The upside in the US equity market was greeted with the start of the week, a surprise meeting between the US President, Treasury Secretary and Fed Chair was held on Monday. There was little detail given about the meeting, many speculated that the Phase 1 deal was the center of attention. Developments outside the scope of the trade deal added to the complexity after the US Congress overwhelmingly passed the Hong Kong Human Rights and Democracy Act.

There was midweek news about the Trade deal and that pertaining to the future of Hong Kong support. The mystery of whether Trump was going to sign the deal or loomed throughout the week, as now Hong Kong’s support was tied into the potential Phase 1 deal. Dramatic testimony in the House impeachment inquiry overshadowed reports of progress being made Trump’s other pending trade deal, the USMCA.

The trade deal was not the only large impact event that was discussed this week, but the FOMC meeting minutes from October we’re also announced. Rates are to remain on hold through the end of the year unless there is a cataclysmic change to the economic outlook which would call for another cut. Data outside of the US continued to diminish while US manufacturing data held its ground pretty well.  Treasury yields drifted lower through the week, extending a recent trend, which included a flattening along the US curve.

Crude oil had quite the weak, starting on a bearish bias, and then ending on a surprisingly high note after a cataclysmic drop mid-week. The price of WTI managed to move above the 50-day moving average for the first time since September. According to multiple reports OPEC+ produces are unlikely to deepen output cuts when they meet in early December, but the coordinated production levels are expected to be extended for another 6-months.

Here is a look at last week’s stock market on a daily basis (red vertical lines split days).

Stock Market and Sector Overview

Here is a break down of the weekly performance in various stock market sectors (top chart):

  • Energy  +0.54%
  • Technology  -0.54%
  • Financials  +0.67%
  • Retail  -2.14%
  • Utilities  -0.13%

Overview of key markets last week (bottom chart):

  • Crude  +0.28%
  • S&P500  -0.21%
  • Silver  +0.27%
  • Gold -0.35%
  • US dollar +0.28%

Weekly Economic Calendar

Very little high impact economic news in the coming week after all the China/US tape bombs and the FOMC this past week. Now that we are coming into the end of the year we’re getting into the thick of the potential US-China trade deal.
Monday, No high impact news.
Tuesday, RBA Gov Lowe speaks and construction work done q/q out of Australia, CB Consumer Confidence out of the US, then RBNZ Gov Orr speaks out of New Zealand.
Wednesday, Chicago PMI out of the US, New Zealand ANZ Business confidence, Australia Private capital expenditure.
Thursday, no high impact news.
Friday, Canadian GDP and Chinese Manufacturing PMI.

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