10, its highest since April 2020, energy services firm Baker Hughes said in its closely followed report on Friday.

Americans’ cost of living climbed again in November and drove the rate of US inflation to a nearly 40-year of 6.8%, putting more pressure on households as they confront rising prices of fuel, food stuff, cars and house rents.

The consumer price index increased 0.8% last month, the government said Friday versus estimates of 0.7%. Consumer prices surged at the fastest pace in nearly four decades in November as Americans paid more for practically everything, hardening hot inflation as a key trait of the economic recovery.

The consumer price index rose 6.8% in November from a year ago, according to a new Labour Department report released Friday, marking the fastest increase since June 1982, when inflation hit 7.1%. The CPI – which measures a bevy of goods ranging from gasoline and health care to groceries and rents – jumped 0.8% in the one-month period from October.

Consumer confidence in the US has strengthened modestly in December according to the University of Michigan’s preliminary estimate of the Consumer Sentiment Index.

The reading of the index surged to 70.4, up compared to only 67.4 in November. This data comes above market expectations at 67.1. In the meantime, the preliminary estimate of the December Consumer Expectations index also rose to 67.8.

The better than expected US consumer sentiment figures for December are reassuring but, so far, did not have any notable impact on the USD.

Other Developments
Bitcoin ( BTC -0.69% ), Dogecoin ( DOGE -3.25% ), and Chainlink’s ( LINK -9.14% ) tokens fell roughly 10%, 17%, and 18%, respectively, so it has been another tough week of selloffs for the broader cryptocurrency market.
China Evergrande’s default status might seem like an odd catalyst to drive prices for Bitcoin and other cryptocurrencies lower, but it makes sense in the context of investors seemingly becoming more risk averse lately.

Traders await a very big week witnessing major regular monetary policymaking meetings by both the US Federal Reserve and the European Central Bank to decide the direction of their future monetary policy.

Financial markets closely follow the upcoming outcomes of those two meetings, as they can turn out to be real game changers.
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