Posted at 13 July 2022 / Categories Market Roundups
Market Roundup
•US Redbook (YoY) 13.0%, 13.1% previous
•US IBD/TIPP Economic Optimism 38.5, 38.1 previous
•US 52-Week Bill Auction 2.960%, 3.020% previous
•US 10-Year Note Auction2.960%, 3.030% previous
•US API Weekly Crude Oil Stock 4.762M, -1.933M forecast, 3.825M previous
Looking Ahead - Economic Data (GMT)
• 02:00 NZ RBNZ Interest Rate Decision 2.50% forecast, 2.00% previous
•03:00 China Jun Trade Balance (USD) 75.70B forecast, 78.76B previous
•03:00 China Jun Imports (YoY) 3.9% forecast, 4.1% previous
•03:00 China Jun Exports (YoY) 12.0% forecast, 16.9% previous
•05:00 AU HIA New Home Sales (MoM) -1.2% previous
Looking Ahead - Economic events and other releases (GMT)
• 02:00 NZ RBNZ Rate Statement
Currency Summaries
EUR/USD: The euro held near 20-year low and nearing parity against the U.S. dollar Tuesday as investors worried that an energy crisis in the region would bring on a recession. The single currency hit its lowest level since December 2002 at $1.00005 against the dollar after data showed German investor sentiment fell in July from levels seen at the start of the coronavirus pandemic amid energy concerns, supply shortages and interest rate hikes by the European Central Bank Bank (ECB). The single currency was last at $1.0045, after bouncing from the $1 area.Immediate resistance can be seen at 1.0110 (5DMA), an upside break can trigger rise towards 1.0205 (38.2% fib).On the downside, immediate support is seen at 1.0000 (Psychological level), a break below could take the pair towards 0.9936 (Lower BB).
GBP/USD: Sterling fell to a fresh two-year low on Tuesday as a broad dollar rally and political uncertainty weighed on sentiment. Boris Johnson's resignation as Prime Minister last week deepened uncertainty over the UK economy, which is already under pressure from near double-digit inflation, the risk of a recession and Brexit. Britain's main opposition Labour Party will put forward a motion for a no-confidence vote in Johnson's government on Tuesday, with the vote expected to take place on Wednesday. Immediate resistance can be seen at 1.1867 (5DMA), an upside break can trigger rise towards 1.2059 (38.2%fib).On the downside, immediate support is seen at 1.1810 (23.6% fib), a break below could take the pair towards 1.1790(Lower BB).
USD/CAD: The Canadian dollar weakened against its US counterpart on Tuesday on falling oil prices, but the currency's losses were contained ahead of an expected oversized interest rate hike this week by the Bank of Canada. Money markets expect the central bank to hike interest rates by three-quarters of a percentage point on Wednesday to combat rising inflation, which would be the biggest hike in 24 years. The loonie was down 0.2% at 1.3030 to the greenback, after trading in a range of 1.2985 to 1.3050 during the session. Immediate resistance can be seen at 1.3049 (23.6%fib), an upside break can trigger rise towards 1.3093 (Higher BB).On the downside, immediate support is seen at 1.2992(5 DMA), a break below could take the pair towards 1.2948 (38.2%fib).
USD/JPY: The dollar dipped against the Japanese yen Tuesday as the prospect of further tightening by central banks, renewed COVID outbreaks in China and Europe’s energy shortages spooked investors. The focus for this week will be macro data including the Consumer Price Index from the U.S. on Wednesday, and comments from Federal Reserve Officials as investors look for clues for the outcome of the Fed’s upcoming policy meeting before officials enter the pre-meet blackout period. A high inflation reading would add pressure for the Fed to step up its already aggressive pace of interest rate increases. The U.S. dollar fell 0.47% against the Japanese yen to 136.78, after hitting 137.73 on Monday, the strongest level in 24 years. Strong resistance can be seen at 137.56 (23.6% fib), an upside break can trigger rise towards 138.11 (Higher BB).On the downside, immediate support is seen at 136.60 (5 DMA), a break below could take the pair towards 135.60 (38.2% fib).
Equities Recap
European stocks rose on Tuesday, bolstered by struggling travel, luxury and aerospace stocks, although worries over an energy supply crisis and a possible global recession limited gains.
UK's benchmark FTSE 100 closed up by 0.18 percent, Germany's Dax ended up by 0.57 percent, France’s CAC finished the day up by 0.80 percent.
Wall Street ended in negative territory on Tuesday as growing signs of a recession kept buyers out of the stock market ahead of inflation data.
Dow Jones closed down by 0.62 percent, S&P 500 down by 0.92 percent, Nasdaq down by 0.95 % percent.
Treasuries Recap
Treasury yields fell for a second consecutive day on Tuesday as concerns over slowing growth continued to spur investors into US Treasuries.
U.S. benchmark 10-year yields were down 8 bps, at 2.9078% .
Commodities Recap
Gold hit a nine-month low on Tuesday, amid pressure from a strong dollar and bets on higher interest rates, as investors braced for a slew of US economic data that could set the pace of monetary tightening.
Spot gold fell 0.5% to $1,724.80 per ounce by 1951 GMT. U.S. gold futures settled down 0.4% at $1,724.8.
Brent crude futures settled $7.61, or 7.1% lower, at $99.49 a barrel, its lowest since April 11. U.S. West Texas Intermediate crude was down $8.25, or 7.9%, at $95.84, also the lowest in three month.
Global benchmark Brent crude fell $7 on Tuesday to settle below $100 a barrel for the first time in three months on stronger dollar, COVID-19 restrictions on top crude importer China and growing fears of a global economic slowdown .