Record High For US Stocks As Market Awaits Biden Decision On Fed Chair

Okay, very good morning to you. It is Friday, 19th of November. Hope you are doing well. And in terms of the briefing, even though it's a Friday, tons of stuff for me to cover. Of course, I'll try to keep it as on point as possible, but obviously we had a really topsy-turvy day on Wall Street yesterday. Initial selling at the open, awesome hawkish Fed comments, and then a flip reversal. And I'll explain why that happened. And we actually closed at record highs in the S&P and the NASDAQ. And funny enough, if you subscribe to the Market Maker daily newsletter that I put out. If you want to, you can just find it on AmplifyMe.com at the bottom of the web page. But I wrote that yesterday at around the open because I had some meetings for the rest of the day, and I was talking about the catalysts and the reasons why it would come lower. There was also some negative type political comments on the, the new bill, Build Back Better bill they're trying to push in the US as well. And then lo and behold, I check back in after market and we finish at a record high. So standard fare, I would say, as far as markets are concerned in 2021. And as you can see here from this graphic that I've got up on my screen at the moment, the S&P 500 in fact is poised for the second biggest number of all-time highs ever in a year. And as you can see here, this would, would have to go back to really the mid-'90s, the last time we'd seen so many record highs in just one singular year. But we'll get into that in a moment. I'm also going to talk about the latest change of a US investment bank on bringing forward their rate hike expectations for the Fed, that being JP Morgan. We got COVID update. We've just had a breaking headline come out. Austria are going to make even more aggressive lockdown, and they're going to implement that from Monday given the outbreak that they're seeing of COVID at the moment. But this is being seen now in Germany, Greece, Slovakia, the US in Chicago, the UK numbers are going back up. So we'll have a bit of a COVID update. Bitcoin's down for a 5th consecutive day. We're now trading the futures market at 56,000 handle. And technicians would say that we've got a little perhaps further to go in that price point. And then we'll talk about US politics and then a look ahead for the day. We've already had UK retail sales come out. No real market impact on sterling, albeit the numbers were just a touch better than expected, came in at 0.8% month to month for October against 0.5% expected. But yeah, quick look at the charts before I go into those headline stories and The dollar is a little bit firmer this morning. It's just kind of popped up a little bit as UK, European players have stepped into the markets. They're up around 0.2% in the dollar index, and that's just pushed euro out of a really quiet phase of consolidation through much of the main part of the Asia-Pac session. So a bit of a breakdown in price as we drifted down to the S1, whereas sterling perhaps not quite as deep in negative territory, just given those aforementioned retail sales, maybe just providing some very short-term support. Otherwise, in equity index futures, uh, the S&P, NASDAQ very quiet, holding on to generally a positive handover from the US to Asia. And we've just kind of sat sideways at the R1 in the futures at around this record high territory. The DAX though just having a bit of rejection around the R1 and just dipping back down in quick fashion through the cash open down to pivot. Oil just holding on to the gains that we've seen yesterday following some of the downside pressure that we've had throughout recent trading sessions. So we're back to a 79 handle at the moment. Just looking here on some of the technical setup, 3 tests on that trend line through the price recovery. So around 78.83 I'd be looking at and watching for some support. And you can see psychologically finding some short-term— so 70 again, such as politics, it's just the latest thing. I don't think it's too meaningful to be honest. But yeah, will they vote today? Perhaps. Would it get delayed? Perhaps. Does it mean a lot for markets? Not really, I'd say. But time is ticking on this matter. And a similar thing can be said for Brexit. And so the European Commission Vice President, um, Šefčovič, and the UK Brexit Minister, David Frost, they're going to be meeting in Brussels later on today, as they do, to take stock of their week of intensive talks that they've had. And it's going to be focused on easing the flow of medicines between Britain and Northern Ireland, along a broader range of customs and food inspection issues. A deal on medicines, according to analysts, and it's being reported in Bloomberg, would give fresh impetus to wider talks and temper fears that the UK might imminently just end all negotiations and the retaliation effect from the EU if Article 16 is invoked. And so this isn't kind of the silver bullet. This is the deal that does the whole Northern Ireland Protocol done. It's just one thing, let's say, that then just keeps them at the table and averts the worst case scenario, is the way I'd think about it. Um, so something to be aware of. They're speaking today. Um, Frost was speaking at the House of Lords yesterday, and he did acknowledge that the European Court of Justice would continue to have a role in interpreting EU law in the region. And that's a huge contrast to the remarks he made less than a month ago. Remember, he was pretty stern, saying if the ECJ is still involved in any kind of final decisions that happen in regard to the border with Northern Ireland, um, then that's their red line. And now he's softening on that. So again, it's the usual Brexit merry-go-round. They go aggressive, they come off, they go again, they posture. It's quite frankly, it's just, it's quite tiring at this point. Um, so yeah, I don't think it's particularly meaningful as far as markets are concerned, very short-term in an intraday basis. But that's your latest. All right, for the session ahead, we've already had the UK retail sales. It's pretty quiet this morning, the whole day in fact, from a data perspective is, is pretty dull. You've got CAD retail sales this afternoon. Christine Lagarde, the ECB president, to speak this morning, talking on a speech entitled Recovery to Strength. That'll be at 8:30 and 6:00 PM. And then you've got the equity index option expiries happening throughout the day, UK, Europe, and the US as well. So just to be aware of. So final thing, don't forget, check out the podcast, please subscribe, follow, leave a rating if you like it. And, uh, yeah, new episode coming out, but hope you've had a good week and I will see you on Monday. Take care.