Posted at 10 July 2023 / Categories Market Roundups
Market Roundup
•French 12-Month BTF Auction 3.761% ,3.697% previous
•French 3-Month BTF Auction 3.556%,3.439% previous
•French 6-Month BTF Auction 3.673%,3.584% previous
•US May Wholesale Trade Sales (MoM) -0.2%0.3% forecast,0.2% previous
•US May Wholesale Inventories (MoM) 0.0%, -0.1% forecast,-0.1% previous
•US Jun CB Employment Trends Index 114.31, 116.26 forecast,116.15 previous
•US Consumer Inflation Expectations 3.8%,4.1% previous
Looking Ahead Economic Data(GMT)
•23:50 Japan Jun M3 Money Supply 2,102.7T previous
•23:50 Japan M2 Money Stock (YoY) 2.9% forecast, 2.7% previous
•00:30 Australia Jul Westpac Consumer Sentiment 2.7% forecast, 0.2% previous
•01:30 Australia NAB Business Confidence -1 forecast,-4 previous
Looking ahead Events And Other Releases(GMT)
•No events ahead
Currency Summaries
EUR/USD: EUR/USD: The euro strengthened against dollar on Monday as markets awaited U.S. CPI data on Wednesday for further guidance for Federal Reserve's policy stance. U.S. consumer prices data scheduled for Wednesday is expected to show a slowdown in June inflation. Fed officials have been mostly hawkish in their communications, while markets have also priced in higher rates in Europe and the UK. Canada's central bank meets this week and markets imply a 67% chance of another hike.The risk of higher global rates for longer has caused havoc in bond markets, where U.S. 10-year yields jumped 23 basis points last week, German yields 24 basis points and UK yields 26 basis points. Immediate resistance can be seen at 1.1005(23.6%fib), an upside break can trigger rise towards 1.1037 (23.6%fib).On the downside, immediate support is seen at 1.0928(38.2%fib), a break below could take the pair towards 1.0908( (5DMA).
GBP/USD: The pound strengthened on Monday against weaker dollar as investors became convinced that Bank of England will take a tough line on inflation by raising rates further. The main data point for UK markets this week are wage growth figures on Tuesday. Data on Tuesday will offer a snapshot of the labour market. Economists by Reuters expect the unemployment rate to have held steady at 3.8% in May, but the day's main event will be wage growth figures. Average earnings excluding bonuses are expected to have risen at an annual rate of 7.1% in the three months to May, down a touch from April's 7.2%. Sterling was last up 0.02% against the dollar at $1.2863 . Immediate resistance can be seen at 1.2863(23.6%fib), an upside break can trigger rise towards 1.2884(Higher BB).On the downside, immediate support is seen at 1.2751(5DMA), a break below could take the pair towards 1.2702(38.2%fib).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Monday as oil prices fell and market focus turned to Wednesday's U.S. inflation data. Oil prices fell 1% on growing expectation of interest rate hikes in the United States, but crude supply cuts from major oil exporters Saudi Arabia and Russia limited the losses. On the data front, the value of building permits in Canada rose 10.5% in May, Statistics Canada said. The loonie was trading 0.1% lower at C$1.3277 to the greenback, or 75.32 U.S. cents, after trading in a range of 1.3269 to 1.3304 .Immediate resistance can be seen at 1.3333 (38.2%fib), an upside break can trigger rise towards 1.3370(Higher BB).On the downside, immediate support is seen at 1.3271(5DMA), a break below could take the pair towards 1.3211 (23.6%fib).
USD/JPY: The dollar fell to three week low against the yen on Monday as investors digested Fed official comments. Several Fed officials said on Monday additional interest rate hikes are needed to bring down inflation that is still too high, but the end to the U.S. central bank's current monetary policy tightening cycle is getting close. Investors await of U.S. inflation data later this week to gauge the impact of interest rate hikes and if more policy tightening was on the cards.Markets still think the Federal Reserve is likely to hike rates this month, but a weak CPI might lessen the risk of a further move in September. Strong resistance can be seen at 142.68(5DMA) an upside break can trigger rise towards 144.02(23.6%fib).On the downside, immediate support is seen 140.95(38.2%fib), a break below could take the pair towards 139.90(Lower BB)
Equities Recap
European shares inched higher on Monday with the travel & leisure sector leading gains, helping to limit the impact of weak inflation data from China that highlighted sluggish demand in the world's second-largest economy.
UK's benchmark FTSE 100 closed up by 0.23 percent, Germany's Dax ended up by 0.45 percent, France’s CAC finished the day up by 0. 45 percent.
U.S. stocks ended higher on Monday following last week's losses, while Federal Reserve officials' comments bolstered the view that the U.S. central bank may be near the end of its tightening cycle.
Dow Jones closed up by 0.62 percent, S&P 500 ended up by 0.24 percent, Nasdaq finished the day up by 0.18 percent.
Treasuries Recap
U.S. Treasury yields fell on Monday and the inversion in a key part of the yield curve contracted as investors waited for inflation data due on Wednesday for further clues on whether price pressures are continuing to moderate.
The benchmark 10-year yield reached an eight-month high of 4.094% on Friday as investors bet the Federal Reserve will continue hiking rates to battle still-elevated inflation. The yield fell to 4.004% on Monday.
Commodities Recap
Oil prices eased 1% on Monday on the increasing likelihood of more U.S. interest rate hikes, but crude supply cuts from top oil exporters Saudi Arabia and Russia limited the losses.
Brent crude futures settled down 78 cents, or 1%, at $77.69 a barrel after touching their highest level in more than two months earlier in the session.U.S. West Texas Intermediate crude fell 87 cents, or 1.2%, at $72.99.
Gold was little changed on Monday as investors awaited U.S. inflation data that could influence the Federal Reserve's policy stance, while palladium prices dropped below the $1,200-per-ounce level for the first time since December 2018.
Spot gold was steady at $1,925.30 per ounce by 01:49 p.m. EDT (1749 GMT). U.S. gold futures settled 0.1% lower at $1,931.