Market Roundup
- EUR/USD 0.29%, USD/JPY -0.05%, GBP/USD -0.09%, EUR/GBP 0.4%
- DXY -0.13%, DAX -0.76%, FTSE 0.01%, Brent 0.64%, Gold 0.01%
- EZ Jun Economic Sentiment, 112.3, 112.0 forecast, 112.5 previous
- EZ Jun Business Climate, 1.39, 1.40 forecast, 1.45 previous
- EZ Jun Industrial Sentiment, 6.9, 6.4 forecast, 6.8 previous
- EZ Jun Services Sentiment, 14.4, 14.2 forecast, 14.3 previous
- EZ Jun Consumer Confidence Final, -0.5, -0.5 forecast, 0.2 previous
- EZ Jun Cons Inflation Expectations, 17.5, 17.5 previous
- Germany Jul Gfk Consumer Sentiment, 10.7, 10.6 forecast, 10.7 previous
- BoE's Cunliffe keeps cards close on rates outlook – BBC
- ECB sees rising risks to global growth
- BOJ's Wakatabe sees no need to adjust policy to counter side-effects of YCC
Economic Data Ahead
- (0830 ET/1230 GMT) The number of Americans filing for unemployment benefits is likely to have increased by 2,000 to a seasonally adjusted 220,000 for the week ended Jun. 22, while continuing claims for the week ended Jun. 15 is expected to rise to 1.725 million from a previous reading of 1.723 million.
- (0830 ET/1230 GMT) The U.S. Commerce Department is expected to report that gross domestic product increased at a 2.2 percent annual rate in the first quarter.
- (0830 ET/1230 GMT) The U.S. Commerce Department releases the personal consumption expenditures (PCE) price index for the first quarter. The index is expected to rise 2.6 percent, while core PCE is likely to increase 2.3 percent.
- (1030 ET/1430 GMT) The Energy Information Administration (EIA) reports its Natural Gas Storage for the week ending June 22.
- (1100 ET/1500 GMT) Federal Reserve Bank of Kansas City issues manufacturing activity index for the month of June. The indicator stood at 41 in the previous month.
Key Events Ahead
- (0930 ET/1330 GMT) Bank of England MPC Member Andrew G Haldane speaks in London
- (1045 ET/1445 GMT) Federal Reserve Bank of St. Louis President James Bullard participates in moderated discussion on the U.S. economy and monetary policy before the Ascension Health Management Annual Conference, in St. Louis.
- (1200 ET/1600 GMT) Federal Reserve Bank of Atlanta President Raphael Bostic participates in a community conversation, co-partnered by Fed Up Coalition and the Federal Reserve Bank of Atlanta, in Atlanta.
FX Beat
DXY: The dollar index slightly eased after rising to a 1-year peak earlier in the day amid confusion about Washington's trade intentions. The greenback against a basket of currencies trades 0.1 percent down at 95.18, having touched a high of 95.53 earlier in the session, its highest since July 2017. FxWirePro's Hourly Dollar Strength Index stood at 56.44 (Bullish) by 1100 GMT.
EUR/USD: The euro rebounded after falling to a 1-week low earlier as investors positioned for a potentially divisive European Union summit. Investors seem to have ignored soft Eurozone economic sentiment, which declined in June as consumers and managers in the construction sector became more downbeat. The European currency traded 0.3 percent up at 1.1591, having touched a high of 1.1719 on Tuesday, its highest since June 14. FxWirePro's Hourly Euro Strength Index stood at 24.31 (Neutral) by 1100 GMT. Immediate resistance is located at 1.1632 (5 DMA), a break above targets 1.1676 (21-DMA). On the downside, support is seen at 1.1598 (June 22 Low), a break below could drag it till 1.1530 (June 19 Low).
USD/JPY: The dollar declined, reversing early session gains, amid conflicting signals about developments in the trade war between Washington and its business partners. The major was trading 0.05 percent down at 110.20, having hit a low of 109.36 on Tuesday, its lowest since June 11. FxWirePro's Hourly Yen Strength Index stood at 26.19 (Neutral) by 1100 GMT. Investors’ will continue to track broad-based market sentiment, ahead of the U.S. unemployment benefit claims, gross domestic product, personal consumption expenditure prices and Fed Bullard and Bostic's speech. Immediate resistance is located at 110.90 (June 15 High), a break above targets 111.08 (June 18 High). On the downside, support is seen at 109.55 (June 19 Low), a break below could take it lower 109.19 (June 8 Low).
GBP/USD: Sterling slumped to a 7-1/2 month low against the dollar, as growing Brexit uncertainties continued to exert pressure for the third straight session. The major traded 0.1 percent down at 1.3092, having hit a low of 1.3066 earlier; it’s lowest since Nov. 14. FxWirePro's Hourly Sterling Strength Index stood at -111.39 (Highly Bearish) 1100 GMT. Immediate resistance is located at 1.3200, a break above could take it near 1.3296 (21-DMA). On the downside, support is seen at 1.3061 (Nov. 13 Low), a break below targets 1.3027 (Oct. 6 Low). Against the euro, the pound was trading 0.4 percent down at 88.49 pence, having hit a low of 88.55 pence earlier in the day, it’s lowest since March 15.
USD/CHF: The Swiss franc slumped to multi-week lows as the greenback rallied after White House economic adviser Larry Kudlow stated that Trump's announced plan did not indicate a softened stance on China. The major trades 0.05 percent up at 0.9973, having touched a high of 0.9992, it’s highest since May 21. FxWirePro's Hourly Swiss Franc Strength Index stood at 41.88 (Neutral) by 1100 GMT. On the higher side, near-term resistance is around 1.0018 (May 18 High) and any break above will take the pair to next level till 1.0056. The near-term support is around 0.98932 (10-DMA) and any close below that level will drag it till 0.9898 (21-DMA).
Equities Recap
European shares slumped, weighed down by trade tensions and political concerns, while euro steadied as investors positioned for a potentially divisive European Union summit.
The pan-European STOXX 600 index plunged 0.4 percent at 378.38 points, while the FTSEurofirst 300 index eased 0.4 percent to 1,480.48 points.
Britain's FTSE 100 trades 0.1 percent rose at 7,623.01 points, while mid-cap FTSE 250 fell 0.4 percent to 20,760.75 points.
Germany's DAX declined 0.7 percent at 12,262.71 points; France's CAC 40 trades 0.4 percent lower at 5,308.13 points.
Commodities Recap
Crude oil prices rallied to multi-week peaks, while U.S. crude steadied near 3-1/2-year highs, as supply remained tight with investors concerned by the prospect of a huge drop in crude exports from Iran due to U.S. sanctions. International benchmark Brent crude was trading 0.9 percent up at $78.01 per barrel by 1024 GMT, having hit a high of $78.14 earlier, its highest since May 31. U.S. West Texas Intermediate was trading 0.8 percent up at $72.81 a barrel, after rising as high as $73.03 on Wednesday, its highest since Nov. 2014.
Gold prices declined, touching their lowest level in more than 6-months as the greenback held near 1-year highs amid mounting U.S.-China trade war tensions. Spot gold was 0.05 percent down at $1,251.32 an ounce by 1027 GMT, having touched a low of $1,248.25 earlier, its lowest since mid-December. U.S. gold futures GCcv1 for August delivery dropped 0.4 percent at $1,251.20 an ounce.
Treasuries Recap
The German bunds remained tad higher during European session ahead of the country’s consumer price inflation (CPI) data for the month of June and unemployment data for the similar period, scheduled to be released later today and on June 28 by 07:55GMT respectively. The German 10-year bond yields, which move inversely to its price, slipped nearly 1 basis point to 0.31 percent, the yield on 30-year note slid 1 basis point to 1.11 percent and the yield on short-term 3-year hovered around -0.58 percent.
The New Zealand bonds closed on the upper end of the curve as trade war fears continue to bother market participants. At the time of closing, the yield on the benchmark 10-year note, which moves inversely to its price, slumped 4 basis points to 2.87 percent, the yield on the long-term 20-year note plunged 5-1/2 basis points to 3.19 percent and the yield on short-term 2-year closed nearly 2-1/2 basis points lower at 1.85 percent.
The Japanese 10-year government bonds gained during late Asian session after the country’s retail sales for the month of May missed market expectations ahead of a host of 2-tier economic data later today and tomorrow. The yield on Japan’s benchmark 10-year bond, which moves inversely to its price, slipped 1/2 basis point to 0.03 percent, the yield on the long-term 30-year also fell 1/2 basis point to 0.71 percent and the yield on short-term 3-year traded flat at -0.11 percent.
The Australian bonds gained during Asian session tracking similar movement in the United States counterpart as trade war fears continued to linger on ahead of the Reserve Bank of Australia’s (RBA) monetary policy meeting, scheduled to be held by early next week. The yield on Australia’s benchmark 10-year Note, which moves inversely to its price, slipped nearly 1 basis point to 2.63 percent, the yield on the long-term 30-year Note plunged nearly 4 basis points to 3.09 percent and the yield on short-term 2-year traded nearly 2 basis points lower at 2.00 percent.
