Focus on US NFP, French and South Korea Developments
All eyes today are on the French and South Korean markets as both countries face political instability. South Korea’s Kospi index dropped 1.44% on Wednesday while the Bank of Korea said it would deploy measures to stabilize the forex market. In France, the CAC 40 surged by 0.45% as French lawmakers will hold a vote of no-confidence in the minority government later today.
In other news, economists will be waiting for the US Nonfarm Payrolls report due on Friday as the set of data will likely play a role in the upcoming Federal Reserve interest rate decision.
US job openings surged in October while layoffs dropped by the most in the last one and half years according to the latest Job Openings and Labor Turnover Survey (JOLTS). The report suggested that the jobs market continued to slow in an orderly fashion. However, analysts noted that employers also hesitated to hire more employees. Job openings rose by 372,000 to 7.744 million in October while a Reuters forecast had suggested a number close to 7.475 million vacancies.
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Australian GDP In Q3 Misses Estimates
The Australian Bureau of Statistics (ABS) published a report showing that the economy expanded by 0.3% in the third quarter of the year and by 0.8% on a year-to-year basis. Both figures were lower than expected. The third quarter of 2024 is the twelfth quarter in a row that GDP growth has been recorded.
Commenting on the GDP report, Treasurer Jim Chalmers said that “today's national accounts show positive but weak GDP growth. People are under pressure but it's encouraging to see growth in real disposable incomes.” Chalmers also noted that “we’d rather be part of a soft landing in our economy than [having] to clean up after a hard one.”
US Nonfarm Payrolls November 2024
On Friday, all eyes will be on the US Nonfarm Payrolls (NFP) report released by the Bureau of Labour Statistics (BLS) for the month of November. The consensus among economists sees 200,000 jobs added to the US economy in November, a significant jump when compared to October’s report.
The October report showed that only 12,000 jobs were created, influenced by severe weather disruptions in southern states as well as strikes. With the Federal Reserve’s Federal Open Market Committee (FOMC) preparing for its last meeting of the year on December 17-18th, the NFP report is expected to play a role on whether we might see a new interest rate cut or not.
OPEC+ To Extend Production Cuts?
Reuters sources suggested that OPEC+ considers extending its oil production cuts in 2025, and more specifically up until the first quarter of the year. OPEC+ members produce more than half of the total global oil output.
UBS analysts told Reuters that “renewed tensions in Lebanon, together with market participants pricing in a three-month extension of OPEC+ production cuts, is lifting prices.” Speaking to Rigzone, commodities analysts at Skandinaviska Enskilda Banken AB (SEB), said: “Market participants and traders widely anticipate that the cartel will maintain its wait and see approach to avoid worsening the fragile market balance. We believe OPEC+ is acutely aware of the risks associated with oversupplying the market and will likely act to stabilize prices rather than jeopardize them.”
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