Nasdaq 100 forecast: Nasdaq 100 consolidates after recent rally

US futures

Dow futures +0.02% at 34950

S&P futures +0.08% at 4519

Nasdaq futures +0.11% at 15830

In Europe

FTSE -0.20% at 7481

Dax -0.25% at 15882

• Stocks consolidate after strong gains this month
• Wait and see ahead of tomorrow’s FOMC minutes
• Microsoft in focus as it hires Sam Altman, Open AI ex-CEO
• Oil rises on OPEC+ supply cut bets 

Stocks inch higher after strong gains across November

U.S. stocks are heading for a modestly higher open, consolidating after strong gains across the previous week and with Microsoft in focus as the tech giant hires Sam Altman.

The three main US indices staged a stellar rebound across November, posting gains for a third straight week after cooler-than-expected US inflation data supported bets that the Federal Reserve was done hiking interest rates.

Investors are cautiously looking ahead to tomorrow's FOMC minute and Nvidia’s earnings.

Markets have nearly fully priced in the likelihood that the Fed will leave interest rates unchanged in the December meeting and have brought forward expectations of a 25 basis point rate cut to a 60% probability in May.

Whether the rally in stocks takes another step higher this week will depend on the tone of the minutes from the November FOMC meeting. The market perceived the meeting to be more dovish than it was expecting. Will the minutes support this view? The risk is that the market has gotten ahead of itself as it optimistically looks for a dovish pivot from the US central bank.

Corporate news

Microsoft is under the spotlight after the tech giant is set to hire Sam Altman to lead its new advanced AI research team just days after he was ousted as CEO of open AI.

Nvidia is set to rise on the open ahead of tomorrow's quarterly results and amid confidence that the tech giant can outperform thanks to optimism towards all things AI.

Boeing is set to rise over 1% on the open after Deutsche Bank upgraded its stance on the aircraft manufacturer to buy from hold amid expectations of increasing commercial jet deliveries.

Broadly, airlines could be in focus this week as Thanksgiving traveling is expected to reach a record level.

Nasdaq 100 forecast – technical analysis

The Nasdaq 100 is consolidating below 16000 and above 15500 the September high. The RSI is just below overbought territory. Buyers will look for a rise above 16000 to extend gains to 16760 November ’22 high. Failure to rise above 16000 could see sellers test support at 15500 ahead of 15085 the October high.

FX markets – USD falls, GBP/USD rises

The USD is falling, extending losses from last week and dropping to at 2.5-month low versus major peers as attention turns to when the Federal Reserve will start cutting interest rates.

EUR/USD is rising, adding to gains from last week, despite German PPI cooling by 11% YoY after falling 14.7% in September. ECB policymaker Pierre Wunsch also warned that the market may be getting too optimistic about rate cuts and that the central bank could hold the 4% level longer to tame inflation. CPI data on Friday showed the inflation cooled 2.9% in October.

GBP USD is consolidating just below 1.25 as investors await a speech by BoE Governor Andrew Bailey. His comments will be watched closely for clues over the future path of interest rates after data last week showed that inflation cooled by more than expected. The market is pricing in around a 60% probability of a rate cut in May.

EUR/USD +0.10% at 1.0920

GBP/USD +0.08% at 1.2475

Oil rises on OPEC+ supply cut bets

Oil prices are rising, extending a 4% gain on Friday as attention turns to the OPEC+ meeting at the end of this week and the prospect of the oil cartel deepening supply cuts to support oil prices that have been declining for the past four weeks.

While oil prices fell last week, they did jump 4% on Friday on reports that OPEC+ is considering making additional supply cuts when it meets on November 26th. Oil prices have fallen almost 20% since the end of September on concerns of weakening demand and record non-OPEC supply.

Last week, the US energy companies added oil and gas rigs for the first time in three weeks. The oil and gas rig count services are an early indicator for future output.

WTI crude trades +2,2% at $77.65

Brent trades +2.07% at $81.85