Market Update

Since yesterday was a quiet day, we are concentrating on today which was much more active. This is also the last day of the week before the very important “election week”.

The highlight today was clearly the US October jobs report which has beaten estimates and had sent the US Dollar surging and most commodities and other currencies got hammered. These numbers are also a major boost to Obama’s campaign and it might play an important role.

US equity markets ended this week flat, but precious metals ended the week a little lower and should provide an interesting entry into the market, especially silver starts too look like a bargain again at a price of around $31 an oz.

Lets talk about next week, which I call the “election week” where some major events are taking place.

  • 4-5 Nov: The G-20 Finance minister meeting in Mexico could turn out to be a flop, since Mario Draghi and Timothy Geithner will not show up and its unlikely to result in any meaningful news, but its worth watching nevertheless and surprises are always possible. Therefor this event gets an importance rating: MEDIUM
  • 5 Nov: The ISM Non-Manufacturing numbers should make things interesting ahead of the election and since this is the leading indicator in the US it receives an importance rating: HIGH
  • 6 Nov: Election day in the US. The result will have a big impact on the future market and the outcome seems to be very close, but at this moment I see Obama having an advantage on Romney and if there are no more last-minute surprises we should see Obama winning. This gets an importance rating: VERY HIGH
  • 7 Nov: Europe releases its economic growth forecasts, while its still too early to give an outlook on this, it will be interesting to look at it, since at this point the US elections are over and the latest job numbers from the Euro-zone weren’t optimistic, so we might get some negative surprises. This event gets an importance rating: MEDIUM
  • 8 Nov: The Chinese Communist Party Congress is the most important political event in China and a lot of important decision will be made and an economic and social road-map will be laid down for China for the next couple of years. Also some political decisions will be made, like for example the appointment of a new Chinese President, but there is a lot of secrecy around this event and we might need to wait for the results. This event gets an importance rating: VERY HIGH
  • 8 Nov: The European Central Bank and the Bank of England meeting will be important for Europe and a lot will depend on what the economic forecast will be (announced a day before) to get any idea what measures will be announced.
    Up till now this event gets an importance rating: MEDIUM

Next week should give us momentum for the weeks to follow and lots of question marks should be answered by the end of next week.

Enjoy this weekend and take a look at the following links:

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