Weekly Outlook of Financial Markets for December 23-27

During last week, the markets moved in high gear as the anticipated FOMC meeting concluded with a mini-tapering of $10 billion so that next month’s QE3 will only be of $75 billion LTS and MBS. Moreover, the FOMC also assured the markets that it will maintain the low interest rates until the end of 2015. This news had some adverse effect on gold and silver. The US dollar also reacted and rallied against leading currencies including Euro and Aussie dollar. This week, however, the Christmas holiday is likely to keep the volume of trade very low; this in turn, could result in high volatility or very low volatility in the financial markets especially in commodities. In the upcoming week several reports may affect the markets; these include: U.S new home sales, BOJ minutes of last meeting, U.S durable goods, Canada’s GDP, U.S jobless claims, U.S consumer confidence, and EIA oil and natural gas weekly reports. Here is a breakdown for the week of December 23rd to December 27th referring to the U.S, Japan, and Canada.  

(All times GMT):

Monday, December 23rd

13:30 – Canada’s GDP by Industry: This monthly report presents the developments in major industrial sectors for October 2013. In the last update regarding September 2013, the real gross domestic product inched up by 0.3%. This report may affect the Canadian dollar, which is strongly correlated with commodities prices such as oil and gold;

13:30 – U.S Personal spending: This monthly report will refer to the changes in income and outlays in the U.S during November; in the last report regarding October the personal income slightly rose by 0.3%;

14:55 – UoM Consumer Sentiment (revised):University of Michigan will release its revised consumer sentiment monthly report; this survey could provide information regarding the changes in U.S consumers’ sentiment; according to the recent report, the sentiment index rose to 75.1;

Tuesday, December 24th

13:30 – U.S Core Durable Goods: This monthly report regarding November may indirectly indicate the changes in U.S. demand for commodities such as oil and gas. As of October 2013, new orders of manufactured durable goods fell to $486.9 billion; if this report shows another drop in new orders, then it could drag down not only the USD but also commodities;

15:00 – U.S. New Home Sales: This report will refer to November 2013; in the last report (opens pdf; for October), the sales of new homes sharply rose to an annual rate of 444,000 – a 25.4% rise (month-over-month); if the number of home sales keep increasing, this may suggest the housing market in the U.S is reheating; this news may also affect the US dollar;

Wednesday, December 25th

00:50 – Minutes of Bank of Japan’s Monetary Policy Meeting: Bank of Japan kept this month its monetary policy unchanged. The minutes may offer some insight regarding the bank’s future plans; this news may affect the Japanese yen and consequently commodities prices;

Thursday, December 26th

13:30 – U.S. Jobless Claims Weekly update:  This weekly report will pertain to the changes in the initial jobless claims for the week ending on December 22nd; in the previous report the jobless claims increased by 10k to reach 379k; this next weekly report may affect the U.S dollar and consequently commodities and stocks markets;

Friday, December 27th

15:30 – U.S Crude Oil Stockpiles Weekly report: The EIA (Energy Information Administration) will release its weekly report on the U.S oil and petroleum stockpiles for the week ending on December 22nd; the report will also show the changes in imports, refinery input and production, which could provide some insight behind the latest shifts in the price of crude oil in the U.S; 

15:30 – EIA U.S. Natural Gas Storage Update: The EIA weekly report refers to the U.S. natural gas market; the report presents the latest developments in natural gas production, storage, consumption and rates as of December 22nd;

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