Posted at 11 May 2021 / Categories Market Roundups
Market Roundup
• German Apr WPI (YoY) 7.2%, 4.4% previous
• German Apr WPI (MoM) 1.1%, 1.7% previous
• Italian Mar Industrial Production (MoM) -0.1%, 0.4% forecast, 0.2% previous
• Italian Mar Industrial Production (YoY) 37.7%,37.2% forecast, -0.6% previous
•EU May ZEW Economic Sentiment 84.0, 66.3 previous
• German May ZEW Current Conditions 40.1, -41.3 forecast, -48.8 previous
• German May ZEW Economic Sentiment 84.4, 72.0 forecast, 70.7 previous
•Brazil Apr CPI (YoY) 6.76% forecast, 6.10% previous
•Brazil Apr CPI (MoM) 0.30% forecast, 0.93% previous
Looking Ahead - Economic Data (GMT)
•12:55 US Redbook (YoY) 14.2% previous
•12:55 US Redbook (MoM) -17.2% previous
•13:45 US Apr ISM-New York Index 804.5 previous
•13:45 US Apr ISM NY Business Conditions 37.2% previous
•14:00 US Mar JOLTs Job Openings 7.500M forecast, 7.367M previous
Looking Ahead - Economic events and other releases (GMT)
•14:30 UK BoE Gov Bailey Speaks
•14:30 US FOMC Member Williams Speaks
•14:30 US FOMC Member Brainard Speaks
•17:00 US FOMC Member Daly Speaks
•17:15 US FOMC Member Bostic Speaks
•18:00 US FOMC Member Harker Speaks
Fx Beat
EUR/USD:Euro strengthened against dollar on Tuesday after data showed German investor sentiment surged to its highest level in May since the start of the COVID-19 pandemic. The ZEW economic research institute said its survey of investors' economic sentiment rose to 84.4 points from 70.7 the prior month. The last time it hit a higher level was in February 2000. The single currency climbed 0.35% to $1.2170, holding just below a Feb. 26 high of $1.2179 hit on Monday. It has gained 4% from a five-month low at the end of March. The euro's gains were also bolstered by widespread dollar weakness as investors waited for comments on U.S. policymaker thinking ahead of inflation data on Wednesday. Immediate resistance can be seen at 1.2186 (23.6%fib), an upside break can trigger rise towards 1.2208 (Higher BB).On the downside, immediate support is seen at 1.2110 (5DMA), a break below could take the pair towards 1.2087 (38.2%fib).
GBP/USD: Sterling steadied above $1.41 on Tuesday as market relief over Scottish election results, improved economic forecasts, and lockdown easing measures supported sterling across the board. Pro-independence parties won a majority in Scotland’s parliament on Saturday, which Scottish leader Nicola Sturgeon said gave her a mandate to pursue plans for a second independence referendum. Any second referendum on Scottish independence requires the approval of the British government and Prime Minister Boris Johnson has ruled this out. At 11:40 GMT, the pound was up 0.21% against the dollar at $1.4146. Immediate resistance can be seen at 1.4175 (23.6%fib), an upside break can trigger rise towards 1.4200 (Psychological level).On the downside, immediate support is seen at 1.4068(38.2%fib), a break below could take the pair towards 1.4005(5DMA).
USD/CHF: The dollar edged higher against the Swiss franc on Tuesday as traders braced for U.S. inflation data amid worries growing price pressures might bring forward rate rises. A test case on U.S. inflation will come this week when the Labor Department releases its latest consumer price index report on Wednesday. A host of Federal Reserve speakers this week will be closely watched by markets to assess how authorities are likely to respond to receding risks posed by the coronavirus in some major economies. Immediate resistance can be seen at 0.9043 (5DMA), an upside break can trigger rise towards 0.9065(38.2%fib).On the downside, immediate support is seen at 0.8975(23.6%fib), a break below could take the pair towards 0.8900 (Psychological level).
USD/JPY: The dollar declined against the yen on Tuesday as investors bet that rising inflation would erode the currency's value as the U.S. Federal Reserve maintains its loose monetary policy.The five-year breakeven inflation rate which measures expectations of inflation five years out - reached its highest since April 2011 on Monday.A weaker-than-expected jobs report on Friday helped persuade market participants that the Fed would keep rates low and continue purchasing assets, even if inflation rises. The dollar was trading down 0.20% on the yen at 108.54. Strong resistance can be seen at 108.80 (38.2%fib), an upside break can trigger rise towards 109.29(23.6%fib).On the downside, immediate support is seen at 108.45 (38.2%fib), a break below could take the pair towards 18.07 (61.8%fib).
Equities Recap
European stocks retreated from all-time highs on Tuesday, with shares of technology, travel and mining companies among the top losers after worries about rising U.S. inflation knocked back U.S. indexes.
At (GMT 11:50),UK's benchmark FTSE 100 was last trading down at 2.55 percent, Germany's Dax was down by 2.37percent, France’s CAC was last down by 2.23 percent.
Commodities Recap
Gold prices were steady on Tuesday as a retreat in U.S. Treasury yields countered a slight rebound in the dollar, while investors awaited key data on inflation due later this week.
Spot gold was steady at $1,836.26 per ounce by 0134 GMT, after hitting its highest since Feb. 11 at $1,842.91 on Friday.
Oil prices fell on Tuesday on fading fears of a prolonged outage of the largest U.S. fuel pipeline system, while India's coronavirus crisis showed scant sign of easing.
Brent crude futures dropped 30 cents, or 0.4%, to $68.02 a barrel by 1000 GMT. U.S. West Texas Intermediate (WTI) crude futures fell 32 cents, or 0.4%, to $64.60 a barrel.