Morning Report – Friday 6th November

Main Headlines

Joe Biden said yesterday there was “no doubt” he would be the next President of the United States. Donald Trump called for vote counting to be stopped as his lead fell in key battleground states. Trump has also launched lawsuits in Pennsylvania, Michigan, Georgia and plans to do so in Nevada.

The Federal Reserve held monetary policy steady and kept interest rates at zero with no changes to the bond buying programme. In a press conference later, Fed Chair Powell emphasised that he would keep rates low until it looks like the US have recovered from the pandemic.

The S&P 500 is on course to have its best week since April after gaining over 2% yesterday. The Nasdaq 100, which includes an abundance of tech firms is up 9% this week. Gold and Oil prices fell as it became clear that Joe Biden was on the verge of winning the presidency.

GBP

The pound is trading relatively flat against the dollar, and is lower against the euro this morning after significant gains on Thursday. Rishi Sunak will extend the furlough scheme to March to help businesses in an attempt to curtail unemployment. House price data for October is also released today.

EUR

The euro is trading higher against the dollar in a volatile morning of trading. The EU scaled back expectations on its economic recovery yesterday, and reiterated it would take at least two years for the bloc to return to pre-pandemic levels. German industrial figures rose 1.6% in September short of the expected 2.5% consensus. Spain is expected to report a fall in industrial production in September, however it should exceed expectations of -5.7%.

USD

The dollar has recanted some of its losses against a basket of major currencies this morning, after significant losses yesterday. The greenback fell to its lowest level since March 2018 against the Japanese Yen. The US reported 751,000 new jobless claims a small decline from last week, Non-farm payrolls, released today, is expected to increase by 600,000, less than the 661,000 rise seen in September. Unemployment rate is also expected to fall to 7.6%.

Main Economic Data/Central Banks/Government (All times GMT)

7:45 a.m.: France Sept. Trade Balance
8:00 a.m.: Spain Sept. Industrial Output
9:00 a.m.: Italy Sept. Retail Sales
1:30 p.m.: U.S. Oct. Jobs Report
2:15 p.m.: ECB’s Holzmann speaks
4:00 p.m.: Russia Oct. CPI
6:00 p.m.: Baker Hughes U.S. Rig Count

Poland Rate decision
Greece, Italy sovereign debt rated by Moody’s; Germany rated by Fitch