The AUD is the strongest and the CAD is the weakest as the NA session begins

As the North American session begins, the AUD is the strongest and the CAD is the weakest. The ECB will announce its rate decision at 8:15 AM ET, with the expectation for a 25 basis point decline

• ECB expected to lower deposit rate by 25 basis points from 3.50% to 3.25%, with markets pricing nearly a 100% chance of this outcome.
• The sentiment has swayed to a cut after the ECB pattern was to cut in June, no cut in July and cut in Septembers .
• September PMI data was much worse than expected which started the sway.
• Inflation for September contributed to this dovish outlook with the headline falling to 1.8% from 2.2% and the core falling to 2.7% from 2.8% .
• A number of ECB members have hinted at the cut

ECBs Lagarde will start her scheduled press conference at 8:45 AM ET. Markets will be focused on hints of schedule – if any – for futher cuts ahead.

In addition to the ECB rate decision, there are a number of economic releases and events that will be a focus for the markets today:

8:30am

• Core Retail Sales m/m: Forecast 0.1%, Previous 0.1%
• Retail Sales m/m: Forecast 0.3%, Previous 0.1%
• Unemployment Claims: Actual 260K, Forecast 241K, Previous 258K. The hurricanes could be an influence in this number.
• Philly Fed Manufacturing Index: Forecast 4.2, Previous 1.7

9:15am

• Capacity Utilization Rate: Forecast 77.9%, Previous 78.0%
• Industrial Production m/m: Forecast -0.1%, Previous 0.8%

10:00am

• US Business Inventories m/m: Forecast 0.3%, Previous 0.4%
• NAHB Housing Market Index: Actual 43, Forecast 43, Previous 41

• 10:30am

  • Natural Gas Storage: Forecast 80B, Previous 82B

11:00am

• Crude Oil Inventories: Forecast 1.8M, Previous 5.8M. Gasoline est -1.47M vs -6.30M last week. Distillates est -2.181M vs -3.124M last week

The private data released late yesterday showed:

11:00 AM

• FOMC Member Goolsbee Speaks

Tentative:

• Treasury Sec Yellen Speaks

2:00 PM

• Federal Budget Balance: Actual 4.5B, Previous -380.1B

4:00pm

• TIC Long-Term Purchases: Previous 135.4B

The US stocks are sharply higher in premarket trading, with the Nasdaq leading the way after TSMC earning smashed expectations:

• .Net profit: T$325.26 billion ($10.1 billion), higher than Reuters’ estimate of T$300.2 billion.
• Revenue: T$759.69 billion, up 39% year-over-year.
• Q4 revenue forecast: Between $26.1 billion and $26.9 billion with a gross margin of 57% to 59%.
• Annual revenue expected to grow around 30%.

Shares of TSM in the US are trading up 9.51% in premarket trading.

• Nvidia shares are up 3.10%.
• SMCI are up 3.34%.
• AMD shares are up 2.68%
• Broadcom shares are up 2.86%

The other earnings releases this morning showed:

• Blackstone Inc (BX) Q3 2024: EPS 1.01 (exp. 0.91) → BEAT, AUM 1.11tn (exp. 1.11tn) → MET
• Travelers Companies Inc (TRV) Q3 2024: EPS 5.24 (exp. 3.70) → BEAT, Revenue 11.9bn (exp. 11.45bn) → BEAT
• KeyCorp (KEY) Q3 2024: adj. EPS 0.30 (exp. 0.30) → MET, Revenue 0.695bn (exp. 1.27bn) → MISSED
• Marsh & McLennan Companies Inc (MMC) Q3 2024: adj. EPS 1.63 (exp. 1.62) → BEAT, Revenue 5.69bn (exp. 5.7bn) → MET
• Truist Financial Corp (TFC) Q3 2024: EPS 0.97 (exp. 0.91) → BEAT, Revenue 5.14bn (exp. 5.09bn) → BEAT

A snapshot of the other markets as the North American session begins shows:

• Crude oil is trading unchanged at $70.39. At this time yesterday, the price was at $70.16
• Gold is trading up $7.22 or 0.27% at $2680.93.. At this time yesterday, the price was $2680.00
• Silver is trading up nine cents or 0.27% at $71.75. At this time yesterday, the price is at $31.88
• Bitcoin is trading higher at $66,909. At this time yesterday, the price was at $68,030
• Ethereum is trading at $2600.90. At this time yesterday, the price was at $2638

In the premarket, the snapshot of the major indices are showing the Dow industrial average little changed with a gain of 18.3 points. The NASDAQ index is the beginner with a premarket gain of 174 points

• Dow Industrial Average futures are implying gain of 18.30 points. Yesterday, the index rose 337.28 points or 0.79% at 43077.70
• S&P futures are implying a gain of 23.02 points points. Yesterday, the index rose to 27.21 points or 0.47% at 5842.47.
• Nasdaq futures are implying a gain of 174 points. Yesterday, the index rose 51.49 points or 0.28% at 18367.08

Yesterday, the small-cap Russell 2000 rose sharply by 36.85 points or 1.64% at 2286.67

European stock indices are trading mostly higher:

• German DAX, +0.59%
• France CAC, +1.13%
• UK FTSE 100, +0.34%
• Spain’s Ibex, -0.15%
• Italy’s FTSE MIB, +0.99% (delayed by 10 minutes)

Shares in Asian Pacific session shares were mostly lower:

• Japan’s Nikkei 225, -0.69%
• China’s Shanghai Composite Index, -1.05%
• Hong Kong’s Hang Seng index, -1.02%
• Australia S&P/ASX index, +0.86%

Looking at the US debt market, yields are trading modestly higher

• 2-year yield 3.946%, +1.2 basis points. At this time yesterday, the yield was at 3.95%
• 5-year yield 3.856%, +1.4 basis points. At this time yesterday, the yield was at 3.828%
• 10-year yield 4.031%, +1.8 basis points. At this time yesterday, the yield was at 4.006%
• 30-year yield 4.317%, +1.8 basis points. At this time yesterday, the yield was at 4.294%

Looking at the treasury yield curve close steeper on Friday. At the close

• The 2-10 year spread is at +8.7 basis points. At this time Friday morning, the yield spread was +8.3 basis points.
• The 2-30 year spread is at +37.2 basis points. At this time Friday morning, the yield spread was +37.0 basis points.

The benchmark 10 year yields are modestly higher ahead of the ECB rate decision:

This article was written by Greg Michalowski at www.forexlive.com.