Macro Roundup (Oct 18)

SHANGHAI, Oct 18 (SMM) — This is a roundup of global macroeconomic news last Friday and what is expected today.

The dollar headed for its first weekly decline versus major peers since the start of last month, falling back from a one-year high as traders turned their attention to when the U.S. Federal Reserve will start raising interest rates.

The dollar index, which measures the greenback against six rivals, was little changed at 94.034 on Friday. It is on track for about a 0.1% decline this week despite hitting the highest since Sept. 25 of last year at 94.563 on Tuesday.

Improved market sentiment, which has lifted global stocks, commodity prices and bond yields, is also weighing on the safe-haven dollar.

Only against the yen — another safe haven — has the dollar managed to maintain the momentum of the past five weeks, rising 0.16% on Friday and touching 113.885 yen for the first time since December of 2018.

US stock index futures were about unchanged during overnight trading on Sunday, after the major averages posted their best week in months amid a stronger-than-expected start to earnings season.

Futures contracts tied to the Dow Jones Industrial Average shed just 23 points. S&P 500 futures lost 0.1%, while Nasdaq 100 futures lost 0.2%.

The major averages are coming off a winning week. The Dow advanced 382 points on Friday, ending the week with a 1.58% gain for its best week since June. The S&P 500 rose 1.82% last week for its best week since July, while the Nasdaq Composite saw its best week since the end of August, with the tech-heavy index adding 2.18%.

In addition to better-than-expected earnings from Goldman Sachs on Friday, positive economic data also boosted stocks. Retail sales rose 0.7% in September, the Census Bureau said Friday, while economists surveyed by Dow Jones were expecting a decline of 0.2%.

Oil prices jumped to a three-year high above $85 a barrel on Friday, boosted by forecasts of a supply deficit in the next few months as the easing of coronavirus-related travel restrictions spurs demand.

Brent crude futures advanced 1% to settle at $84.86 per barrel. Front-month prices, which touched their highest level since October 2018 at $85.10, were headed for a weekly rise of 3%, which would be their sixth straight weekly gain.

U.S. West Texas Intermediate (WTI) crude futures settled 97 cents, or 1.2%, higher at $82.28 per barrel. The contract is heading for a 3.5% gain on the week, putting it on track for an eighth consecutive weekly rise.

Gold was set on Friday for its best week in more than five months as a retreat in the U.S. dollar and Treasury yields lifted the metal’s appeal despite a looming Federal Reserve taper.

Spot gold held steady at $1,794.09 per ounce by 0115 GMT but was up 2.1% for the week so far. On Thursday, prices hit a one-month high of $1,800.12.

U.S. gold futures inched down 0.1% to $1,795.50.

European stocks closed higher on Friday as corporate earnings drove global markets north to close out the week.

The pan-European Stoxx 600 closed up 0.7%, with banks adding 1.7% to lead gains while media stocks dropped 0.4%.