Today’s Key Market Drivers: 5th November 2018

“Strong US Wages Growth Supports the US Dollar.”

Financial markets this week will likely kick off to the downside following a weak lead from Wall Street on Friday after US 10 Year Treasury Yields rose once again to 3.2% after wages growth in the USA rose by 3.1% in the past 12 months and 250,000 jobs were created in the month of October. Traders immediately saw the higher than expected annual wages growth number as another reason for the US Federal Reserve to continue to raise interest rates. The Fed meets this Wednesday and Thursday and is expected to leave the cash rate on hold this month but traders are anticipating a rate hike in the month of December. It would be a big surprise to the market if the Fed raised the official cash rate this week given traders are pricing in an 80% chance or better that they will hike rates in December. The US stock market was all green on Friday morning before the wages and jobs number and the minute the data was released and the 10 Year Yield spiked higher traders began to sell down stocks again and move money into fixed income which drove up the value of the US Dollar. After falling against all of its major rivals for Wednesday and Thursday the greenback rallied strongly into the close of platforms on Saturday morning and I suspect this trend will continue today.

There are four pieces of high impacting economic data that is set to drive financial markets this week with the US Mid Term Election Results and the US Fed’s statement likely to be the standouts. The RBA releases its November statement Tuesday and the RBNZ Thursday and neither are expected to adjust monetary policy in November. The US Mid Term Election Results may give us a gauge whether or not Trump is going to be a “one-term” or “two-term” President and I suspect increased volatility could last for a couple of days if there are any surprises. As mentioned above the Fed isn’t expected to raise rates this month but it won’t be able to ignore and not comment on the stellar performance of the US economy and in particular the strong annual wages growth numbers from last week. My expectation is the Fed’s statement could be the tipping point for stock indexes to make the next big move lower again and take out the lows created less than a week ago.

If you missed last Friday’s podcast of Friday Live here is the link to watch the recording.

Today marked the first day of Sunrise Live with AB and Rosie. We had around 40 GoldRockers up early and logged in to my TrainwithAndrew Facebook Live feed for a gorgeous Live view of Sunrise in my backyard at Castaways Beach. During Sunrise this morning we started a willpower and discipline challenge which will be the focus this week. The daily Sunrise video link that is below is now only a video of the daily Sunrise and doesn’t come with my daily commentary, which is reserved for those who are Live with me or watch the posted Sunrise Live video afterwards on TrainwithAndrew. You can watch today’s Sunrise Live by logging onto Facebook and searching for @trainwithABnow

Any trade updates throughout the day will be sent via Trade Time. You can also follow my daily updates on Facebook, Twitter, Instagram by searching for TrainwithAndrew. Make sure you subscribe to the Andrew Barnett YouTube channel after watching today’s Sunrise video below.

Click on the below image to play today’s Sunrise video.


About the Author: Andrew Barnett

Andrew is a professional trader and successful investor who has a strong focus on education. He is a regular Sky News Money Channel Guest and one of Australia’s most awarded and respected financial experts and is regularly contacted by the Australian Media for the latest on what is happening with the Australian Dollar. Director at LTG GoldRock, Andrew Barnett, guides thousands of traders around the world in the live market on a daily basis, advising them on buy and sell directions, as well as trading his own personal account. Andrew, a regular keynote speaker at trading and wealth-creation events throughout the Asia Pacific region, is an authorized representative registered with the Australian Securities and Investment Commission (ASIC).

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