Market Roundup
•French 12-Month BTF Auction 3.439%, 3.477% previous
•French 3-Month BTF Auction 3.674%, 3.687% previous
•US Consumer Inflation Expectations3, 3.2% previous
•US 3-Month Bill Auction 5.230%, 5.240% previous
•US 6-Month Bill Auction 5.080%, 5.115% previous
Looking Ahead Economic Data(GMT)
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Looking Ahead Events And Other Releases (GMT)
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Currency Summaries
EUR/USD: The euro steadied on Monday, recovering overnight losses that stemmed from projections from France's election which pointed to a hung parliament, while the dollar remained soft. investors weighed up the consequences of a hung French parliament.That was among several surprises in projected results, including the likely first-place finish for the leftist New Popular Front (NFP) alliance, and third-place showing for Marine Le Pen's nationalist, eurosceptic National Rally (RN), which had been the frontrunner going into Sunday's vote. Polling agencies forecast the left would get between 184 and 198 seats - well short of the 289 seats needed for an absolute majority. President Emmanuel Macron's centrist alliance was expected to get 160 to 169 seats, and the RN and its allies 135 to 143 seats. Immediate resistance can be seen at 1.0839 (23.6% fib), an upside break can trigger rise towards 1.0850 (July12th high).On the downside, immediate support is seen at 1.0809(38.2% fib), a break below could take the pair towards 1.0783(50% fib).
GBP/USD: The pound strengthened against the dollar on Monday following the Keir Starmer-led Labour Party's decisive victory over the Rishi Sunak-led Conservative Party in the United Kingdom's parliamentary elections. Labour won one of the largest parliamentary majorities with the second lowest share of the vote of any winning party in modern British history, underscoring how the electoral system favours established parties over smaller ones.With 648 of the 650 seats in parliament's House of Commons declared on Friday, Labour won 412 seats with 9.7 million votes, while the Conservative Party's vote collapsed, giving it 121 seats with 6.8 million votes. Sterling rose 0.1% to $1.2844, its highest since June 12. Immediate resistance can be seen at 1.2845(Daily high), an upside break can trigger rise towards 1.2859(23.6%fib), On the downside, immediate support is seen at 1.2788(38.2%fib), a break below could take the pair towards 1.2732(50% fib).
USD/CAD: The loonie traded flat against its US counterpart on Monday as investors awaited testimony from Federal Reserve Chair Jerome Powell, key inflation data. U.S. jobs data on Friday showed job growth was moderating, firming bets of an interest-rate cut by the Federal Reserve in September. In commodity markets, oil futures settled lower as Hurricane Beryl shut U.S. refineries and ports along the Gulf of Mexico and as hopes for a ceasefire deal in Gaza appeared to reduce concerns about global crude supply disruptions. Markets will closely assess Fed Chair Jerome Powell's comments during his semi-annual testimony, alongside the U.S. Consumer Price Index (CPI) reading, expected later this week. Immediate resistance can be seen at 1.3659 (38.2%fib), an upside break can trigger rise towards 1.3710 (23.6%fib).On the downside, immediate support is seen at 1.3622 (50%fib), a break below could take the pair towards 1.3582 (61.8%fib).
USD/JPY: The U.S. dollar was little changed against yen on Monday as investors digested Friday's jobs report in the U.S. and added to the case for a September rate cut from the Federal Reserve.Data last week pointed to a slackening labour market that keeps the U.S. central bank on course to start cutting interest rates soon.Markets are currently pricing in a 72% chance of the Fed cutting interest rates in September as well as another cut in December.This week investors' focus will be on Fed Chair Jerome Powell's semi-annual Congressional testimony, comments from a series of Fed officials, and U.S. inflation data. The dollar index , which measures the U.S. currency against the euro, sterling, yen and three other major rivals, was flat at 104.95, stabilising after a near 1% slump last week. Strong resistance can be seen at 161.33(23.6%fib), an upside break can trigger rise towards 162.38(Higher BB%).On the downside, immediate support is seen at 160.38 (38.2% fib), a break below could take the pair towards 158.49(50%fib).
Equities Recap
European shares were muted on Monday as investors mulled chances of a hung parliament in France after the left alliance's unexpected advance in the election, while weak energy shares were a drag.
UK's benchmark FTSE 100 closed down by 0.13 percent, Germany's Dax ended down by 0.13 percent, France’s CAC finished the day down by 0.63percent.
The S&P 500 and Nasdaq notched record-high closes on Monday as investors awaited fresh inflation data, commentary from Federal Reserve Chair Jerome Powell and the start of quarterly earnings season.
Dow Jones closed down by 0.08% percent, S&P 500 closed up by 0.10% percent, Nasdaq settled up by 0.27% percent.
Commodities Recap
Gold prices fell more than 1% on Monday, hurt by a risk-on rally in equities and profit-taking by investors after a sharp rally in the previous session over expectations that the U.S. Federal Reserve could cut interest rates in September.
Spot gold was down 1.4% to $2,357.88 per ounce as of 2:04 p.m. ET (1804 GMT), after rising to its highest level since May 22 on Friday. U.S. gold futures settled 1.4% lower to $2,363.50
Oil futures settled lower as Hurricane Beryl shut U.S. refineries and ports along the Gulf of Mexico and as hopes for a ceasefire deal in Gaza appeared to reduce concerns about global crude supply disruptions.
U.S. crude settled down 1%, or 83 cents, at $82.33 a barrel and Brent finished at $85.75 per barrel, down 0.9% or 79 cents on the day.
