US crude oil stock changes exceed forecasts, reporting 5.202 million instead of 1.8 million.
The US Energy Information Administration reported an increase of 5.202 million barrels in crude oil stocks for the week ending October 31. This was much higher than the expected rise of 1.8 million barrels. As a result, WTI crude oil prices have dropped below $60.
Financial Market Developments
In the foreign exchange markets, the EUR/USD pair remains steady near 1.15 as traders recalibrate their expectations on Federal Reserve rate cuts. The Dow Jones Industrial Average has rebounded, gaining 300 points. In other financial news, gold prices have risen by more than 1%, despite strong US economic data. Additionally, the NZD/USD pair saw a slight increase due to China’s easing of tariffs.
Ethereum is showing signs of recovery, maintaining support around $3,350 after recent drops. However, Stellar (XLM) may face a downturn, as a ‘Death Cross’ pattern on the charts indicates a possible 15% correction. The overall market sentiment might be challenged by upcoming economic data and central bank decisions.
The unexpected increase in crude oil inventories signals bearish trends in the energy market. With stockpiles up by over 5.2 million barrels compared to a forecast of 1.8 million, this indicates weakening demand as winter approaches. Traders may want to consider short positions, possibly through buying put options on WTI futures, to hedge against or profit from further price declines below $60 per barrel.
Market expectations for a Federal Reserve rate cut are decreasing, which is strengthening the US Dollar. With October’s core inflation rate above 3.5% and recent job data surprising analysts, there seems to be a strong case for the Fed to keep its restrictive stance. This makes shorting currency pairs like EUR/USD via futures or options a practical strategy, as the dollar’s yield advantage is likely to remain.
Risk Management Amid Uncertainty
Although the Dow Jones has rebounded, there are still significant risks because of the ongoing US government shutdown, which has now lasted over 40 days. This political uncertainty is beginning to affect economic forecasts, making protective strategies wise for equity portfolios. It could be a good time to buy put options on major indices like the S&P 500 to protect against a sudden market downturn if negotiations stall.
Gold’s movement toward the $4,000 mark is noteworthy, especially since it’s happening alongside a strong dollar. This situation is unusual and indicates a significant push towards safer investments, as many investors are concerned about the political climate in the US. This divergence from typical market behavior suggests that long positions in gold, possibly through call options on futures, could be a strong move in the upcoming weeks.
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Steady gold prices show balanced demand, but a stronger US dollar limits gains
Gold is currently trading within a tight range, sitting around $3,975 after dipping to $3,928 on Tuesday. Demand for gold remains strong due to a global shift towards risk aversion.
Concerns are rising over US tech stocks and the possibility of corrections in their valuations. This unease has spread through both Asia and Europe. Adding to the complexity, the US government has been in a shutdown for 36 days.
The Influence of the US Dollar
The US Dollar is gaining strength, which is hindering gold’s price increases. However, fear in the market is still providing some support for gold. Recently released ADP data shows that private employment rose by 42,000 in October, surpassing expectations. Additionally, the ISM Services PMI indicates growth in this sector. In the political arena, President Trump has issued executive orders to ease trade tensions with China, but the US Supreme Court is reviewing tariffs related to these orders after lower courts ruled against them. The potential for interest rate cuts by the Federal Reserve is currently unclear. There is a 68% chance of rate cuts in December, a decrease from 94%. Due to the shutdown, official economic data is delayed, which impacts the Fed’s forecasting ability. Technically, gold is showing signs of indecisiveness, with a slight bearish lean as it trades below the 21-period Simple Moving Average. The Relative Strength Index is sitting at 44, indicating weak momentum and suggesting that gold may continue to trade within its current range. Gold remains trapped between $3,900 and $4,050, reflecting substantial indecision in the market. In the short term, strategies that profit from low volatility could be beneficial. However, several events on the horizon could lead to a significant price breakout.The Shutdown’s Impact
The strong US dollar, currently at a multi-month high of 100.30 on the DXY, is the main factor keeping gold prices down. Strong private payroll numbers and a rebound in the ISM Services PMI are driving this dollar appreciation. In this context, bearish strategies, such as buying put options targeting a drop below the $3,900 support level, could be appealing if strong US economic data continues to emerge. Conversely, the ongoing US government shutdown, now the longest in history at 36 days, is increasing risk aversion, which helps support gold prices. During a similar shutdown from 2018 to 2019, which lasted 35 days, gold rose by about 3%. The longer this shutdown lasts, the higher the likelihood of a price rally due to economic uncertainty. The Federal Reserve’s current position also adds tension, with the market predicting a 68% chance of a December rate cut. Although this probability has decreased, it still provides a support floor for gold prices. Any indications of economic weakness caused by the shutdown could quickly raise these odds back above 90%, potentially triggering a sharp increase in gold and making call options a strategic choice. Additionally, we should monitor inflation, as the ISM Prices Paid component has surged to 70.0, a notably high figure. This suggests ongoing inflationary pressures, which typically enhance gold’s appeal as a hedge. This situation is similar to 2022 when central banks purchased a record 1,136 tonnes of gold, highlighting its long-term value against inflation. One key event to watch for this week is the Supreme Court hearing regarding presidential tariff authority. A ruling that limits these powers could weaken the US dollar and push gold prices up, while a decision to uphold them could strengthen the dollar. The uncertainty surrounding this ruling suggests that volatility may return soon, making it wise to prepare for a breakout from the current tight trading range. Create your live VT Markets account and start trading now.USD/CAD reaches a seven-month high due to the Canadian Dollar’s weakness against the US Dollar
The USD/CAD pair is reaching seven-month highs, primarily driven by robust US economic data that boosts the Dollar. Currently, the pair is around 1.4126, marking its highest point since April 9 and putting pressure on the Canadian Dollar (CAD). The strength of the US Dollar comes from the ISM Services PMI, which rose to 52.4 in October, indicating growth in the US services sector.
In October, US private payrolls increased by 42,000. This improvement counters a drop in September and suggests that the labor market remains strong. This positive trend supports the Federal Reserve’s possible decision to keep interest rates steady in December. The US Dollar Index, which measures the Dollar against six major currencies, stands at 100.30, the highest level since May 29.
Oil Prices And Trade Tensions
Oil prices are also impacting the Canadian Dollar, with West Texas Intermediate crude priced around $60.00 per barrel. Additionally, ongoing trade tensions between the US and Canada affect the CAD’s value. Prime Minister Mark Carney recently apologized to President Donald Trump over an anti-tariff advertisement, which halted trade talks. Trump has yet to agree to continue negotiations, creating uncertainty in bilateral trade relations. A table is included, showing percentage changes in major currencies, highlighting the US Dollar’s strength against the Japanese Yen. Given the strong signals from the US economy, we should expect continued strength in the US Dollar against the Canadian Dollar in the coming weeks. With the USD/CAD rate near 1.4126 breaking through key resistance, we could see it rise further. Using call options on USD/CAD may be a smart strategy to take advantage of this upward trend while managing risks. The rebound in the ISM Services PMI to 52.4 is significant, supporting the belief that the Federal Reserve will not cut interest rates in December. The Prices Paid component rising to 70.0 is particularly noteworthy, reflecting cost pressures not seen consistently since the high-inflation period of 2022-2023. This data strongly suggests the Fed will maintain a hawkish approach, which is positive for the Dollar.Canadian Dollar Facing Headwinds
Although the ADP payroll figure of 42,000 is not exceptionally strong, it indicates a positive change from the decline in September, highlighting resilience in the labor market. Historically, ADP figures like this can hint at a stronger official Non-Farm Payrolls (NFP) report. We will closely monitor the upcoming NFP data, as a positive surprise could further lift the US Dollar. Conversely, the Canadian Dollar is struggling. WTI crude oil prices have softened to around $60 per barrel, down from an average of over $77 earlier this year, providing little support for Canada’s key export. The unresolved trade tensions with the US add more uncertainty and weakness to the Loonie. This clear gap between a strong US economy and a struggling Canadian economy points to further gains for USD/CAD. The trend appears to lean upward, suggesting that strategies to profit from this momentum should be considered. Buying call options targeting strike prices of 1.4200 or higher seems like a logical move for the next few weeks. Create your live VT Markets account and start trading now.Pound Sterling consolidates above 1.30 with modest support from better-than-expected PMI results
The Pound Sterling is trading calmly above 1.30, supported by some recent positive data. The final services and composite PMI readings came in slightly better than expected, landing in the low 50s.
People are closely watching the UK’s financial situation ahead of the November budget. There are worries about the Office for Budget Responsibility’s productivity estimates. The Bank of England is expected to keep interest rates at 4.00%, following earlier cuts and a careful approach due to ongoing inflation concerns.
Inflation Concerns Persist
Even though the headline CPI is close to the 2% target, wage growth and inflation in services are still high. Governor Andrew Bailey mentioned that inflation isn’t completely under control, indicating they may keep rates steady. EUR/USD is trading below the 1.1500 level, struggling to find demand amid a strong US Dollar. GBP/USD remains under pressure, staying below 1.3050, as everyone looks forward to the BoE meeting, where the consensus is a rate hold. Gold prices are eyeing $4,000 per troy ounce, supported by US Treasury yields. Ethereum is making a comeback, rising to $3,350 after previous market dips. On the other hand, Stellar may see a 15% drop as interest wanes, following a Death Cross pattern on its chart. The upcoming week may challenge investor sentiment due to US data and central bank meetings. With Pound Sterling trading steadily above 1.30, there’s an opportunity in the current low volatility. The implied volatility for GBP/USD over the next month is around a three-month low of 7.2%. However, this may change with the UK budget announcement expected on November 26. It might be wise to think about buying straddles or strangles that expire in early December to prepare for likely price swings after the budget is released.Fiscal Update Risks
The main risk for the Sterling is a negative fiscal update, especially with talk of bigger budget shortfalls. We recall the market turmoil after the mini-budget in 2022. With UK debt-to-GDP now over 105%, any sign of fiscal trouble could lead to a sudden sell-off. Buying GBP/USD put options with a strike price of 1.29 or 1.28 could be a way to hedge against a possible drop below the 1.30 support level. The Bank of England’s choice to maintain rates at 4.00% reflects this cautious stance. Recent data from October 2025 shows UK wage growth at 5.5%, preventing the central bank from hinting at possible future cuts, which removes a potential support factor for the pound. As a result, fiscal news is set to be the key driver for Sterling in the upcoming weeks. It’s important to note the US Dollar’s strength, which is holding back gains for other currencies. The October ISM Services PMI came in strong at 54.1, making it tough for EUR/USD to break through the 1.1500 resistance level. We could use this technical barrier to position ourselves bearish, such as by selling call spreads on the Euro. Gold’s resilience is impressive, as it aims for $4,000 per ounce, even as US Treasury yields rise. This suggests strong support from ongoing inflation fears and geopolitical uncertainty. We believe this trend is bolstered by continued demand from central banks, as data from the World Gold Council in Q3 2025 shows significant net purchases by emerging market institutions. In the crypto market, there’s an interesting divergence that could open up pairing opportunities. While Ethereum is finding stability above $3,350, Stellar (XLM) has just confirmed a “Death Cross,” where its 50-day moving average dipped below the 200-day average. We should consider taking long positions in ETH futures while also looking to short XLM or buy put options to benefit from its bearish momentum. Create your live VT Markets account and start trading now.In October, analysts were surprised when the Services PMI rose to 52.4, surpassing expectations.
The US ISM Services PMI increased to 52.4 in October, up from last month’s 50.0 and exceeding predictions of 50.8. The Prices Paid Index rose slightly to 70.0, the Employment Index improved to 48.2, and the New Orders Index increased to 56.2.
After the PMI announcement, the US Dollar gained strength, with the US Dollar Index reaching highs of 100.30-100.40. The Dollar performed best against the Japanese Yen among major currencies.
Services Sector Outlook
The ISM Services PMI will be released at 15:00 GMT, expected to show modest growth in the services sector. Due to recent disruptions in US economic data from a government shutdown, this report could impact the value of the US Dollar. An ISM Services PMI above 50 is likely to strengthen the US Dollar, which could influence the EUR/USD exchange rate. The Federal Reserve’s decisions, including possible rate cuts, are also important for market responses. A country’s GDP growth can make its currency more appealing for foreign investment, while a falling GDP may lead to currency decline and impact commodity prices, such as Gold. The October ISM services report is stronger than expected, indicating that the US economy is performing better than anticipated. The significant rise in new orders prompts us to reconsider ideas of an upcoming slowdown. We may need to rethink strategies that assume the Federal Reserve will definitely adopt a dovish approach. The inflation aspect of the report is concerning, with the Prices Paid Index at 70.0. This matches the recent Consumer Price Index (CPI) data, showing core inflation significantly above the Fed’s target, with September 2025 at 3.8%. Ongoing price pressures in the large services sector make it challenging for the Fed to consider lowering interest rates.Repercussions in Financial Markets
Following this report, market expectations for a December rate cut have significantly dropped. Probabilities on the CME FedWatch Tool fell from about 67% to under 40%. This sharp decline reflects the recurring “higher-for-longer” interest rate environment we saw in 2023 and 2024. For currency traders, this supports a bullish outlook for the US Dollar. We should consider buying call options on the US Dollar Index (DXY) or on pairs like USD/JPY, as the Bank of Japan continues its loose policy. This difference in central bank strategies opens the door for ongoing dollar strength. In interest rate markets, this data suggests yields will stay high. Strategies that benefit from the market pricing out rate cuts, such as selling SOFR futures contracts with near-term expirations, could be advantageous. The mixed signals of strong growth coupled with a declining employment rate may lead to a flatter yield curve. This report brings an added layer of uncertainty, potentially increasing volatility in the coming weeks. The combination of stubborn inflation and a robust economy, alongside a weak job market, creates a complex situation. We can utilize options strategies like straddles on equity indices to take advantage of possible sharp movements, as the market assesses whether this strong data is ultimately good or bad for risk assets. Create your live VT Markets account and start trading now.US ISM services PMI surpasses expectations with a figure of 52.4
The ISM Services PMI for October in the United States is at 52.4, beating the predicted 50.8. This upbeat news helped lift the Dow Jones Industrial Average by 300 points.
In the commodities market, WTI Crude Oil dropped below $60 due to unexpected inventory increases. Meanwhile, gold rose by over 1%, despite the strong US data affecting market sentiments.
FX Market Movements
In the FX market, the NZD/USD saw a slight rise on news about China easing tariffs, even though New Zealand’s job market remains weak. The EUR/USD struggled to move above the 1.1500 level. GBP/USD stayed steady just under 1.3050, as eyes turned towards the Bank of England meeting, with no changes expected to the policy rate at 4.00%. Ethereum showed signs of recovery and began trading upward after previous drops. On the other hand, Stellar faced possible losses due to the formation of a Death Cross pattern. Upcoming events include a session with the US Supreme Court and more economic data from the US, which may challenge the Dollar’s strength. Overall, market sentiment remains mixed after recent earnings and trade news.Continued US Economic Strength
The ISM Services report at 52.4 indicates the US economy is holding strong, contrary to earlier predictions of a slowdown. The third quarter of 2025 also showed resilience, with GDP growth at a solid 2.9%, indicating healthy consumer and business activity. This makes it hard to bet against the US economy in the short term. This robust economic performance is likely to keep the Federal Reserve on the sidelines, with less expectation for rate cuts this year. Current market pricing suggests a less than 15% chance of a rate cut before the second quarter of 2026. As a result, we anticipate continued strength in the US Dollar, creating opportunities for those holding long positions on it. For equity index traders, the strong services data supports a positive outlook for the S&P 500. However, the ongoing government shutdown introduces volatility. Historical data shows that similar political gridlocks, like the 2018-2019 shutdown, can unexpectedly unsettle markets. In this situation, strategies such as buying call options on the SPX while holding cheaper, out-of-the-money puts for protection could be effective. The dollar’s strength is exerting pressure on foreign currencies, especially the Euro, which is having difficulty maintaining its value. With recent Eurozone inflation figures for October 2025 at a modest 2.1%, the European Central Bank has little incentive to take a more aggressive approach. This policy difference should keep the EUR/USD pair under pressure, making put options on the Euro an attractive hedge or speculative play. Gold is climbing toward $4,000 an ounce, indicating traders are viewing it as a safe haven against systemic risks, likely due to the government shutdown. A similar pattern occurred during the 2023 debt ceiling crisis when gold price surged even as bond yields increased. This suggests that call options on gold could be a good bet as long as political uncertainty remains high in Washington. In energy markets, the unexpected inventory increase reported by the EIA is the main driver, pushing WTI crude below $60 per barrel. The report showed an increase of over 4 million barrels, while a slight decrease was anticipated, indicating that supply is currently outstripping demand. We believe this trend will persist, making short positions or buying puts on oil futures a solid strategy in the weeks ahead. Create your live VT Markets account and start trading now.In October, the ISM services prices paid in the United States increased from 69.4 to 70.
US Market Movements
In October, the ISM Services Prices Paid Index in the US rose to 70, up from 69.4 in September. The Dow Jones Industrial Average bounced back with a 300-point increase as the markets began to stabilize. The Bank of England is expected to keep its policy rate steady, while the US government shutdown reaches a new high. West Texas Intermediate crude oil dropped below $60 due to a surprise rise in inventory. Gold prices increased by over 1%, counterbalancing strong US data that caused mixed reactions in the market. The NZD/USD saw a slight uptick thanks to tariff relief from China, despite New Zealand’s weak job market. The EUR/USD is struggling below the 1.1500 mark, as positive US economic data strengthens the dollar. The GBP/USD remains just under 1.3050, with expectations that the BoE will hold its policy rate at 4.00%. Gold is nearing $4,000 per troy ounce, rebounding from previous declines as US Treasury yields rise. Ethereum also shows signs of recovery after recent downturns, trading around $3,350.Market Volatility And Opportunities
Market sentiment is uncertain with upcoming Federal Reserve actions and US data releases. Stellar may face a 15% correction due to falling demand, indicated by a Death Cross pattern. This article highlights potential trading opportunities and challenges. It emphasizes the need for thorough research before making financial decisions, acknowledging the risks involved. Inflation remains persistent, with the ISM Services Prices Paid Index reaching 70, indicating that price pressures continue. In late 2023, the index hovered in the high 50s, but now it suggests that inflation is picking up again. This, along with a surprisingly strong ADP report, raises doubts about any near-term easing of monetary policy. The futures market might be undervaluing the risk of the Federal Reserve maintaining a hawkish stance. In early 2024, the market anticipated over 150 basis points of cuts that never materialized by year-end. This suggests that positioning for higher rates for longer—such as selling SOFR futures or buying put options on Treasury note futures—could be a smart move. While equity markets show some recovery, the ongoing government shutdown creates a backdrop for volatility. This situation is typical for higher volatility, so it may be wise to buy protection or take advantage of price swings using options on the S&P 500. Purchasing VIX calls could be a direct way to profit if the current calm in stocks turns out to be temporary. There’s a significant divergence in commodities that offers clear trading opportunities. WTI crude oil has fallen below $60 due to a surprise inventory build, suggesting that selling call spreads or buying puts on oil futures is the best course of action. This situation is similar to the massive 19-million-barrel inventory build we saw in January 2023, which preceded a sharp price decline. On the other hand, gold is close to the $4,000 level despite a strong US dollar, indicating a flight to safety or serious concerns about sovereign debt. This trend is unusual and suggests bullish momentum. Using call options on gold futures could allow participation in further gains while managing the risk of a price reversal. In the currency market, the strength of the US dollar is the main theme, leaving pairs like EUR/USD struggling below 1.1500. Strong US economic data continues to support the dollar against other currencies. Therefore, consider options strategies that benefit from the dollar’s outperformance, like buying puts on the EUR/USD or GBP/USD. Create your live VT Markets account and start trading now.ISM services employment index in the United States rises from 47.2 to 48.2
The ISM Services Employment Index in the United States increased to 48.2 in October, up from 47.2 the month before. This rise reflects changes in the wider economy.
Market Movements
The Dow Jones Industrial Average rose by 300 points as markets began to stabilize. At the same time, WTI Crude Oil prices fell below $60 due to unexpected inventory data from the EIA. Gold saw a gain of over 1% even with mixed market reactions driven by strong U.S. economic data. In currency exchange, the NZD/USD pair increased slightly after China eased tariffs, even though the New Zealand labor market is showing signs of weakness. The GBP/USD pair remained mostly unchanged at around 1.3050, as focus shifted to the upcoming policy decision from the Bank of England. Ethereum is trying to recover, trading at $3,350 after previous declines in the cryptocurrency market. Stellar (XLM) may face a potential 15% drop as it shows a Death Cross pattern, indicating a possible decrease in demand. The upcoming week could challenge the dollar’s current position due to various economic factors.Volatility and Investment Strategies
The current market is showing mixed signals, making it perfect for volatility plays. The US services employment index is at 48.2, an improvement, but it still indicates contraction in a vital sector. Using options to bet on price fluctuations in indices like the S&P 500, rather than predicting their direction, seems wise. Gold’s rise toward the $4,000 mark is the most significant trend right now. This rally overshadows the previous one that broke the 2024 record highs, suggesting many are seeking safety or fearing inflation. Consider buying call options on gold futures or related ETFs to capitalize on this upward momentum. On the other hand, crude oil dropping below $60 signals serious concerns about global demand, a sharp decline from the $80-plus prices in 2024. The unexpected rise in inventory suggests this weakness may continue. Buying puts on oil ETFs could be an effective move to prepare for further declines. The Dow’s 300-point gain is promising, but we should stay cautious due to soft labor data. This rebound might just be temporary within a broader uncertain range. An iron condor on the SPX, which benefits from the index remaining between two prices, could be a good strategy for the upcoming weeks. The US Dollar remains strong even after the recent Fed rate cut, indicating that capital continues to flow into US assets. With EUR/USD struggling to break above 1.1500, maintaining bearish positions on the pair, perhaps through selling call spreads, appears to be a solid approach. This matches the overall sentiment in the market. Create your live VT Markets account and start trading now.The ISM Services New Orders Index in the U.S. increased from 50.4 to 56.2
The ISM Services New Orders Index in the United States jumped to 56.2 in October, up from 50.4. This increase indicates a positive trend in new orders in the American service sector.
The Dow Jones Industrial Average rose by 300 points, suggesting a market recovery. On the other hand, WTI crude oil fell below $60 due to an unexpected rise in inventory reported by the EIA.
Currency Market Dynamics
In the currency market, EUR/USD struggles to stay above the 1.1500 mark, even with better-than-expected US economic data. The GBP/USD is staying steady, remaining below 1.3050, as attention shifts to the upcoming Bank of England meeting. Gold increased by more than 1%, nearing $4,000 per troy ounce, driven by changes in US Treasury yields. Meanwhile, Ethereum is gaining momentum, stabilizing around the $3,350 support level after recent drops. Next week could test risk sentiment, influenced by statements from the Federal Reserve, the US Supreme Court, and economic data affecting the Dollar’s strength. The Australian and British currencies may move in opposite directions as their central banks prepare for meetings. Stellar (XLM) may face more losses, with a possible 15% correction due to soft retail demand. We are observing strong US services data, with the ISM New Orders rising to 56.2, a level we haven’t seen in over a year. This indicates the economy’s solid foundation, even with a record-long government shutdown in its fifth week. Given these mixed signals, traders might want to prepare for increased market volatility. Historically, the VIX tends to rise by 15-20% during prolonged shutdowns, similar to what we experienced in 2018-2019.US Dollar’s Continued Strength
The US dollar looks poised to stay strong, driven by robust domestic data compared to stagnation elsewhere. The Dollar Index (DXY) remains firmly above 108.00, keeping the EUR/USD under the important 1.1500 resistance level. We should consider selling out-of-the-money call options on the Euro or Pound to collect premiums, betting on the dollar’s continued strength through the end of the year. Gold’s recent rise is notable, as it continues to climb despite the strong dollar, highlighting its role as a safe haven amid political turmoil in Washington. This rally has been steady since gold broke past its 2024 high of approximately $2,400 per ounce. Buying call options with a strike price at or just below $4,000 could be an effective way to capitalize on this momentum as the market approaches this crucial psychological level. In contrast to the economic optimism, WTI crude oil is showing weakness, having broken decisively below $60 a barrel. The latest EIA report revealed a surprise inventory increase of over 4 million barrels, indicating that supply is outstripping demand. We recommend buying put options on crude futures, aiming for a decline towards the $55 support level in the coming weeks. Create your live VT Markets account and start trading now.S&P Global Services PMI for the United States recorded at 54.8, below expectations
The S&P Global Services PMI for October in the United States came in at 54.8, which is lower than the expected 55.2. This figure reflects a mixed mood in the market due to varying economic activities.
In positive news, the Dow Jones Industrial Average gained 300 points, indicating a recovery. WTI crude oil dropped below $60 due to an unexpected rise in inventory, while gold prices rose by over 1%.
