S&P500

The US market is in doubt. The dollar continues to rise.

On Thursday US indices were mixed. The Dow fell 0.4%, the NASDAQ added 0.5% and the S&P500 gained 0.1%.

The dollar continued the rally that started after US inflation growth data.

Asian markets closed the trading week mixed this morning. Japan's indexes rose 1.3%, while China's indexes dropped 0.1%.

Alibaba's sales on the Singles Day holiday hit an all-time record of $84bn.

Oil shows no sign of rising after a marked fall due to rising US inflation and anticipation of Fed retaliation. Brent oil is trading at $82.30 on Thursday.

The European Commission believes that exchange prices for gas in Europe will fall to $600. However, this will happen only by spring, after the heating season is over.

The infection rate is slowly decreasing. There are 500-550K new global cases per day. In the US, the infection rate is usually lower on the weekends, +43K new cases. Germany reported +50K new infections.

The S&P 500 is trading at 4,649. It remains in the range of 4,620-4,680.

The media discusses Biden's $2 trillion spending plan and its prospects. After a record level of inflation in the US in October, Republicans accuse Democrats that their new plan will push it even higher. The Democrats believe that increasing social spending will help the poorest. However, high inflation acts against Biden's and the Democrats' plans.

The property market boom in the US has not stopped. Experts say that houses on the secondary market in the US are now selling out within a week. The surge in demand for houses in the US, on the one hand, is caused by a significant increase in disposable income among wealthy Americans after several years of rapid economic growth and low interest rates. On the other hand, many Americans are looking to move from large cities to small towns amid a massive shift of many businesses to remote working for employees.

Elon Musk has sold 4.5m Tesla shares worth $5bn in recent days. However, experts believe that Musk will have to sell up to 12.5 million shares to achieve his plans. Tesla shareholders need to take this fact into account.

The consumer sentiment index from the University of Michigan is expected to be 72.

The US dollar index is trading at 95.15. It is likely to remain in the range of 94.80-95.30. The dollar has been rising for a second day. It is at its highest levels since July 2020. The reason is high US inflation and the markets' legitimate expectation that the Fed will not be able to ignore it for long. However, inflation is not reacting in any way to Fed chief Powell's remarks. It should be noted that for a highly developed economy, high inflation and high interest rates create a severe constraint on GDP growth because many investment projects become unprofitable at this cost of credit. Meanwhile, the share of long-term investment projects in a developed economy is high.

The USD/CAD pair is trading at 1.2580. It is likely to stay in the range of 1.2500 - 1.2640. The growth of the dollar has completely reversed the pair to the upside. A rally is now even more likely, but locally a corrective pullback is required before a new rise.

The market is watching US investor sentiment after the weekend. A new wave of declines is possible.