European Economic Area Council meeting; ECB accounts of last
monetary policy discussions; Germany business climate index;
Deutsche Bundesbank financial stability review; France monthly
business survey; trading updates from Remy Cointreau, Kingfisher,
Shares may be mixed in Europe as the release of FOMC minutes
showed most officials favored slowing interest-rate increases soon,
and as eurozone PMI data pointed to a mild contraction. In Asia,
stock benchmarks were mostly higher; Treasury yields and the dollar
retreated; oil slipped and gold gained.
European stocks may open mixed on Thursday after Fed minutes
showed officials expect a slower pace of rate hikes ahead, and as a
key measure of eurozone manufacturing and services activity
indicated that the region's economy remained in contraction.
Investors are also keeping an eye on rising Covid-19 cases in
China and digesting U.S. economic data showing business conditions
are deteriorating, suggesting slower economic growth.
However, investor sentiment looks to be improving despite
"The FOMC has been keen to stress that the fight against
inflation is not over yet and we expect rate rises to continue well
into 2023, but the slowing of the pace of the hikes will add fuel
to increasing market excitement," said deVere Group.
The Federal Reserve meets next on Dec. 13 and 14. Traders widely
expect a 50-basis-point hike at the next meeting, with some betting
on a 24% chance of a 75 basis points hike, according to CME Group's
U.S. stock exchanges will be closed for Thanksgiving Day on
Thursday and will reopen on Friday for an abbreviated session.
The dollar weakened in Asia, but may strengthen on the minutes
of the FOMC's latest meeting, analysts said.
There are perceptions of a more dovish-leaning FOMC, said MUFG
Bank, noting that Fed officials supported the need to moderate the
pace of rate increases.
"The FOMC seems set on hiking by 50bps in December, but 2023 is
more uncertain. Though the committee seems likely to raise the 2023
dots in the December SEP, any color on the distribution of
participants' preferences in the minutes could help clarify next
year's policy path," Goldman Sachs said.
Meanwhile, the euro looks set to rise gradually against the
dollar as the European Central Bank is likely to pivot on its
policy tightening later than the Federal Reserve, Societe Generale
"The Federal Reserve began tightening monetary policy earlier
than the ECB and should stop before the ECB (the latter still has
to announce details of its quantitative tightening)," SocGen
Following the euro's recent rally there could be a pause but it
should rise closer to fair value, based on purchasing power parity,
over the longer term, it added.
Bond yields took a hit, as investors parsed the Fed's November
meeting minutes and as global economic growth concerns reverberated
ahead of the Thanksgiving Day holiday.
"It's Thanksgiving Eve and the Treasury market has edged toward
an ever-deepening curve inversion with 2s/10s slipping below -79 bp
overnight. The path toward -100 bp has become increasingly easy to
envision," said BMO Capital Markets.
Bond markets are closed Thursday and have an abbreviated session
Oil edged lower in Asia, weighed by the EU's talks about a
Russian oil-price cap.
These discussions have placed pressure on the oil market with
the suggested level higher than many were expecting, ING said,
noting reports that the price cap may be set as high as
This is above previous reports of around $60/bbl, and around the
levels that Russia was already receiving, ING said. Talks in the EU
are slated to continue Thursday, it added.
"The higher the price cap, the easier it will be for buyers in
India and China to access shipping, insurance and other services
from Group of Seven nations," said Mizuho, stressing that this is
the intent of the G-7 intervention.
Oil remains rangebound "between $78 and $93 (on a closing basis)
with Russia's response to the European Union and G-7 policies a
bullish wild card to watch in early December," said Sevens Report
"Russia may just cut exports and store oil causing a potential
bullish supply-side shock to the market," it said.
"The next two weeks in the oil markets are unlikely to be
Gold edged higher, although gains may be short-lived, analysts
There appear to be signs of buying fatigue from commodity
trading advisors, said TD Securities.
The recent rally in gold prices seems to have spurred long
positions by discretionary money managers, which adds vulnerability
to a consolidation lower in prices, it added.
"Gold appears to have established a range over the last week or
so, with the upper end falling around $1,780 -- a major area of
support in the first half of the year -- and the lower around
$1,730 -- a major barrier of resistance in September and October,"
"The FOMC minutes may determine which of these levels gives way
first and whether gold can build on its recovery rally this month
after such a long period of declines," it said.
Copper was higher in Asia amid signs of resilient demand in
developed markets, ANZ said.
Mining company Codelco has indicated it is set to cut shipments
of refined copper to China by 10%, mostly due to demand in North
America and Europe, while global commodities trader Trafigura said
the two regions are becoming bigger drivers of metal demand as
usage is boosted by the energy transition, ANZ added.
Chinese iron-ore futures rose, buoyed by the latest support for
the property sector.
Several state-owned banks in China said they would provide
billions of funding support to some private developers, according
to state-owned newspaper Securities Times.
Financial regulators have also officially introduced a package
of supportive measures that markets had been expecting, and further
stimulus may be announced at the Central Economic Work Conference
in December, Donghai Futures said.
TODAY'S TOP HEADLINES
EU Fails to Reach Agreement on G-7's Price Cap for Russian
European diplomats clashed over the price to cap Russian global
oil sales on Wednesday as the bloc failed to reach agreement on a
Group of Seven nations mechanism intended to crimp Russian oil
Diplomats involved in and briefed on discussions said they
expected the 27-nation bloc to sign off on the price cap eventually
as they race to put the system in place by Dec. 5, when both the
cap and a European Union oil embargo would enter force. Discussions
are expected to continue on Thursday.
Fed Minutes Show Most Officials Favored Slowing Rate Rises
WASHINGTON-Most Federal Reserve officials thought they should
slow the pace of interest-rate increases after approving a
0.75-percentage-point rate rise at their meeting earlier this month
to battle high inflation.
Pro Take: Crypto Firms' Empty Pledge to Remake Finance
Cryptocurrency flows through a largely unregulated financial
system every day and the industry answers to no governmental
authority. These upstarts pride themselves on sticking it to the
established financial system. And yet, some of the most celebrated
crypto executives have revealed themselves to be far worse
guardians of capital than their traditional counterparts.
FTX, along with other crypto platforms, touted itself as a
better option than traditional banks and brokerages all with little
to no internal or regulatory oversight.
Gucci's Creative Chief to Step Down
Alessandro Michele, whose eccentric designs reinvigorated Gucci,
is stepping down as creative director of the Italian luxury brand
as a period of rapid growth peters out.
Parent company Kering SA said in a statement late Wednesday that
Mr. Michele was leaving his post at the fashion house having
"played a fundamental part in making the brand what it is
Hackers Temporarily Take Down European Parliament Website
The European Parliament's website was briefly disabled by a
denial-of-service cyberattack on Wednesday, hours after lawmakers
passed a resolution labeling Russia a state that sponsors
European Parliament President Roberta Metsola tweeted that the
institution was "under a sophisticated cyberattack. A pro-Kremlin
group has claimed responsibility."
Amazon Can't Get Peloton Back in the Black
Even the Everything Store can only do so much.
When it comes to Peloton, Amazon can definitely be of some help.
The e-commerce giant started selling Peloton's basic stationary
bike in late August, one month before the end of the equipment
company's fiscal first quarter.
FTX Hires Ex-Regulators to Investigate Firm's Collapse
Cryptocurrency exchange FTX, whose recent collapse has led to
questions about lacking regulatory oversight, has hired a fitting
team to help untangle the mess: former senior U.S. regulators.
In its first hearing in Delaware bankruptcy court on Tuesday, a
lawyer representing FTX said the firm has hired former enforcement
chiefs from the U.S. Securities and Exchange Commission and the
Commodity Futures Trading Commission, now both partners at law firm
Sullivan & Cromwell LLP, to help the company's new chief
executive investigate what went wrong.
Write to firstname.lastname@example.org
Expected Major Events for Thursday
06:00/FIN: Oct PPI
07:00/NOR: 3Q Labour Cost Index - preliminary figures
07:00/EU: Oct New Commercial Vehicle Registrations in Europe
statistics (EU27 + EFTA3)
07:00/NOR: Sep Labour force survey SA, incl unemployment
07:45/FRA: Nov Monthly business survey (goods-producing
08:00/CZE: Nov Business cycle survey (consumer/business
08:30/SWE: Swedish repo rate announcement
09:00/GER: Nov Ifo Business Climate Index
09:00/ICE: Oct Labour Force Survey
11:00/TUR: Turkish interest rate decision
11:00/UK: Nov CBI Industrial Trends Survey
11:00/IRL: 3Q Labour Force Survey
13:00/POL: Oct Broad money M3
14:00/BEL: Nov Business Confidence Survey
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(END) Dow Jones Newswires
November 24, 2022 00:17 ET (05:17 GMT)
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