Market Roundup
•US May Wholesale Inventories (MoM 0.6%, 0.6% forecast,0.1% previous
• US May Wholesale Trade Sales (MoM) 0.4%,0.1% previous
• US May Heating Oil Stockpiles 0.356M,-0.572M previous
• US Distillate Fuel Production 0.022M, 0.204M previous
• US Gasoline Production 0.239M,0.180M previous
• US Crude Oil Imports 0.615M ,-0.555M previous
• US Crude Oil Inventories -3.443M, 0.700M forecast,-12.157M previous
Looking Ahead Economic Data (GMT)
• No Data Ahead
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Summaries
EUR/USD: The euro edged higher on Wednesday as investors brace for a political deadlock in France in the wake of the shock election win for the country's leftist alliance. The single European currency came under pressure last month after the snap election was called, but has since clawed back some of those losses, although the risk of impasse in parliament is keeping investors wary. France faced potential political deadlock after elections on Sunday threw up a hung parliament, with a leftist alliance unexpectedly taking the top spot but no group winning a majority.Voters delivered a major setback for Marine Le Pen's nationalist, eurosceptic National Rally (RN), which opinion polls had predicted would win the second-round ballot but ended up in the third spot. The results were also a blow for centrist President Emmanuel Macron, who called the snap election to clarify the political landscape after his ticket took a battering at the hands of the RN in European Parliament elections last month. Immediate resistance can be seen at 1.0840(23.6%fib).), an upside break can trigger rise towards 1.0863 (Higher BB).On the downside, immediate support is seen at 1.0799 (38.2%fib), a break below could take the pair towards 1.0762 (50%fib).
GBP/USD: The pound strengthened on Wednesday after Bank of England Chief Economist Huw Pill said on Wednesday the central bank was moving closer to cutting interest rates but services price inflation and wage growth remained uncomfortably strong . Pill said services inflation and wage growth showed "uncomfortable strength despite headline inflation falling to the BoE's 2% target in May, and it was unlikely that June inflation figures due next week would change the big picture.Similarly, uncertainty about the outlook for currently strong levels of wage growth was unlikely to clear up soon.Investors reined in their bets on the BoE cutting rates for the first time since the COVID pandemic swept the world in 2020.Sterling hit its highest level against the U.S. dollar in about a month, jumping by around a third of a cent as he spoke. Immediate resistance can be seen at 1.2822(23.6%fib), an upside break can trigger rise towards 1.2852(Higher BB).On the downside, immediate support is seen at 1.2754(38.2%fib), a break below could take the pair towards 1.2693(50%fib).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Wednesday as investors awaited key US CPI print which could provide further clues on the Federal Reserve's monetary policy path. Powell said in his second day of congressional testimony that he was not ready to conclude that inflation was moving sustainably down to 2%, although he expressed "some confidence of that. To evaluate the trajectory of interest rates, markets will closely watch the U.S. consumer price index due on Thursday and producer price index data scheduled for Friday.Separately, hopes of another rate cut from the Bank of Canada at its July 24 meeting are high, after the last jobs dataset showed Canadian unemployment at a 29-month high..The loonie was trading 0.4% lower at 1.3445 to the greenback, after touching its weakest since Jan. 20 at 1.3475. Immediate resistance can be seen at 1.3645 (38.2%fib), an upside break can trigger rise towards 1.3685(23.6%fib).On the downside, immediate support is seen at 1.3612(50%fib), a break below could take the pair towards 1.3578(61.8%fib).
USD/JPY: The dollar steadied on Wednesday as the Japanese currency remained under pressure from the stark interest rate differentials between the U.S. and Japan. But data on Wednesday showed Japan's wholesale inflation accelerated in June as the yen's declines pushed up the cost of raw material imports, keeping alive market expectations for a near-term interest-rate hike by the central bank. The Bank of Japan said on Tuesday some market players called on the central bank to slow its bond buying to roughly half the current pace under a scheduled tapering plan due this month. The dollar index, which measures the U.S. currency against six others including the euro and yen, was little changed at 105.09, after rising about 0.1% on Tuesday. Against the yen, the dollar rose 0.1% to 161.62 .Strong resistance can be seen at 161.87(23.6%fib), an upside break can trigger rise towards 162.00(Psychological level). On the downside, immediate support is seen at 160.61 (38.2%fib), a break below could take the pair towards 159.70(50%fib).
Equities Recap
European shares advanced on Wednesday amid broad-based gains and upbeat corporate updates while investors digested more comments from U.S. Federal Reserve Chair Jerome Powell's second day of testimony.
UK's benchmark FTSE 100 closed up by 0.66 percent, Germany's Dax ended up by 0.99 percent, France’s CAC finished the day up by 0.86 percent.
The Nasdaq and S&P 500 rallied to record high closes on Wednesday, fueled by gains in Nvidia and other Wall Street heavyweights ahead of inflation data and quarterly earnings reports due this week.
Dow Jones closed up by 1.09% percent, S&P 500 closed up by 1.02 , Nasdaq settled up by 1.18% percent.
Commodities Recap
Gold prices rose on raised expectations for U.S. interest rate cuts, while investors waited for Thursday's inflation data with a view to bolstering those expectations.
Spot gold added 0.36% to $2,372.25 an ounce. U.S. gold futures gained 0.72% to $2,377.00 an ounce.
Oil prices settled higher after data showed that a jump in U.S. refining activity last week prompted a bigger draw than expected from gasoline and crude inventories but gains were capped as Hurricane Beryl brought minimal supply disruptions.
U.S. crude settled up 0.85%, or 69 cents at $82.10 a barrel and Brent settled at $85.08 per barrel, up 0.5%, or 42 cents on the day.
