The dollar strengthens, “hard Brexit” concerns mount, Alcoa (AA) will release its Q3 earnings report ahead of the bell, and OPEC oil production climbed to a record high last month. Here are four things to know in the market on Tuesday, October 11.
1. The Dollar Strengthens on Rate Hike Bets
The dollar was higher against other major currencies on Tuesday, as investors continue to bet on an interest rate hike before the year end.
Market players are betting on a 74% chance that the Federal Reserve will raise interest rates at its December meeting. Markets priced in on a 69% chance the previous day.
The dollar index was up 0.3% to 97.20 during early morning trade after rising to a high of 97.25 earlier.
2. “Hard Brexit” Concerns Heighten
Concerns of a “hard Brexit” continue to heighten this week. A new report from The Times warns cabinet ministers of Britain that the Treasury may lose up to 66 billion pounds in tax revenue each year under a “hard Brexit.”
The loss would be driven by the U.K.’s exit from the EU and reverting to WTO rules. The move would cost the U.K. 9.5% of its GDP.
3. Alcoa to Release Q3 Earnings Report
Alcoa unofficially kicks off the Q3 earnings season by posting its results before the opening bell. The report will be the last as a single company before it splits into two publicly traded firms in November.
Alcoa is expected to post a 0.7% decline in earnings year-on-year for the third quarter. Revenue is projected to increase by 2.5%.
4. OPEC Oil Production Hits Record High in September
Oil production from OPEC members reached a record high in September, according to the International Energy Agency.
The IEA stated OPEC crude output increased by 160,000 barrels per day, reaching a high of 33.64 million barrels in September. Increased production in Libya, Iran, Iraq and Nigeria drove numbers up.
The news sent oil prices lower, with U.S. crude losing 16 cents to trade at $51.19 a barrel and Brent losing 23 cents to trade at $52.91 a barrel.
