Posted at 11 August 2023 / Categories Market Roundups
Market Roundup
•US CPI rises, but largely in line with expectations
•US jobless claims increase in latest week
•Fed funds futures price in no hike, then cut in May 2024
•US weekly jobless claims rise more than expected
•US Indexes up: Dow 0.15%, S&P 0.03%, Nasdaq 0.12%
•US Jul Real Earnings (MoM) 0.0%,-0.1% forecast,0.5% previous
•US Jul CPI (MoM) 0.2%,0.2% forecast,0.2% previous
•US Jul Core CPI (YoY) 4.7%, 4.8% forecast,4.8% previous
•US Jul Core CPI (MoM) 0.2%, 0.2% forecast,0.2% previous
•US CPI (YoY) 3.2%,3.3% forecast,3.0% previous
•US Jul CPI Index, n.s.a. 305.69, 305.84 forecast, 305.11 previous
•US Jul Core CPI Index 308.80,308.33 forecast,308.31 previous
•US Jul CPI, n.s.a (MoM) 0.19%,0.32% previous
•US Jul CPI Index, s.a 304.35,303.84 previous
•US Initial Jobless Claims 248K,230K forecast,227K previous
•US Jobless Claims 4-Week Avg. 231.00K, 231.01K forecast,228.25K previous,
•US Continuing Jobless Claims 1,684K, 1,710K forecast,1,700K previous
• US Natural Gas Storage 29B, 25B forecast, 14B previous
• US Jul Cleveland CPI (MoM) 0.2%,0.4% forecast,0.4% previous
•US 8-Week Bill Auction 5.280%,5.285% previous
•US 4-Week Bill Auction 5.280%,5.275% previous
Looking Ahead Economic Data(GMT)
•No data Ahead
Looking Ahead Events And Other Releases(GMT)
•No significant events
EUR/USD: The euro eased against dollar on Thursday as investors digested U.S. inflation numbers that showed a moderate increase last month. Data showed the consumer price index (CPI) rose 0.2% last month, matching the gain in June. The CPI climbed 3.2% in the 12 months through July, up from a 3.0% rise in June, which was the smallest year-on-year gain since March 2021. A separate report from the Labor Department on Thursday showed initial claims for state unemployment benefits increased 21,000 to a seasonally adjusted 248,000 for the week ended Aug. 5. Economists had forecast 230,000 claims for the latest week. The dollar index , a measure of the U.S. currency against six peers, fell to a low of 101.76 and was last up 0.14% at 102.62 .Immediate resistance can be seen at 1.1006(38.2%fib), an upside break can trigger rise towards 1.1061(Daily high).On the downside, immediate support is seen at 1.0930(50%fib), a break below could take the pair towards 1.0851(61.8%fib).
GBP/USD: Sterling weakened against dollar on Thursday after data showed U.S. consumer prices increased moderately in July.The consumer price index (CPI) rose 0.2% last month, matching the increase in June, the U.S. Labor Department said. The CPI advanced 3.2% in the 12 months through July, up from a 3.0% rise in June, which was the smallest year-on-year gain since March 2021.Traders have cut bets that the Fed will continue raising interest rates as inflation falls back closer to the U.S. central bank's 2% annual target. According to the CME’s FedWatch Tool, the probability the Fed leaves rates unchanged at its September meeting is now at 90.5% from around 86.5% prior to the data. Immediate resistance can be seen at 1.2721(5DMA), an upside break can trigger rise towards 1.2744(23.6%fib).On the downside, immediate support is seen at 1.2651(38.2%fib), a break below could take the pair towards 1.2601(Lower BB).
USD/CAD: The Canadian dollar weakened on Thursday as dollar strengthened after U.S. consumer price inflation moderated in July and boosted hopes the Federal Reserve is near the end of its rate-hiking cycle, but investors remained wary over data due to arrive before policymakers meet next.The consumer price index (CPI) gained 0.2% last month, the Labor Department said, lifting the annualized rate less than expected to 3.2% from 3% in June. Economists polled by expected headline CPI to rise a bit faster at 3.3%. The loonie was trading lower at C$1.3437 to the greenback , after trading in a range of 1.3378 to 1.3449. Immediate resistance can be seen at 1.3454 (23.6%fib), an upside break can trigger rise towards 1.3485(23.6%fib).On the downside, immediate support is seen at 1.3396 (38.2%fib), a break below could take the pair towards 1.3386(9DMA).
USD/JPY: The U.S. dollar steadied against Japanese yen on Thursday after data showed a modest rise in U.S. consumer inflation stoked hopes of a rate hike pause by the Federal Reserve. U.S. inflation increased moderately in July as costs for goods including used motor vehicles declined. The consumer price index (CPI) rose 3.2% in the 12 months through July, below expectations of 3.3%, per a poll of economists. The data bolstered hopes that inflation in the world's largest economy was trending lower, potentially allowing the Fed to hit the brakes on its rate hikes next month. Markets are pricing in a more than 50% chance that the Fed is done with interest rate hikes this year. Strong resistance can be seen at 144.85(23.6%fib) an upside break can trigger rise towards 145.00(Psychological level).On the downside, immediate support is seen 143.83(5DMA), a break below could take the pair towards 142.82(38.2%fib)
Equities Recap
European stocks climbed on Thursday after a modest rise in U.S. consumer prices fuelled hopes that the Federal Reserve was close to the end of its rate hikes, while the luxury sector got a boost from China easing travel restrictions.
UK's benchmark FTSE 100 closed up by 0.41 percent, Germany's Dax ended up by 0.91 percent, France’s CAC finished the day up by 1. 52 percent.
Wall Street's main indexes finished flat on Thursday, giving up most early gains on milder-than-feared inflation data as investors worried about the U.S. economy's longer-term prospects and whether stocks had further room to run.
Dow Jones closed up by 0.15 percent, S&P 500 ended up by 0.03 percent, Nasdaq finished the day up by 012 percent.
Treasuries Recap
U.S. Treasury yields rose on Thursday after data showed that inflation rose only modestly in July, in line with economists' expectations, and as the U.S. Treasury Department saw soft demand for a sale of 30-year bonds.
Benchmark 10-year yields gained 8 basis points on the day to 4.082%. They reached 4.206% on Friday, their highest since Nov. 8.
Two-year yields rose 2 basis points to 4.821%. The yields have fallen from 5.120% on July 6, which was the highest since June 2007.
Commodities Recap
Gold prices ticked up on Thursday after data showed U.S. consumer prices increased moderately in July, cementing expectations the Federal Reserve is at the end of its rate hike cycle.
Spot gold was up 0.1% at $1,915.49 per ounce by 1:51 p.m. EDT (1751 GMT), after rising as much as 0.8% following the release of the U.S. data.U.S. gold futures settled 0.1% lower at $1,948.9.
Oil prices settled lower on Thursday, with Brent crude holding close to January highs, as speculation about another U.S. interest rate hike faded following inflation data and OPEC remained positive on the oil demand outlook.
Brent crude fell $1.15, or 1.3%, to settle at $86.40 a barrel while WTI settled down $1.58, or 1.9%, at $82.82.