Market Commentary – November 17, 2021

Kevin Jock

17th November 2021

U.S. stocks closed higher on Tuesday as earnings from Home Depot and retail sales data signaled solid consumer health and eased worries about a Fed that may have to become more aggressive in the face of rising inflation. The Dow, Nasdaq and S&P 500 indices rose 0.15%, 0.76% and 0.39% respectively. JPMorgan sued Tesla for $162.2 million over a breach of contract related to stock warrants.

European stock indices extended their record rally on Tuesday, boosted by shares of Dutch technology investor Prosus and French luxury group Kering and lifted by optimism over easing in U.S. – China tensions, with key meeting between U.S. President Joe Biden and Chinese leader Xi Jingping that was viewed as evidence of improvement in the fraught relationship. Both CAC 40 and Dax indices ascended to new peaks.

Elsewhere in Asia, Japanese shares reversed early gains on Wednesday as concerns over rising costs and a weaker yen outweighed gains made by technology heavyweights after a strong finish on Wall Street. The Nikkei 225 index dropped 0.45% to 29,674.74 before the mid-day close. Meanwhile, Shanghai stocks rose slightly on Wednesday, led by non-ferrous metal stocks and high-end equipment manufacturers, while tech giants slipped in HK ahead of third-quarter earnings reports.

Price of Brent crude closed slightly higher at $82.623 per barrel in yesterday, while Bitcoin price extended decline below the $60K support against the US Dollar, currently trading at round $59.6K. The dollar index rose 0.5% on Tuesday, pushing most other currencies globally lower, with Turkish lira being the worst performing emerging market currency as it fell to an all-time low of 10.44 lira to the dollar.


Figure 1 (Source: IS Prime) USDTRY Daily : Turkish lira extends losses, falling 28% for the year as recent rate cuts depict a central bank unwilling to defy President Erdogen’s authority and in turn inflation.

Headliner to Review

  • The US has produced another solid retail sales report with spending increasing 1.7% month-on-month in October versus the consensus forecast of 1.3%, indicating Americans have begun holiday shopping early in an effort to avoid a shortage of goods amid stretched supply chains.
  • The US October industrial production release has beaten expectations by a decent margin. Output rose 1.6% month-on-month versus the 0.9% consensus with all of the key components posting sizable gains.

Headliner to Watch

  • US unemployment claims figure is due to release on Thursday, expected to be 260K compared to 267K from the previous week.
  • Quarterly inflation expectations in New Zealand is expected to release on Thursday as well, with the previous quarter of an increase of 2.27%

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Antony Tan
Kerry Man