Posted at 22 April 2022 / Categories Market Roundups
Market Roundup
•Benchmark U.S. 10-year yields edge toward over 3-year peak
• U.S. weekly jobless claims at lowest level in 52 years
•US Jobless Claims 4-Week Avg. 177.25K, 172.75K previous
•US Continuing Jobless Claims 1,417K,1,455K forecast,1,475K previous
•US Initial Jobless Claims 184K, 180K forecast, 186K previous
•US April Philadelphia Fed Manufacturing Index 17.6, 21.0 forecast, 27.4 previous
•US April Philly Fed Prices Paid 84.60, 81.00 previous
•US April Philly Fed Employment 41.4, 38.9 previous
•US April Philly Fed Business Conditions 8.2, 22.7 previous
•US April Philly Fed CAPEX Index 19.90, 24.80 previous
•US Mar Leading Index (MoM) 0.3%,0.3% forecast,0.3% previous
Looking Ahead - Economic Data (GMT)
•No economic data ahead
Looking Ahead - Economic events and other releases (GMT)
•No events ahead
Currency Summaries
EUR/USD: The euro declined on Thursday after European Central Bank President Christine Lagarde said the ECB may need to cut its growth outlook further as the fallout from Russia's invasion of Ukraine weighs on households and businesses. Lagarde's comments were in contrast to hawkish comments from ECB officials who seemed to suggest European Central Bank officials raised bets that euro zone interest rates will rise soon. Money markets, which had eased rate hike bets following last Thursday's ECB meeting, were now pricing in a more than 20 basis-point (bps) rise by July and over nearly 80 bps of tightening by year-end. In late trading, the euro fell 0.2% to $1.0832, after hitting $1.0936, its highest level since April 11. Immediate resistance can be seen at 1.0894 (38.2%fib), an upside break can trigger rise towards 1.0944(Daily high).On the downside, immediate support is seen at 1.0817 (5DMA), a break below could take the pair towards 1.0760 (23.6%fib).
GBP/USD: The British pound weakened against dollar on Thursday as investors focused on the respective future monetary policy paths of the Bank of England and other major central banks. BoE monetary policymaker Catherine Mann said on Thursday interest rates would probably have to go up “a little bit” further, and that in some ways Britain’s economy was already suffering from stagflation. The Bank of England last month softened its language on the need for more interest rate increases while stressing downside risks to the economy. Immediate resistance can be seen at 1.3044 (14DMA), an upside break can trigger rise towards 1.3112 (38.2%fib).On the downside, immediate support is seen at 1.3021 (23.6%fib), a break below could take the pair towards 1.2979(Lower BB).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Thursday, pulling back from an earlier two-week high, as hawkish comments by Federal Reserve Chair Jerome Powell pressured U.S. equity markets. Wall Street's three main indexes fell and the U.S. dollar gained ground against a basket of major currencies after Powell said a 50-basis point interest rate hike was "on the table", cementing expectations of aggressive policy tightening by the U.S. central bank. The Canadian dollar was trading 0.7% lower at 1.2580 to the greenback, or 79.49 U.S. cents, after earlier touching its strongest level since April 5 at 1.2459..Immediate resistance can be seen at 1.2601(38.2%fib), an upside break can trigger rise towards 1.2657(50%fib).On the downside, immediate support is seen at 1.2741 (38.2%fib), a break below could take the pair towards 1.2657 (23.6%fib).
USD/JPY: The dollar strengthened against the yen on Thursday after Federal Reserve Chair Jerome Powell all but confirmed a half a percentage-point tightening at the policy meeting next month, including consecutive rate increases this year. The dollar index , which gauges the strength of the currency versus a basket of rivals, gained 0.2% to 100.53, after trading lower for most of the session. The index has advanced 2.3% so far this month, on pace for its best monthly gain since June 2021. Fed funds futures have started to price in bets of three straight 50 basis-point hikes starting with next month's policy meeting, with an implied rate of about 2.71% in December.Strong resistance can be seen at 128.77 (23.6%fib), an upside break can trigger rise towards 129.79 (Higher BB).On the downside, immediate support is seen at 128.09(5DMA), a break below could take the pair towards 126.85(50%fib).
Equities Recap
European stocks closed higher on Thursday, moving up for a second straight session, as investors continued to react to corporate earnings updates and largely shrugged off geopolitical concerns and worries about inflation.
UK's benchmark FTSE 100 closed down by 0.02 percent, Germany's Dax ended up by 0.98 percent, France’s CAC finished the day up by 1.36 percent.
Wall Street's ended lower on Thursday, with the Nasdaq dropping more than 2%, as investors reacted to Federal Reserve officials including Chair Jerome Powell offering further signposting of aggressive interest rate hikes this year.
Dow Jones closed down by 1.05% percent, S&P 500 closed by 1.48% percent, Nasdaq settled down by 2.07% percent.
Treasuries Recap
U.S. Treasury yields rose on Thursday and two-year yields hit three-year highs as Federal Reserve officials took a hawkish tone on tightening policy, cementing the view that the U.S. central bank will hike interest rates aggressively as it fights soaring inflation.
Benchmark 10-year yields were last 2.900%. They reached a high of 2.981% on Wednesday, the highest since December 2018. Two-year yields , which are highly sensitive to interest rates, reached 2.730% on Thursday.
Oil prices rose on Thursday, buffeted by concerns about tightened supply as the European Union (EU) mulls a potential ban on Russian oil imports that would further restrict worldwide oil trade.
Brent crude futures settled up $1.53to close at $108.33 a barrel, after earlier reaching a high of $109.80. U.S. West Texas Intermediate (WTI) crude futures ended up $1.60, or 1.6%, to $103.79, after earlier reaching a high of $105.42.