Markets Cautious Ahead of Non-Farm Payrolls and Unemployment

The EUR/USD pair is extending its losing streak for the fifth trading day on Thursday, sliding to an almost two-week low near 1.1500 during the European session. The pair declined by -0.35% on Wednesday, driven by the strengthening USDX, which is currently trading firmly near a five-month high around 100.30.

The primary factor driving the Euro's weakness is the rapid decline in expectations for a December interest rate cut by the Federal Reserve (Fed). Traders pared their Fed dovish bets following the release of the Federal Open Market Committee (FOMC) minutes on Wednesday. The minutes from the October policy meeting revealed that many policymakers supported holding interest rates steady in December, citing concerns that further monetary policy easing could entrench consumer inflation expectations.

Going forward, investors are keenly awaiting the United States Nonfarm Payrolls (NFP) data for September, due out at 13:30 GMT. The NFP report is crucial as it will heavily influence the Fed’s interest rate outlook, particularly since many officials have been warning of downside labor market risks. Meanwhile, the Euro will be influenced by the preliminary HCOB Purchasing Managers’ Index (PMI) data for November, which is scheduled for release on Friday.

The price of Gold (XAU/USD) is currently directionless on Thursday, with traders holding off on major moves as they keenly await the delayed US Nonfarm Payrolls (NFP) report for September. The precious metal saw a significant gain of 0.68% on Wednesday.

This rebound, however, is capped by two key headwinds. Firstly, reduced expectations for a December rate cut by the Federal Reserve (Fed)—confirmed by Wednesday’s FOMC Minutes which showed policymakers cautioned against cutting rates further due to inflation risk—has boosted the US Dollar (USD) to its highest level since late May, and a stronger USD acts as a headwind for the non-yielding gold. Secondly, despite lingering concerns over US economic momentum following the government shutdown, a general shift toward riskier assets, coupled with geopolitical developments, is undermining gold's safe-haven demand. Specifically, reports that US President Donald Trump approved a 28-point peace plan for Russia and Ukraine—which involves territorial concessions by Ukraine—is viewed by some as easing geopolitical uncertainty.

Traders are highly focused on the delayed NFP report, due later today, as it will be critical in influencing the near-term USD price dynamics and the gold price. Consensus estimates anticipate that the US economy added 50,000 new jobs in September (up from 22,000 in August), with the Unemployment Rate expected to remain steady at 4.3%.

WTI crude oil, the US benchmark, is trading around $59.50 during the Asian trading hours on Thursday, finding support following a sharp decline of -1.85% during Wednesday's session. The current upward pressure is mainly attributable to the latest weekly data from the Energy Information Administration (EIA), which reported a larger-than-expected decline in US crude stockpiles for the week ending November 14. Inventories fell by 3.426 million barrels, a stark contrast to the 6.413 million barrel rise in the previous week and significantly below the market's consensus for a much smaller draw. This decline was driven by higher refinery runs and increased exports.

Nonetheless, the upside for the WTI price is being capped by renewed efforts to end the Russia-Ukraine war. Reports suggest that the US President Donald Trump's administration has signaled to the Ukrainian side that it must consider accepting a US-drafted framework to end the conflict, which includes proposed territorial concessions and military reductions for Kyiv. An end to the war could potentially lift sanctions and lead to higher Russian oil flows, exacerbating global oversupply fears and weighing on prices.

Furthermore, the general market trend of rising US interest rate expectations is also a headwind.

Nvidia Corporation stock moved 2.84% higher on Thursday, extending the positive momentum generated after the release of its fiscal third-quarter results, which decisively surpassed Wall Street expectations. The robust performance was driven by the ongoing demand stemming from the Artificial Intelligence (AI) arms race. Following the report, the stock had initially surged more than 5% in after-hours trading, with CEO Jensen Huang helping to ease investor fears regarding a potential "AI bubble."

For the three months ended October 26, Nvidia demonstrated strong financial performance. Adjusted earnings per share reached $1.30, marking a significant increase from $0.78 a year earlier and beating the consensus estimate of $1.25. Total revenue for the quarter was $57.01 billion, an impressive rise of 62% year-over-year, which surpassed the forecast of $54.8 billion. Gross margins, at 73.6%, also managed to beat estimates.

The cornerstone of the company’s success remains the Data Center business, the core growth engine supplying the latest Blackwell and Hopper AI chips. Revenue in this critical segment climbed 66% to $51.22 billion, handily beating estimates. CEO Jensen Huang characterized the demand for Blackwell chips as “off the charts,” noting that cloud GPUs are effectively sold out, with sales fueled by major hyperscalers, including Microsoft, Amazon, and Alphabet.