Pre-Market Report – Wednesday 13 November: US markets take a pause | Yields jump

 US equities took a breather overnight as treasury yields kicked higher, the USD hit a two-year high, and profit-taking following the post-election rally pressured markets lower. The Dow closed near session lows, off 382 points (0.86%). Up 113 points at best. Down 406 points at worst. The S&P 500 ended its biggest five-day rally in a year, finishing 0.29% lower and the NASDAQ edged 0.09% lower with Tesla losing 6.1% after an almost 45% rally. Small caps lost ground, with the Russell 2000 slipping 1.77% after closing at a three-year high on Monday. Treasury yields jumped overnight, the 2Y yield rose 8.8bps its largest one-day rise since early October, and the 10Y yield gained 11.7bps. Bitcoin approaches $90k level, up 1.82% and the Aussie dollar fell 0.64%. In Fed speak, Kashkari said monetary policy is “modestly restrictive” with borrowing costs slowing inflation and the economy but not by a lot. Barkin notes that the Fed funds rate is out of sync with the economic backdrop and needs recalibration.

ASX SPI Down 81 - CBA comes in at 1Q $2.5bn in line.

COMMODITIES

• US oil industry urges Trump to ditch Biden climate policies.
• Oil prices hold near 2-week low after OPEC cuts demand view, dollar rises.
• Copper slides to two-month low on disquiet over Trump and China.
• OPEC again cuts 2024, 2025 oil demand growth forecasts.

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