Market Roundup
• Fed's Dudley upbeat on US employment, return of middle-wage jobs.
• Dudley: two months of strong U.S. growth helped allay earlier concerns.
• ECB did not consider any action at first meeting after Brexit: minutes.
• U.S. jobless claims fall more than forecast: 262k vs 265k expected, 266k previous.
• Philly Fed bang on forecast but jobs, new orders dismal.
• Currency market volumes fall 10 percent in July as Brexit boost fades.
• Chile's economy shrinks 0.4 pct in second quarter from first.
• Britons less gloomy about economy in August – poll.
Looking Ahead - Economic Data (GMT)
• 23:00 Japan Reuters Tankan DI Aug 3 -previous
Looking Ahead - Events, Other Releases (GMT)
• No Significant Events
Currency Summaries
EUR/USD is likely to find support at 1.1300 levels and currently trading at 1.1359 levels. The pair has made session high at 1.1367 and hit lows at 1.1304 levels. The euro rose against dollar on Thursday as the Federal Reserve's July meeting showed a bias among policymakers against raising interest rates soon. The minutes showed members of the rate-setting Federal Open Market Committee were generally upbeat about the U.S. economic outlook. Several Fed policymakers, however, said a slowdown in the future pace of hiring would argue against a near-term hike, and FOMC members said they wanted to leave their policy options open. The euro hit a session high of $1.1356 and the dollar touched a session low against the franc of 0.9540 franc. The dollar also slipped to 99.66 yen earlier, a hair above Tuesday's more than seven-week low of 99.53 yen. The dollar index, which measures the greenback against a basket of six major currencies, was last down 0.58 percent at 94.170 after touching a nearly eight-week low of 94.141.
GBP/USD is supported in the range of 1.3109 currently trading at 1.3163 levels. It reached session high at 1.3171 and hit low at 1.3125 levels. Sterling inched higher against the dollar on Thursday after UK retail sales for July beat forecasts, apparently unaffected by Britain's vote to leave the European Union. The retail sales report was the first to cover a full month following the Brexit vote in late June, showing retail spending rose 5.9 percent for the year and 1.4 percent for the month, compared with forecasts of 4.2 percent and 0.2 percent. Sterling gained 0.9 percent higher on the day against the dollar, and was trading last at $1.3160. It also gained 0.5 percent to 86.20 pence per euro. The U.S. dollar was near an eight-week low against major currencies in the wake of minutes from the Federal Reserve's July meeting published Wednesday showing policymakers were unlikely to raise interest rates soon.
USD/CAD is supported at 1.2700 levels and is trading at 1.2771 levels. It has made session high at 1.2787 and lows at 1.2762 levels. The Canadian dollar rose in the US session against its U.S. counterpart on Thursday as higher oil prices and minutes from the Federal Reserve's July meeting weighed on the greenback. On the data front, the number of Americans filing for unemployment benefits fell more than expected last week, reinforcing views of labor market strength that could encourage the Federal Reserve to raise interest rates soon. Initial claims for state unemployment benefits dropped 4,000 to a seasonally adjusted 262,000 for the week ended Aug. 13, the Labor Department said. Economists had forecast initial claims slipping to 265,000 in the latest week. U.S. crude prices were up 1.11 percent at $47.31 a barrel as the world's biggest producer prepared to discuss a possible freeze in output levels. The Canadian dollar was trading at C$1.2773 to the greenback, stronger than Wednesday's close of C$1.2856, or 77.78 U.S. cents.
AUD/USD is supported around 0.7652 levels and currently trading at 0.7688 levels. It hit session high at 0.7695 and made session lows at 0.7660 levels. The Australian dollar inched higher against US dollar on Thursday, as surge in oil prices and better-than-expected domestic jobs figures supported expectations that interest rates are likely to be on hold for a couple of months at least. The Australian dollar rallied towards $0.7694 in the US session, pulling closer to a three-month peak of $0.7760 touched last week. The Aussie has recovered more than two cents since it hit a trough of $0.7486 when the Reserve Bank of Australia cut rates earlier this month to an all-time low of 1.5 percent. Part of the latest bounce came after Australian employment added 26,200 jobs in July, versus forecasts of 11,000, while the jobless rate unexpectedly dipped to 5.7 percent. Yet, Thursday's report also showed a steep fall in full-time work that spoke of lingering slack in the labour market.
Equities Recap
European shares rose on Thursday to break a four-day losing streak, boosted by dovish U.S. Federal Reserve minutes as financial and industrial stocks stood out.
UK's benchmark FTSE 100 closed up by 0.1 percent, the pan-European FTSEurofirst 300 ended the day up by 0.59 percent, Germany's Dax ended up by 0.6 percent, France’s CAC finished the day up by 0.3 percent.
U.S. stocks ended up slightly on Thursday as Brent oil's rise above $50 a barrel boosted energy shares and an upbeat outlook lifted Wal-Mart to a 14-month high.
Dow Jones closed up by 0.11 percent, S&P 500 ended up by 0.21 percent, Nasdaq finished the day up by 0.21 percent.
Treasuries Recap
U.S. Treasury yields fell on Thursday on bets the Federal Reserve is in no hurry to raise interest rates with domestic inflation stuck below its 2 percent goal and uncertainty about global risks to economic growth at home.
The yield on two-year Treasury notes, which are sensitive to traders' views on Fed policy, was down nearly 3 basis points at 0.710 percent. On Wednesday, it reached a three-week peak of 0.774 percent shortly before the release of the FOMC minutes.
Benchmark 10-year Treasury notes were up 8/32 in price to yield 1.534 percent, down 1 basis point from Wednesday, while the 30-year bond was up 10/32 in price for a yield of 2.258 percent, down 1.5 basis points.
Commodities Recap
Oil prices rose on Thursday for a sixth straight day, with Brent crude rising above $50 for the first time in six weeks as the world's biggest producers prepared to discuss a possible freeze in production levels.
Brent ended the session up 2.09 percent at $50.89. The session high of $51.05 was its highest since June 23.
U.S. crude settled at $48.22, up 3.06 percent after touching a session high of $48.38, the highest since July 5.
Gold rose on Thursday, buoyed by a weaker dollar after minutes from the U.S. Federal Reserve's July meeting showed policymakers were divided over whether to raise interest rates soon.
Spot gold was up 0.3 percent at $1,351.98 an ounce by 2:39 p.m. EDT (1839 GMT), on track for a fourth straight day of gains.
U.S. gold settled up 0.6 percent at $1,357.20 per ounce.
