Market Roundup:
• US Chicago Jun Fed National Activity 0.05,-0.09 forecast,0.18 previous
•French 12-Month BTF Auction 3.341%, 3.355% previous
• French 6-Month BTF Auction 3.540%,3.537% previous
•French 3-Month BTF Auction3.576%,3.602% previous
Looking Ahead Economic Data (GMT)
•No Economic Data
Looking Ahead – Events and other releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro edged higher on Monday as investors focused on U.S. President Joe Biden's decision to end his re-election campaign and the next moves from the Federal Reserve and the Bank of Japan. Biden announced on Sunday that he was exiting the race and endorsed Vice President Kamala Harris as the Democratic candidate for the November election. Harris quickly received the backing of many within the party, though several high-profile figures, including former House Speaker Nancy Pelosi, remained silent. Meanwhile, former President Trump, the Republican nominee, holds a strong lead in betting markets. The dollar index, which measures its value against a basket of foreign currencies, fell by 0.1% to 104.30.The euro was up 0.05% at $1.0884.Immediate resistance can be seen at 1.0953(23.6%fib).), an upside break can trigger rise towards 1.1000 (Psychological level).On the downside, immediate support is seen at 1.0873(38.2%fib), a break below could take the pair towards 1.0813(50%fib).
GBP/USD: Sterling saw a modest gain on Monday as investors looked forward to the upcoming S&P Global Composite Purchasing Managers Index, set to be released on Wednesday. British inflation exceeded forecasts last week, prompting investors to scale back expectations that the Bank of England (BoE) will begin cutting rates next month for the first time since 2020. Even if the BoE cuts rates in August, it should not significantly impact the British currency outlook if the Federal Reserve follows suit in September, as markets currently anticipate. Investors have priced in a 40% chance of a BoE rate cut in August and over an 80% chance in September. Market participants continue to be concerned about the economic outlook following recent data. Sterling was up 0.05% at $1.2930 after hitting $1.3044 last week, its highest level since July 2023.Immediate resistance can be seen at 1.2933(Daily high), an upside break can trigger rise towards 1.2990(23.6%fib).On the downside, immediate support is seen at 1.2900(38.2%fib), a break below could take the pair towards 1.2833(50%fib).
USD/CAD: The Canadian dollar fell to a five-week low against the U.S. dollar on Monday, as speculators increased their bearish bets on the currency ahead of a potential interest rate cut by the Bank of Canada this week. The Canadian central bank is widely anticipated to lower its benchmark interest rate by 25 basis points to 4.50% on Wednesday, marking its second cut in as many months. This expectation follows recent data indicating easing inflation and a drop in retail sales. According to swaps market data, investors assign a 94% probability to a rate cut this week and are forecasting a total of 62 basis points of easing by the end of the year. The loonie was trading 0.2% lower at 1.3760 to the U.S. dollar , after touching its weakest intraday level since June 14 at 1.3774. Immediate resistance can be seen at 1.3765 (38.2%fib), an upside break can trigger rise towards 1.3810 (23.6%fib).On the downside, immediate support is seen at 1.3727(50%fib), a break below could take the pair towards 1.2684(61.8%fib).
USD/JPY: The dollar dipped against Japanese on Monday as dollar dipped following Joe Biden's decision to bow out of the election race. Markets face a new U.S. electoral calculus after U.S. President Joe Biden's abrupt announcement Sunday that he will end his campaign against former President Donald Trump for reelection.Biden announced on Sunday he would drop out of the election race and endorsed Vice President Kamala Harris for the Democratic ticket.While Biden endorsed Vice President Kamala Harris to replace him at the top of the Democrat's ticket, it's not yet clear who the party will select. The greenback fell 0.3% versus the yen to 157.10. Strong resistance can be seen at 157.46(Daily high), an upside break can trigger rise towards 158.40(50%fib). On the downside, immediate support is seen at 156.38 (23.6%fib), a break below could take the pair towards 155.21 (Lower BB).
Equities Recap
European shares closed up on Monday, recouping some of the steep losses clocked last week with technology and financials leading gains, while Ryanair led a rout amongst airlines after reporting a quarterly profit slump.
UK's benchmark FTSE 100 closed up by 0.53 percent, Germany's Dax ended up by 1.29 percent, France’s CAC finished the day up by 1.16 percent.
Wall Street's three benchmarks ended higher on Monday as investors returned to megacap growth stocks, helping both the S&P 500 , opens new tab and Nasdaq Composite (.IXIC), opens new tab recover from their worst weekly performance since April..
Dow Jones closed up by 0.32% percent, S&P 500 closed up by 1.08% percent, Nasdaq settled up by 1.57% percent.
Commodities Recap
Gold prices fell to a more than one-week low on Monday as the dollar firmed, while traders awaited more U.S. economic data and comments from Federal Reserve officials this week for clarity on the timeline for interest rate cuts.
Spot gold fell 0.2% to $2,394.18 per ounce, as of 1837 GMT. U.S. gold futures settled 0.1% lower at $2,394.70.
Oil prices fell for a second consecutive session on Monday to their lowest level in over a month, as investors looked past U.S. President Joe Biden's decision to end his reelection bid and focused on rising stockpiles and signs of weak demand.
Brent crude futures fell 23 cents, or 0.3%, to settle at $82.40 per barrel, the lowest since June 11. U.S. West Texas Intermediate crude futures for August delivery expired on Monday after falling 35 cents to $79.78 a barrel, also a one-month low.
