Posted at 31 May 2023 / Categories Market Roundups
Market Roundup
•Canada GDP (QoQ) (Q1) 0.8% ,0.4% forecast,0.0% previous
•Canada GDP Implicit Price (QoQ) (Q1) 0.20% , 1.80% forecast, -0.70% previous
•Canada GDP (YoY) (Q1) 2.21% ,2.80% forecast, 2.07% previous
•Canada GDP Annualized (QoQ) (Q1) 3.1% ,1.5% forecast, 0.0% previous
•US May Chicago PMI 40.4, 47.0 forecast, 48.6 previous
•US Apr JOLTs Job Openings 10.103M,9.775M forecast, 9.590M previous
•US May Texas Services Sector Outlook -17.3,-16.0 forecast ,-14.4 previous
•US May Dallas Fed Services Revenues 6.9, 4.2 forecast ,6.9 previous
Looking Ahead Economic Data(GMT)
•00:30 Japan May Manufacturing PMI 50.8 forecast , 49.5 previous
•01:30 Australia Private New Capital Expenditure (QoQ) (Q1) 1.3% forecast ,2.2% previous
•01:30 Australia Building Capital Expenditure (MoM) (Q1)8.4% forecast ,3.6% previous
•01:30 Australia Plant/Machinery Capital Expenditure (QoQ) (Q1)-0.1% forecast ,0.6% previous
•01:30 Australia Retail Sales (MoM) 0.0% forecast ,0.4% previous
•01:45 China Caixin Manufacturing PMI 50.3 forecast ,49.5 previous
Looking Ahead Events And Other Releases(GMT)
•No events ahead
Currency Summaries
EUR/USD: The euro declined against dollar on Wednesday after data showed European inflation is cooling quicker than expected. Data on Wednesday showed inflation in France and some of Germany's biggest states is slowing quickly. Analysts said the figures reduced the pressure on the European Central Bank (ECB) to keep raising interest rates, diminishing the euro's attractiveness relative to the dollar.In France, inflation cooled in May to its lowest level in a year as energy and food price increases moderated. The euro fell to $1.066 earlier in the session, the lowest since March 20. Immediate resistance can be seen at 1.0709(5DMA), an upside break can trigger rise towards 1.0719(23.6%fib).On the downside, immediate support is seen at 1.0639(23.6%fib), a break below could take the pair towards 1.0625(Lower BB).
GBP/USD: Sterling strengthened against dollar on Wednesday as dovish comments by Federal Reserve officials weighed dollar. Then Fed officials including its vice chair-designate pointed to a rate hike skip in June, which prompted a turnaround in expectations for the U.S. central bank's intentions. Whereas federal funds futures traders at midday had seen a roughly two-thirds chance the Fed will hike interest rates at its June 13-14 meeting, as of late afternoon trading they saw a 73% probability the Fed would leave rates unchanged. Immediate resistance can be seen at 1.2462 (23.6%fib), an upside break can trigger rise towards 1.2488 (18th May high).On the downside, immediate support is seen at 1.2398 (5DMA), a break below could take the pair towards 1.2399(38.2%fib).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Wednesday as data showing the domestic economy grew stronger than expected in the first quarter bolstered bets for another interest rate hike by the Bank of Canada. Canada’s economy expanded at an annualized rate of 3.1% in the first quarter, eclipsing forecasts for an increase of 2.5%, and likely accelerated further in April. The Canadian dollar was trading 0.2% higher at 1.3575 to the greenback, recovering after it touched its weakest intraday level since Friday at 1.3651. Immediate resistance can be seen at 1.3588 (5DMA), an upside break can trigger rise towards 1.3605 (38.2%fib).On the downside, immediate support is seen at 1.3561 (38.2%fib), a break below could take the pair towards 1.3506(50%fib).
USD/JPY: The U.S. dollar dipped against Japanese yen on Wednesday after a Federal Reserve official warned any decision by the central bank to hold its benchmark overnight interest rate firm at an upcoming meeting would not mean that it is done tightening monetary policy.In remarks on Wednesday, Fed Governor and vice chair nominee Philip Jefferson said that skipping a rate hike would allow the Fed "to see more data before making decisions about the extent of additional policy firming. In a busy day in currency markets, the Japanese yen last strengthened 0.34% versus the greenback at 139.33 per dollar. Strong resistance can be seen at 140.21(23.6%fib) an upside break can trigger rise towards 140.87(May 30th).On the downside, immediate support is seen 138.84(38.2%fib), a break below could take the pair towards 137.58(50%fib)
Equities Recap
European shares hit a two-month low on Wednesday as concerns about a global slowdown on China's weak economic data and uncertainty around the U.S. debt ceiling outpaced optimism from signs of easing inflation in some major euro zone economies.
UK's benchmark FTSE 100 closed down by 1.01 percent, Germany's Dax ended down by 1.54 percent, France’s CAC finished the day down by 1.54 percent.
U.S. stocks closed down on Wednesday as a deal to raise the federal debt ceiling headed for a crucial vote in Congress, while unexpectedly strong labor market data rattled investors who fear the Federal Reserve might hike interest rates again in June.
Dow Jones closed down by 0.41% percent, S&P 500 closed down by 0.61% percent, Nasdaq settled down by 0.63% percent.
Treasuries Recap
U.S. Treasury yields mostly moved lower on Wednesday on stronger jobs data and comments by Federal Reserve officials, ahead of a key U.S. congressional debt ceiling vote.
The yield on benchmark 10-year Treasury notes US10YT=RR was down 6.7 basis points to 3.629%.
Commodities Recap
Gold firmed on Wednesday supported by lower Treasury yields but the dollar's strength, with more interest rate hikes in the offing and optimism about a U.S. debt deal kept bullion on course for its first monthly dip in three.
Spot gold was up 0.4% at $1,966.89 per ounce by 1418 EDT (1818 GMT) on weaker-than-expected Chicago Purchasing Managers' Index (PMI) data, before paring some gains on stronger U.S. jobs data.
Oil prices settled lower on Wednesday, pressured by a stronger U.S. dollar and weak data from top oil importer China that fed demand fears.
Brent crude futures for August delivery settled down $1.11 to $72.60 a barrel. U.S. West Texas Intermediate crude (WTI) settled down $1.37, or 2%, to $68.09.