Stocks rebound despite more weak data
It was a volatile overnight session for US indices with initial weakness on the back of disappointing economic data wiped out by increased hopes of another Fed rate cut at the end of this month. The monthly US employment report is due today.
US30USD Daily Chart
The US30 index slumped to the lowest since August 28 yesterday before rebounding strongly to close higher for the first time in three days
The index briefly traded below the 200-day moving average at 25,930 but closed above it. That moving average has held on a closing basis since August 14
Expectations are that the US economy added 145k jobs in September, more than the 130k posted in August. However, the weak ADP report on Wednesday and unimpressive employment indices in the recent PMI releases could suggest that the downside may be vulnerable.
DE30EUR Daily Chart
It was a similar story for the Germany30 index, which felt pressure early on only to recover and finish in the black for the first time in three days
The index edged toward the 200-day moving average at 11,813 but it remained untested, as it has been since August 29
In a statement yesterday, the EU Parliament said it had grave concerns about new UK Brexit plan since it does not “even remotely” work for the Irish border. There are no data releases scheduled for today for both Germany and the Euro-zone.
WTICOUSD Weekly Chart
Crude oil prices fell for an eighth consecutive day yesterday, the longest losing streak since November last year
West Texas Intermediate (WTI) hit the lowest level since August 7 and looks set to close below the 200-week moving average for the first time since January
Oil prices are still feeling pressure from the larger-than-expected increase in inventories reported by EIA to September 27. 3.1 million barrels were added to stockpiles in the week, almost double the 1.57 million barrels the market had been expecting.
