Posted at 02 September 2022 / Categories Market Roundups
Market Roundup
•US Unit Labor Costs (QoQ) (Q2) 10.2%,10.7% forecast, 10.8% previous
•US Nonfarm Productivity (QoQ) (Q2) -4.1%,-4.5% forecast,-4.6% previous
•Canada Jul Building Permits (MoM) -6.6%, -0.5% forecast,-1.5% previous
•US Initial Jobless Claims 232K,248K forecast,243K previous
•US Continuing Jobless Claims 1,438K,1,438K forecast,1,415K previous
•US Jobless Claims 4-Week Avg 232K,247.00K previous
•Canada Aug Manufacturing PMI 48.7, 52.5 previous
•US Aug Manufacturing PMI 51.5,51.3 forecast, 51.3 previous
•US Aug ISM Manufacturing New Orders Index 51.3, 48.0 previous
•US Jul Construction Spending (MoM) -0.4%,-0.4% forecast, -1.1% previous
•US Aug ISM Manufacturing Employment 54.2,49.0 forecast, 49.9 previous
•US Aug ISM Manufacturing PMI 52.8, 52.0 forecast, 52.8 previous
•US Aug ISM Manufacturing Prices 52.5, 55.5 forecast,60.0 previous
• US Natural Gas Storage 61B, 58B forecast,60B previous
Looking Ahead - Economic Data (GMT)
•No data ahead
Looking Ahead - Economic events and other releases (GMT)
•No significant events
Fxbeat
EUR/USD: The euro slipped against dollar on Thursday after U.S. data showed a resilient economy, giving the Federal Reserve more room to aggressively hike interest rates to quell inflation.The U.S. currency firmed after a government report showed that the number of Americans filing new claims for unemployment benefits declined further last week, consistent with strong demand for workers and tight labor market conditions. The report also showed fewer layoffs in August, despite hefty interest rate increases from the Fed to counter decades-high inflation, which have raised the risk of a recession. The euro slid 0.99%, falling back below parity against the dollar to $0.9956. Immediate resistance can be seen at 0.9982(5DMA), an upside break can trigger rise towards 1.0107(23.6%fib).On the downside, immediate support is seen at 0.9918 (23.6%fib), a break below could take the pair towards 0.9832(Lower BB).
GBP/USD: Sterling fell against the dollar on Thursday, adding to August losses that were its worst since late 2016, as storm clouds gather over the British economy. The pound lost 4.6% against the dollar last month in its worst performance since October 2016, fuelled by concerns about slowing growth in the British economy as inflation gathers pace.British inflation soared to 10% in July, its highest in 40 years, and is predicted to climb higher, squeezing the pay packages of hard-hit consumers further. British government bonds are suffering, too, enduring their biggest monthly fall since 1994. The British pound hit a fresh 2-1/2-year low of $1.1501 and was last down around 0.02%. Immediate resistance can be seen at 1.1620(Daily high), an upside break can trigger rise towards 1.1688(38.2%fib).On the downside, immediate support is seen at 1.1549(23.6%fib),a break below could take the pair towards 1.1500(Psychological level).
USD/CAD: The Canadian dollar dipped against its U.S. counterpart on Thursday as better-than-than expected U.S. manufacturing data bolstered the dollar. U.S. manufacturing grew steadily in August as employment and new orders rebounded, data showed. As traders bet that the Fed will deliver its third 75 basis points hike of the year in September, the dollar has stayed buoyant. The loonie was trading 0.1% lower at C$1.3145 to the greenback, after trading in a range of 1.3126 to 1.3207. All eyes are now on U.S. August nonfarm payroll data due on Friday. Analysts expect 285,000 jobs were added last month, while unemployment hovered at 3.5%. Investors may not like a strong number if it supports the basis for a continuation of aggressive rate hikes, which could further boost the U.S. dollar. Immediate resistance can be seen at 1.3187(Higher BB), an upside break can trigger rise towards 1.3220 (23.6%fib).On the downside, immediate support is seen at 1.3125 (38.2%fib), a break below could take the pair towards 1.3110 (5DMA).
USD/JPY: The dollar rose against yen on Thursday as investors braced for higher U.S. interest rates while expecting anchored Japanese rates to go nowhere anytime soon. Expectations for a 75-basis-point U.S. rate hike at next month's Federal Reserve meeting are rising on the back of solid economic data, with Fed funds futures last pointing to a 75% chance of such an increase. Markets are awaiting U.S. non-farm payrolls data on Friday and they may not like a strong number if it supports the basis for a continuation of aggressive rate hikes, which could further boost the U.S. dollar. Strong resistance can be seen at 140.01(23.6%fib), an upside break can trigger rise towards 141.55(Higher BB).On the downside, immediate support is seen at 139.32(5DMA), a break below could take the pair towards 138.21(38.2%fib).
Equities Recap
European stocks closed sharply lower on Thursday, the first session of September, as worries about grown amid looming interest rate hikes rendered the mood bearish and triggered widespread selling in several sectors.
UK's benchmark FTSE 100 closed down by 1.65 percent, Germany's Dax ended down by 1.60 percent, France’s CAC finished the day down by 1.48 percent.
A late rally helped the S&P 500 snap a four-session losing skid on Thursday with investor focus turning to a key report on the labor market on Friday.
Dow Jones closed up by 0.46% percent, S&P 500 closed up by 0.30% percent, Nasdaq settled down by 0.26% percent.
Treasuries Recap
U.S. Treasury yields surged in a volatile trading session on Thursday as investors anticipated strong job reports that could spur further aggressive monetary tightening by the U.S. Federal Reserve as it seeks to fight four-decade-high inflation.
Two-year note yields jumped to a new 15-year high of 3.511% and five-year yields increased by over 12 basis points to 3.407%.
Commodities Recap
Oil prices tumbled more than 3% on Thursday, as new COVID-19 lockdown measures in China added to worries that high inflation and interest rate hikes are denting fuel demand.
Brent crude settled down $3.28 at $92.36 a barrel, a 3.4% drop. U.S. West Texas Intermediate (WTI) crude futures fell $2.94, or 3.3%, to $86.61 per barrel.
Gold prices fell below the key $1,700 level on Thursday for the first time since July, as a rising dollar and expectations for aggressive interest rate hikes eroded its appeal.
Spot gold was down 0.8% at $1,696.76 per ounce by 13:58 p.m. ET, having dropped to its lowest since July 21 earlier in the session.U.S. gold futures settled 1% lower at $1,709.3.