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Market News Financial Breakfast on November 22: Minutes of the Fed meeting struck, focusing on countries releasing oil reserves to suppress oil prices, and oil prices hit a record low in nearly seven weeks

Financial Breakfast on November 22: Minutes of the Fed meeting struck, focusing on countries releasing oil reserves to suppress oil prices, and oil prices hit a record low in nearly seven weeks

During the week of November 22nd to November 29th, both the Federal Reserve and the European Central Bank will release meeting minutes; in addition, after the United States urged countries to release oil reserves to curb the rise in oil prices last week, Japan revealed over the weekend that it was considering releasing oil reserves. Will pay attention to the statements of other countries, as well as the specific actions of the United States, which will be the main fundamental factor affecting oil prices this week.

TOPONE Markets Analyst
2021-11-22
9336
This week (the week of November 22-November 29), both the Federal Reserve and the European Central Bank will release meeting minutes; in addition, after the United States urged countries to release oil reserves to curb the rise in oil prices last week, Japan revealed over the weekend that it was considering releasing oil. Reserves, next will focus on the statements of other countries and the specific actions of the United States. This will be the main fundamental factor affecting oil prices this week.

In early trading on Monday (November 22), US crude oil opened lower and moved lower, falling more than 1% at one time, hitting a new low of $74.76 per barrel since October 1.



Market hotspots this week


①On Monday, the initial value of the November consumer confidence index in the Eurozone, the annualized total number of existing home sales in the United States in October, the European Central Bank Management Committee Holtzman, Kazimir and Kasachs delivered speeches.

②On Tuesday, the initial value of the Markit manufacturing PMI in November in the Eurozone, the initial value of the Markit manufacturing PMI in November in the United States, the initial value of the Markit manufacturing PMI in November in the United Kingdom, and Haskell, a member of the Bank of England, delivered speeches on the issue of high inflation.

③On Wednesday, the Federal Reserve Bank of New Zealand announced the interest rate resolution, the German November IFO business climate index, the initial monthly rate of durable goods orders in the United States, the number of people claiming unemployment benefits for the week as of November 20, and the actual annualized GDP of the United States in the third quarter. Modified quarterly rate, EIA data.

④On Thursday, New Zealand’s October trade account, Germany’s final quarterly GDP rate in the third quarter, Germany’s December Gfk consumer confidence index, the Federal Reserve’s FOMC announced the monetary policy meeting minutes, the European Central Bank announced the monetary policy meeting minutes, and the Bank of Korea announced interest rates resolution.

⑤On Friday, Japan’s November Tokyo CPI annual rate, Switzerland’s third quarter GDP annual rate, and Bank of England Governor Bailey delivered speeches.

⑥On Saturday, the annual profit rate of China's industrial enterprises above designated size in October.

Holiday reminder this week


① On Tuesday, the Tokyo Stock Exchange Labor Appreciation Day, the market is closed for one day.

② On Wednesday, the U.S. Thanksgiving holiday, the trading of CME's precious metals, U.S. crude oil and foreign exchange contracts ended ahead of schedule at 02:00 on the 25th GMT+8.

③ On Thursday, due to Thanksgiving, the trading of ICE's Brent crude oil contract ended ahead of schedule at 03:30 on the 26th GMT+8; the New York Stock Exchange was closed for one day.

④ On Friday, Thanksgiving holiday, the New York Stock Exchange closed ahead of schedule at 02:00 GMT+8 November 27; ICE’s Brent crude oil contract ended ahead of schedule at 03:00 GMT+8 27; CME’s precious metals, U.S. crude oil contract trading ended ahead of schedule at 02:45 on the 27th GMT+8; trading of its foreign exchange contracts ended ahead of schedule at 02:15 on the 27th GMT+8.

Market opening on Monday




Last week review


[Fed vice chairman and board members voiced on the same day that they may need to discuss speeding up the reduction of bond purchases] Two Fed officials said on Friday that the Fed may need to consider speeding up the reduction of bond purchases when the economy is growing strongly and inflation is rising; Richard Clarida said that I will pay close attention to the economic data released before the policy meeting in December. At the meeting, it may be appropriate to discuss a more substantial reduction in debt purchases; before that, Fed Governor Christopher Waller also stated that in the case of soaring inflation, the Fed may have to speed up the reduction of asset purchases and bring interest rates closer to The zero level is raised.

[The US House of Representatives passes the $1.9 trillion spending bill and the climate change bill] On November 19, local time, the US House of Representatives passed the Democrat-led $1.9 trillion spending bill and climate change with 220 votes in favor and 213 votes against it. bill. The results of the voting showed that all Republicans in Congress voted against, but all Democrats voted for it except one. The "Capitol Hill" pointed out that the bill still needs to be passed by the Senate before it can take effect. On the 18th, a report issued by the U.S. Congressional Budget Office showed that this bill will increase the U.S. fiscal deficit by approximately $160 billion in the next 10 years. (CCTV)

[The People's Bank of China: Continue to implement comprehensive policies and actively and steadily respond to monetary policy adjustments in developed economies] The People's Bank of China released a report on the implementation of China's monetary policy for the third quarter of 2021. The report pointed out that the current internal and external environment facing my country is significantly different from the last round, and the policy adjustments of advanced economies have limited impact on China. A good cross-cycle design of my country's monetary policy can more effectively deal with the external shocks brought about by the adjustment of monetary policy in developed economies. In the next step, we must continue to implement comprehensive policies and actively and steadily respond to monetary policy adjustments in developed economies. First, a prudent monetary policy is the priority, focusing on me, enhancing autonomy, and grasping the intensity and pace of the policy in accordance with the domestic economic situation and price trends. The second is to deepen the market-oriented reform of the RMB exchange rate, strengthen the flexibility of the RMB exchange rate, strengthen anticipation management, improve the macro-prudential management of cross-border financing, guide market entities to adhere to the concept of "risk neutrality", and maintain the basic stability of the RMB exchange rate at a reasonable and balanced level. The third is to continuously deepen the two-way opening up of finance and enhance the attractiveness of domestic RMB assets.

[Saudi crude oil exports rose for the fifth consecutive month in September] The Joint Organization Data Initiative (JODI) said on Thursday that Saudi Arabia’s September crude oil exports increased for the fifth consecutive month, reaching the highest level since January. Saudi Arabia’s crude oil exports in September increased from 6.54 million barrels per day in August to 6.516 million barrels per day. The total export volume, including petroleum products, was 7.84 million barrels per day.

List of major global markets



The US stock market fell last Friday after Fed officials made hawkish remarks. In addition, investors are also worried that a new round of epidemic in Europe may trigger more anti-epidemic lockdown measures. Energy, financial and industrial stocks and other economically sensitive industry stocks fell, and the Nasdaq 100 index, which has a relatively high technology stake, outperformed the major benchmark indexes. Although the stock market is hovering near record highs supported by strong corporate earnings, a renewed epidemic may prevent economic recovery as inflation rises.

Callie Cox, senior investment strategist at Ally Invest, said that this is a week when the stock market is once again challenging gravity under severe conditions. This road is not easy. Investors are still digesting the risk of out-of-control inflation, and at the same time facing a surge in Covid cases and a new round of restrictions in Europe.

Precious metals and crude oil


Last Friday, the price of gold fell, dragged down by the strength of the U.S. dollar, spot gold fell 0.85% to a new low since November 11 to US$1,84.12 per ounce; Fed officials said earlier that they may need to consider accelerating the pace of debt reduction due to strong economic growth. Inflation is rising.

Fed Vice Chairman Richard Clarida said that he will pay close attention to the economic data released before the policy meeting in December. At this meeting, it may be appropriate to discuss a greater reduction in debt purchases. Previously, Fed Governor Christopher Waller called for an early reduction in economic support measures to help formulate a tightening monetary policy; Waller said that the Fed should accelerate the pace of reducing the scale of debt purchases in order to leave more room for interest rate hikes;

As a result, the dollar rose, which undermined the attractiveness of gold to foreign investors. However, behind a series of contradictory views on inflation and monetary policy, the price of gold has been fluctuating within a range of less than $30 this week.

Ryan McKay, a commodity strategist at TD Securities, said that the price of gold is a bit caught up in the debate about high inflation and stagflation worries, as well as bets on the central bank's tightening policy.

Oil prices plummeted last Friday. U.S. oil once fell more than 4%, hitting a new low of US$75.09 per barrel since October 7; Burundi oil fell below US$80 per barrel. The surge in the number of new crown cases in Europe may slow down the economic recovery. At the same time, investors also We are weighing the possibility that major economies will release crude oil reserves to cool oil prices.

On the last day as a near-month contract, the December US crude oil futures contract fell US$2.91, or 3.6%, to US$76.10 per barrel. Crude oil, the two major indicators, both fell for the fourth consecutive week this week, marking the first time since March 2020.

Futures senior analyst Phil Flynn said that fear of unknown factors is weighing on market sentiment. Price is concerned that he will see some form of coordinated release of oil reserves during the Thanksgiving holiday next week, when trading volumes are usually low, so There will be big market.

However, Goldman Sachs analysts Damien Courvalin and Callum Bruce wrote in the report that due to thin trading, the decline in crude oil prices on Friday "exceeded actual fundamental risks." Reiterate the forecast of the average price of US$85/barrel in the fourth quarter. High-frequency inventory data shows that the supply and demand imbalance in the past four weeks is about 2 million barrels per day. Such a serious supply gap is actually enough to absorb the current resistance of the bullish argument for oil prices, and the decline in oil prices actually reduces the possibility of releasing strategic oil reserves. sex.

Foreign exchange


The U.S. dollar rose last Friday and investors sought safety after Austria became the first country in Western Europe to re-implement a complete blockade to contain the new crown epidemic. Germany also said that it might follow suit, causing the euro to fall. With the exception of the yen, the US dollar has strengthened against other G-10 currencies; the Norwegian Krone has performed particularly poorly.

The dollar index rose 0.50% to 96.02, close to the 16-month high of 96.26 touched on Wednesday; this week, the dollar rose 0.95%. Fed Vice Chairman Clarida said that I will pay close attention to the data before the meeting from now to December, and it may be appropriate to discuss speeding up the ongoing balance sheet reduction at this meeting.

Fed Governor Waller said earlier that if high inflation and employment growth continue, the Fed should speed up the pace of reducing the scale of bond purchases to leave more room for early interest rate hikes.

Joe Manimbo, senior market analyst at Western Union Business Solutions, said that the U.S. dollar is currently benefiting from signs of a strong US economy and the flow of safe-haven funds caused by renewed concerns about the virus.

At the same time, with the surge in infections in Europe and increased expectations that interest rate hikes in other places, especially the United States, will accelerate, the euro fell by 0.71% against the dollar to 1.1290, which had earlier touched the US$1.1250 since July 2020. lowest. This week, the euro fell more than 1% against the dollar.

The euro against the Swiss franc fell 0.75% to 1.0447, the lowest level since July 2015, due to the demand for safe-haven currencies and the decline in European yields.

The yen, which is also regarded as a safe-haven currency, strengthened after Austria announced the blockade. The dollar fell 0.24% to 113.99 against the yen. It was basically flat last week; the key support is at the November 9 low of 112.73, and options-related selling materials are expected. It encountered resistance near 115; as the euro against the yen tested the double-bottom support near 127.93, the implied volatility of the currency pair rose sharply.

As the yield on British government bonds fell, the pound fell 0.32% to 1.3451 against the dollar; but rose 0.28% this week as the euro fell against the pound; the euro fell 0.4% against the pound on Friday, only higher than the year low of 0.8383 set on Thursday.

Commodity-related currencies that are generally regarded as high-risk, such as the Australian dollar, New Zealand dollar and Canadian dollar, have all fallen. The Canadian dollar and Australian dollar hit six-week lows last Friday. The U.S. dollar rose 0.30% against the Canadian dollar to 1.2640; the Australian dollar fell 0.58% against the U.S. dollar to 0.7235; the New Zealand dollar fell 0.57% against the U.S. dollar to 0.7004.

International news


[The new head of the Federal Reserve is about to be announced The White House: more information will be announced next week] The White House said on November 19 local time that there will be more announcements about the candidate for the chairman of the Federal Reserve earlier next week. Some analysts said that the current market generally expects that the current Fed Chairman Powell will be nominated again, and if Brainard is appointed as the new Fed Chairman, the Fed's monetary policy stance will be more moderate, which means that the Fed will raise interest rates or tighten Monetary policy will take longer. (CCTV)

[France considers expanding the scope of the third dose of vaccination to respond to the fifth wave of epidemic] French officials are considering expanding the scope of the third dose of new crown vaccination on the 19th local time, in order to respond to the fifth wave of epidemics that has already arrived. French President Macron visited a medical center in Onoy-Amri in the Northern Province that day to learn about the current epidemic prevention situation. When talking about the third dose of vaccination, Macron said that the government may open the third dose of vaccination to those eligible for vaccination. (China News Network)

[Prime Minister of Japan: Discussions are underway on the release of national oil reserves] According to the Japan Jiji News Agency, Japanese Prime Minister Fumio Kishida said during an inspection in Matsuyama on November 20 that in response to the impact of high crude oil prices, the release of national oil reserves is underway. discuss. According to the Japanese Petroleum Reserve Law, the release of oil reserves is only allowed in the event of insufficient supply caused by war and natural disasters, and does not include the increase in oil prices. In addition, according to the "Asahi Shimbun" report, Japan once released oil reserves of private institutions during the Gulf War and the March 11 earthquake in Japan. So far, there has been no precedent for releasing national oil reserves. (CCTV Network)

[Former Director of the US Department of Health: New crown cases in the United States may see a surge in winter] According to a report from the US "Capitol Hill" on the 20th, former US Department of Health Director Jerome Adams predicted that the gathering of Americans for the holidays in the next few weeks may lead to There has been a "winter surge" in the new crown epidemic. Adams said in an interview that "the winter surge of new crown cases is almost inevitable, and the key lies in its severity." He believes that the American people are somewhat "optimistic" about the current situation of the new crown epidemic and warned people to strengthen epidemic prevention during the Thanksgiving holiday.

[Japan and the United States plan to release a joint statement on the release of strategic oil reserves] According to the Yomiuri Shimbun, Japan and the United States may release a joint statement on the release of oil reserves as early as this week to curb the rise in oil prices. Japanese Prime Minister Fumio Kishida told reporters the day before that the Japanese government is evaluating possible measures in order to cooperate with other countries to solve this problem. Although Japan’s oil reserve law does not allow the release of reserves because of high prices, the current reserves held by the government and the private sector exceed the minimum requirements of the law. "Yomiuri Shimbun" quoted government sources on Sunday that the government is considering releasing part of these excess reserves and believes that the sale of these excess reserves is not subject to legal restrictions.

[WHO: If emergency measures are not taken until next March, there may be 500,000 deaths from the new crown in Europe] Hans Kruger, director of the WHO Regional Office for Europe, said in an interview with the media on the 20th that according to the current new crown in Europe The development trend of the epidemic, if emergency prevention measures are not taken, by March next year, 500,000 people in Europe may die from the new crown pneumonia. Hans Kruger said that strengthening the requirements for wearing masks may have immediate results. In addition, he also mentioned the "vaccine passport" and mandatory vaccination. He believes that although the new crown vaccine is still controversial, it can still be used as a "last resort." (CCTV News)

Domestic news


[Pork prices have risen for 5 consecutive weeks, with a cumulative increase of 34.9%] Along with the upsurge of cured meats, pork prices have also ushered in a wave of price increases. According to the monitoring of the Ministry of Agriculture and Rural Affairs, in the 45th week of 2021 (November 8-November 14), the average weekly price of pork in the wholesale market was 24.02 yuan per kilogram, an increase of 3.8% from the previous month, which was a five-week increase, with a cumulative increase of 34.9%. This is 39.0% lower than the same period last year. Why did pork prices rise again? In the opinion of experts, it is mainly because the demand for pickled wax has rebounded after the weather turned cold. Coupled with the slight decrease in the number of new born piglets this summer, the price has risen slightly due to the influence of both supply and demand.

[Liu Feng, Secretary-General of China Banking Association: A good start to the reform of bank wealth management subsidiaries] On November 20th, Liu Feng, deputy secretary and secretary-general of the Party Committee of China Banking Association, said that in recent years, my country's banking wealth management structure has been continuously optimized and the net worth has been transformed. The intensity has been gradually increased, and the risk level has been further mitigated. The investment philosophy of "breaking the redemption" and "sellers are responsible, buyers are responsible" has gradually taken shape. Wealth management subsidiaries of various banks have begun to take shape. Wealth management services have played an active role in serving the real economy and boosting residents' wealth growth. . Specifically, it is mainly reflected in the following aspects: first, industry chaos and risks have been effectively contained; second, the market scale is improving steadily, and business transformation is continuously advancing; third, the reform of wealth management subsidiaries has started well; fourth is the implementation of inclusive finance. Meet the diversified investment needs of residents. (China Securities Network)

[Public placement REITs are about to be launched and can be used as long-term retirement assets] Nearly five months after the first batch of 9 publicly-raised real estate investment trusts (REITs) pilot products went on sale, the second batch of public offerings will be on sale soon. The two public REITs approved recently are expected to be officially launched from November 26 to 29, and will be established on December 6 at the earliest. Based on the high recognition of the first batch of publicly offered REITs, stable market operation and a good start, the second batch of publicly offered REITs is expected to continue to win the favor of investors. Since publicly offered REITs are particularly suitable for long-term holding, some insiders suggest that public investors deploy them as future pension assets to seek non-speculative, long-term stable income. (China Fund News)

[China Cereals and Oils Information Network: The price increase of rice may have ended] Due to the end of the phased stocking of terminal rice, the rice market may experience a relatively long period of weak demand. In particular, there was still a certain amount of surplus in the old rice grains of the previous year. Therefore, rice enterprises can still consume orders in the short term. The main force of market acquisition is still the acquisition of grain depots. Once the rotation of grain depots is completed, the market supply pressure will still be great. The recent increase in corn and wheat prices has increased farmers’ psychological expectations for rice prices. However, compared with the above two varieties, the stock of rice is much larger than them. Therefore, it is recommended that the main grain holders sell grain in time to avoid causing the end of the year and the Spring Festival. The previous concentrated grain sales were under pressure, which led to a decline in rice prices.

[my country’s car ownership will exceed 300 million by the end of this year, and the production and sales of new energy vehicles will break new records.] On November 20, according to Shi Jianhua, Deputy Secretary-General of the China Association of Automobile Manufacturers, my country’s automobile industry development achievements during the "13th Five-Year Plan" period Dazzling. my country's auto market is the largest in the world, and its auto production, sales, and ownership have ranked first in the world for many years. By the end of September this year, my country's car ownership will reach 297 million, and it will exceed 300 million by the end of the year. At the same time, the new energy automobile industry has entered a new stage of development, and the degree of marketization is constantly improving. (Xinhua News Agency)
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