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03.12.202109:09 Forex Analysis & Reviews: US stock market on December 3, 2021

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Exchange Rates 03.12.2021 analysis

S&P500

The US market demonstrated a strong upward rebound. The fall has been halted.

The main indices showed strong gains on Thursday. The rebound upwards almost completely compensated for Wednesday's market decline. By Thursday's close, the Dow rose 1.8%, the NASDAQ gained 0.8%, and the S&P500 added 1.4%.

Asian stock markets were also up on Friday morning. Japanese indices were up 0.9%, and Chinese indices added 0.7%.

Oil showed a strong upward reversal yesterday. Brent closed at $70.50 on Friday. OPEC+ had a scheduled meeting and decided to increase production in January by the previously planned 400k bpd. This is clearly not enough to reduce the supply deficit in the oil market. The next OPEC meeting is scheduled for early January.

The number of coronavirus cases worldwide keeps rising. On Thursday, there were 694,000 new cases around the world. In the US, there were 133,000 cases. The UK saw an increase of 54,000. Germany and France reported +73K and +48K new infections respectively.

The S&P 500 is trading at 4,577. It remains in the range of 4,550-4,600.

Biden announced his intent to nominate Jerome Powell for a second term as Chair of the Board of Governors of the Federal Reserve System. Apparently, Powell's policy of being as soft as possible on high inflation suits the US administration. Congress and the Senate were able to quickly pass a bill to raise the US national debt limit. There is now a debate in Congress over vaccination regulations. Anti-vaccination sentiment is known to be strong among Republicans in some states. It is in these states that infection rates are higher.

The weekly US jobs report was rather strong. Initial jobless claims rose by 222K for the week. The number of long-term unemployed fell below 2 million, i.e. by around 100K for the week.

The employment report for November will be released today. The number of jobs is expected to increase by 500K. Later in the day there will be a service sector activity report for November.

Five cases of the new Omicron strain have been detected in New York. Biden has announced a new plan to fight the epidemic. So far, it's just a vaccination and testing effort. The government does not plan to impose a lockdown.

Joe Biden on Thursday said he would prevent China from passing the United States to become the most powerful country in the world. In particular, the US plans to fight China's use of modern technology to tighten control over its citizens. The government will tighten export requirements for the latest electronic devices.

USDX is at 96.15, trading in the 95.80–96.30 range. The decision to raise the US government debt limit has relieved pressure on the dollar. Market awaits new data on COVID-19 situation amid new strain.

USDCAD is trading at 1.2810 in the 1.2750–1.2840 range. The pair is expected to decline on the back of rising oil prices. The upward trend continues. However, there is a possibility of a correction.

The US market has formed a range. There are upper and lower limits.

Jozef Kovach
analytik InstaForexu
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