US stocks upbeat on solid GDP data

Wednesday, December 23, 2015

US economic growth was revised down in the third quarter as the economy accelerated by 2.0% q/q from a previous reading of 2.1% with consumer spending the driving force behind the expansion. Despite the downward revision, growth in Q3 was slightly better than consensus expectations of 1.9% q/q and followed on from a particularly strong second quarter where the economy gained 3.9% q/q. Personal consumption gained 3.0% q/q during the third quarter as household purchases improved substantially on a combination of lower fuel prices and a robust labour market, however, with inflation struggling to lift and business investment slowing there’s still a long way to go before investors can be fully confident in the US economy.

The dollar index headed lower for a third straight session yesterday as the greenback gave back practically all of its post FOMC rate decisions gains and tested support towards the 50 day MA. Investors took additional profits after the slight downward revision to US third quarter GDP data and sentiment was knocked further by lower than expected existing home sales in the US, which dropped to 4.76m in November from 5.32m the previous month and was less than the 5.35m expected by market participants. Activity early on this morning has seen the dollar index find firm support around the 50 day MA, trading towards 98.360 against a basket of major currencies.

A busy session for economy data today as investors eagerly await the release of final third quarter UK GDP data, while over in the US we will see the release of November personal income data, durable goods orders and the University of Michigan sentiment index as well as EIA crude stockpile data in quick succession. Third quarter personal spending has already come out, indicating strong consumer activity in November as spending increased 0.3% m/m.

US Q3 GDP holds firm at 2.0% q/q

GDP CQOQ Index GDP US Chained 2 2015 12 23 08 05 34

Dollar index continues to consolidate recent gains

DXY Curncy DOLLAR INDEX SPOT 2015 12 23 08 12 28

Events for today

JP Market Holiday 




Personal Spending








Personal Income




Durable Goods Orders




U. of Michigan Sentiment (Final)




EIA Crude Oil Stocks

Topics: GDP, DXY
More from: Kash Kamal