Pound Soars on Brexit Hopes, Bank of England in Focus

GBP

The British pound bounced-off a ten-week low against the United States dollar on better hopes of a Brexit deal. Until now, the European Union and Britain failed to reach a full Brexit deal despite holding several rounds of negotiations. However, the Times of London reported yesterday that May and Brussels reached a deal on financial services. The deal would give continued access to the UK financial services companies in the European markets after Brexit. The GBPUSD traded at a high of $1.2882 ahead of the European trading session. Market participants await the Bank of England inflation report and monetary policy decision later today.

USD

The dollar index which measures the greenback against a basket of currencies fell from a sixteen-month high as investors' risk sentiment improved. The ADP national employment report showed that the U.S. economy created 227 thousand jobs in October. The greenback got a lift from the report. However, DXY couldn't hold gains following the news from Europe as investors jumped into riskier positions. The USDJPY fell to 112.71, and the EURUSD rose to a high of $1.1366.

Equities

Wall Street finished higher for the second consecutive day, attempting to recover sizeable losses of October. The Dow Jones Industrial Average futures gained 0.7% to 25054, the S&P500 futures added 0.7% to 2706, and the Nasdaq futures climbed 1.5% to 6959. The strong corporate earnings and fewer trade tensions helped stocks to rally.

Metals

The price of a gold ounce fell to $1212, the lowest level in three weeks as the dollar traded at a sixteen-month high. However, the precious metal reversed earlier losses and rose to $1225 as the dollar softened. The silver ounce matched the same scenario and rose from a one-month low of $14.21 to trade at a high of $14.45.

Oil

Oil prices dived to a ten-week low on oversupply concerns. OPEC reported that its oil production jumped in October to the highest level since 2016. Moreover, the Energy Information Administration stated that the weekly US crude oil inventories rose by 3.217 million barrels last week. The West Texas Intermediate crude futures fell to a low of $64.77, and the Brent futures traded at a low of $74.34.

Major Economic Events

 
Disclaimer
The prices and news mentioned in this outlook are absolutely no guarantee of future market performance and do not represent the view of ICM.COM. Financial markets can move in either direction causing profits to be made or complete losses to be incurred by the trader. Each trader must decide for themselves what their risk appetite is and ensure that correct risk management procedures are in place before placing any trades.