Posted at 18 June 2022 / Categories Market Roundups
Market Roundup
•Canada May IPPI (MoM) 1.7%, 0.5% forecast, 0.8% previous
•Canada May IPPI (YoY) 15.0%,16.4% previous
•Canada Apr Foreign Securities Purchases 22.23B, 46.94B previous
•Canada Apr Foreign Securities Purchases by Canadians 29.20B,-23.98B previous
• US May Industrial Production (YoY) 5.83%, 6.40% previous
• US May Manufacturing Production (MoM) -0.1%,0.3% forecast,0.8% previous
• US May Capacity Utilization Rate 79.0%,79.2% forecast, 79.0% previous
• US May Industrial Production (MoM) 0.2%, 0.4% forecast, 1.1% previous
• US Leading Index (MoM) -0.4%,-0.4%forecast, -0.3% previous
• U.S. Baker Hughes Oil Rig Count 584,580 previous
• U.S. Baker Hughes Total Rig Count 740, 733 previous
Looking Ahead Economic Data(GMT)
•No data ahead
Looking Ahead - Events, Other Releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro declined against dollar on Friday as a slew of interest rate hikes from major central banks fuelled worries about a sharp economic slowdown. Markets were heading for their biggest weekly decline since markets' pandemic meltdown in March 2020, hit by growing worries about a recession after rate increases in the United States and Britain were followed by a surprise move in Switzerland to quell an inflation surge. The ECB also faces high inflation, though perhaps a more delicate task because its economies feel even more strongly the headwinds from Russia's invasion of Ukraine, which has driven up energy prices worldwide. Immediate resistance can be seen at 1.0570(11DMA),an upside break can trigger rise towards 1.0637(50%fib).On the downside, immediate support is seen at 1.0445(23.6%fib), a break below could take the pair towards 1.0332(Lower BB).
GBP/USD: Sterling fell on Friday in the face of a strengthening U.S. dollar, with the British currency giving up gains made a day earlier after the Bank of England raised interest rates.The pound fell as much as 0.5% against the dollar to $1.2290 , off from a one-week high of $1.2405 touched a day earlier. It was last at $1.23015 and heading towards a slight loss for the week, which would be its third straight week in the red. The pound had on Thursday gained 1.4% versus the dollar, buoyed by the Bank of England's 0.25% interest rate rise. The increase surprised some investors who had expected a more aggressive move to douse soaring inflation in Britain. Immediate resistance can be seen at 1.2309(38.2%fib),an upside break can trigger rise towards 1.2508 (50%fib).On the downside, immediate support is seen at 1.2180(5DMA), a break below could take the pair towards 1.2068(23.8%fib).
USD/CAD: The Canadian dollar weakened to its lowest in 19 months against its U.S. counterpart on Friday as oil prices tumbled and the greenback broadly rallied. The price of oil, one of Canada's major exports, tumbled to a four-week low on worries that an economic slowdown could cut demand for energy. The loonie was trading 0.5% lower at 1.3020 to the greenback s, after touching its weakest since November 2020 at 1.3078. For the week, the currency was down 1.8%, its biggest weekly decline since August last year, as investors worried that aggressive tightening by central banks, including Wednesday's 0.75 percentage point rate hike by the U.S. Federal Reserve, could derail economic growth. Immediate resistance can be seen at 1.3073 (23.6%fib), an upside break can trigger rise towards 1.3108 (Higher BB).On the downside, immediate support is seen at 1.2937 (38.2%fib), a break below could take the pair towards 1.2844 (50%fib).
USD/JPY: The dollar strengthened against Japanese yen on Friday after the Bank of Japan bucked a wave of tightening and stuck with its ultra-accommodative stance, adding to soaring volatility in currency markets hit by a series of rate hikes this week. Currency markets have been roiled by one of the biggest runs of monetary policy tightening in decades, including the Federal Reserve's mid-week three-quarters-of-a-percentage-point rate increase, its biggest since 1995, and the Swiss National Bank's surprise decision to hike rates by 50 basis points. Japan's central bank swam against the current on Friday, keeping its policy settings unchanged and vowing to defend its bond yield cap of 0.25% with unlimited buying. Strong resistance can be seen at 135.21 (23.6%fib), an upside break can trigger rise towards 134.85(Higher BB).On the downside, immediate support is seen at 133.89 (9DMA), a break below could take the pair towards 132.11(38.2%fib).
Equities Recap
European stocks failed to hold early gains and ended on a mixed note on Friday with investors assessing the likely impact of the interest rate hikes announced by central banks including the Federal Reserve and the Bank of England, on global economic growth.
UK's benchmark FTSE 100 closed down by. 0.41percent, Germany's Dax ended up by 0.67 percent, France’s CAC finished the day down by 0.06 percent.
U.S. stocks closed with a modest bounce on Friday but still suffered the biggest weekly percentage decline in two years as investors wrestled with the growing likelihood of a recession while global central banks tried to stamp out inflation.
Dow Jones closed down by 0.13 percent, S&P 500 ended up by 0.22 percent, Nasdaq finished the day up by 1.43 percent.
Treasuries Recap
U.S. Treasury yields held near this week’s lows on Friday after a volatile five days that saw them hit more than 10-year highs on expectations of aggressive rate hikes, and then fall on concerns about how these will impact growth.
Two-year treasury yields, which are highly sensitive to interest rate moves, were last at 3.166% and are down from 3.456% on Tuesday, which was the highest since November 2007.
Benchmark 10-year yields were at 3.239%, after reaching 3.498% on Tuesday, the highest since April 2011.
Commodities Recap
Oil prices tumbled about 6% to a four-week low on Friday on worries that interest rate hikes by major central banks could slow the global economy and cut demand for energy.
Brent futures fell $6.69, or 5.6%, to settle at $113.12 a barrel, while U.S. West Texas Intermediate (WTI) crude fell $8.03, or 6.8%, to settle at $109.56.
Gold was on course to finish the week lower, falling 1% on Friday, as a stronger dollar and interest rate hikes from major central banks dented the safe-haven metal’s appeal.
Spot gold was down 1% at $1,837.59 per ounce by 1:42 p.m. EDT (1742 GMT). U.S. gold futures settled down 0.5% at $1,840.60. Gold has lost 1.7% so far this week.