Will the risk-off sentiment caused by the Omicron variant persist?
29.11.2021
- Dallas Fed Manufacturing Activity Index
- Germany: Consumer Price Index (Preliminary)
Last weekend, the three major stock indices in the U.S. market all fell, creating a risk-off sentiment characterized by falling stock prices, lower interest rates, and declining oil prices. WTI crude oil prices fell sharply, dropping about 7% to around $71.70. This was due to a downturn in the outlook for oil demand caused by growing concerns over the spread of the Omicron variant of the novel coronavirus.
In the foreign exchange market, while the Dollar Index fell slightly to 96.25, the EUR/USD pair rose by about 100 pips from 1.120 to 1.133. However, from a technical perspective, the pair has been capped by the 120-period moving average on the 4-hour chart and has since pulled back. Therefore, we need to carefully assess whether this rebound will continue while monitoring the strength of the U.S. dollar.
Today, at 4:00 PM, Turkey’s trade balance; at 6:30 PM, UK mortgage approvals; at 10:00 PM, Germany’s consumer price index (flash estimate); at 10:30 PM, Canada’s third-quarter current account balance; at 12:00 AM, U.S. pending home sales;at 12:30 AM: US Dallas Fed Manufacturing Activity Index, at 2:15 AM: Remarks by ECB President Lagarde, at 4:00 AM: Remarks by BOC Governor McClem, at 4:05 AM: Remarks by NY Fed President Williams, and at 4:05 AM: Remarks by Fed Chair Powell.We will carefully assess how the market will move over the remaining two days of November.
Author: Keisuke Sakurai
