Manufacturing PMIs released throughout the day have made for pretty miserable reading and even those in China barely registered any growth after a lengthy period of contraction.
The Chinese data did offer some cause for hope at least, despite ultimately barely sitting in growth territory. The trajectory is positive and boosted by targeted stimulus measures that are seemingly working. External demand remains a problem but a bump in domestic demand is promising.
The sector in Europe is looking particularly grim with demand remaining extremely weak, backlogs falling and layoffs expected to accelerate over the months ahead. That's unless we can see a rebound in activity which is looking very unlikely at this stage with the global economy struggling for any positive momentum against the backdrop of high interest rates.
The PMIs from the US were a little better, particularly the ISM reading which significantly beat expectations but even here, it remains below 50 and therefore in contraction territory. With interest rates set to remain "higher for longer", things aren't likely to dramatically improve for the sector.
Volatile start for oil ahead of OPEC+ meeting
It's been a volatile start to the week for oil, with prices initially rising before falling negative to trade almost 2% lower on the day. We've had a vast selection of PMIs to bear in mind today, as well as speculation around the OPEC+ decision on Wednesday and, of course, the US averted a government shutdown.
I'm not sure all of this is a net negative for oil, per se, but it was trading at very high levels prior to this and had already started to lose momentum so perhaps what we're seeing is a case of profit-taking. Especially given the proximity to the OPEC+ meeting on Wednesday.
Higher yields hammering Gold prices
Gold is getting hammered by higher bond yields, with the yellow metal slipping another 1% today, weighed down by a stronger dollar. The next major area of support for gold is around $1,800 but if yields keep rising, that may not put up much of a fight. Of course, there's no guarantee we will keep seeing yields rising but there's no doubt the recent trend in gold has been extremely bearish and aggressive.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities.
Opinions are the authors — not necessarily OANDA’s, its officers or directors. OANDA’s Terms of Use and Privacy Policy apply. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
Recommended Content
Editors’ Picks
EUR/USD suffers worst decline in months, stays below 1.0900
EUR/USD lost almost a hundred pips on Thursday, having the worst day in months. The Euro lost ground across the board while the US Dollar had a mixed performance after US data pointed to softer inflation and a more balanced labor market.
GBP/USD consolidates losses around 1.2600
GBP/USD pulled back sharply on Thursday amid a stronger US Dollar supported by higher Treasury yields. The pair found support above 1.2600 and is consolidating around 1.2620.
Gold eases as investors rush away from safety
Financial markets turned optimistic after US inflation eased further in November. Speculative interest increases bets of a shift in central banks' monetary policy. XAU/USD is in a bearish corrective decline in the near term, slide should remain limited.
Kyber exploiter asks for complete control of all assets after nearly $50 million exploit
Kyber Network, a cross-chain decentralized exchange and aggregator, was hit by an exploit that drained nearly $50 million in cryptocurrencies from its liquidity pools. The exploiter contacted the team, asking them to await a statement concerning a “potential treaty.”
Salesforce rally helps Dow Jones outpace NASDAQ, S&P 500 on Thursday
Salesforce (CRM) is the main story on Thursday. The enterprise software company utilized artificial-intelligence-based (AI) integrations in its product suite to grow profits and revenue for the third quarter.