Market Roundup
• US Initial Jobless Claims, 221k, 220k forecast,, 229k previous
• US Continued Jobless Claims, 1.686 mln, 1.675 mln forecast, 1.694 mln previous
• US Jun Factory Orders MM,-0.7%, -0.6% forecast, -1.2% previous
• US Jan Durables Ex-Transport R MM, 0.1%, -0.2% previous
• US Jun ADP National Employment, 102k, 140k forecast 41k previous
• US Jun ISM N-Mfg PMI, 58.2, 60 forecast, 61.2 previous
• CA Jan Trade Balance C$, -55.50 bln, -53.20 bln forecast, -51.20bln previous
• CA Jan Exports C$, 53.11 bln, 50.75 bln previous
• CA Jan Imports C$, 52.34 bln, 52.10 bln forecast, 51.84 bln previous
Looking Ahead - Economic Data (GMT)
• 07:00 May Australia Retail Sales, -0.1% previous
Looking Ahead - Events, Other Releases (GMT)
• No major events are scheduled
Currency Summaries
EUR/USD: The euro was little changed against the U.S. dollar on Wednesday, as initial enthusiasm over the latest U.S.-China trade truce was overtaken by fresh concerns over Washington’s threat of tariffs on additional European goods kept investors cautious. The common currency briefly got a lift on Tuesday after a media report that the European Central Bank was in no rush to cut rates at the July meeting. But it later slipped after IMF Managing Director Christine Lagarde, perceived as a policy dove, was nominated as the next ECB president.AT (GMT 19:02), the euro was last trading down 0.06 percent at $1.1278. Immediate resistance can be seen at 1.1316 (5 DMA), an upside break can trigger rise towards 1.1398 (June 28th high).On the downside, immediate support is seen at 1.1232 (50 DMA), a break below could take the pair towards 1.1200 (Psychological level).
GBP/USD: Sterling declined against the dollar on Wednesday, after the release of data that showed the UK's services sector struggled in June. Britain’s economy appears to have shrunk for the first time since late 2012 between April and June as worries about Brexit were compounded by global trade tensions, a closely watched survey showed on Wednesday. A day after Bank of England Governor Mark Carney warned of the growing risks from a no-deal Brexit and protectionist trade policies, a gauge of Britain’s huge services industry the IHS Markit/CIPS services Purchasing Managers’ Index (PMI) slipped to 50.2 in June, just above the no-growth level of 50.Sterling was last trading at $1.2578, down 0.11 percent on the day. Immediate resistance can be seen at 1.2633 (5 DMA), an upside break can trigger rise towards 1.2659 (21 DMA).On the downside, immediate support is seen at 1.2555 (23.6% retracement level), a break below could take the pair towards 1.2500 (Psychological level).
USD/CAD:The Canadian dollar strengthened against its U.S. counterpart on Wednesday, approaching a near eight-month high notched last week, as oil prices rose and as domestic data showed a surprise swing in the trade balance to a surplus in May. Rising exports of motor vehicles, aircraft and energy products helped Canada post a C$762 million trade surplus in goods in May, Statistics Canada reported. Analysts had forecast a shortfall of C$1.50 billion, while April’s deficit was revised slightly wider to C$1.08 billion. The price of oil, one of Canada’s major exports, rebounded after a steep fall in the previous session as OPEC and its allies’ decision to extend output cuts was not enough to counter investors’ concerns about the slowing global economy. U.S. crude oil futures CLc1 were up 1.3% at $56.99 a barrel. The Canadian dollar was last trading 0.30 percent higher at 1.3067 to the greenback. Immediate resistance can be seen at 1.3150(11 DMA), an upside break can trigger rise towards 1.3245 (21 DMA).On the downside, immediate support is seen at 1.3047(38.2 retracement), a break below could take the pair towards 1.3000 (Psychological level).
USD/JPY: The dollar declined to hit 1-week low against the Japanese yen on Wednesday, as declining U.S. Treasury bond yields and fading optimism over the China-U.S. trade deal increased demand for safe haven Japanese yen. U.S. economic reports on Wednesday were mixed and did not really change the dollar's trading direction. The dollar was 0.02 percent lower versus the Japanese yen at 107.86. Strong resistance can be seen at 108.53 (July 1st high), an upside break can trigger rise towards 109.22 (50 DMA).On the downside, immediate support is seen at 107.78 (50 % retracement level), a break below could take the pair towards 107.57 (61.8 % retracement level).
Equities Recap
Euro zone stocks surged on Wednesday as investors piled into firms with big dividends on hopes European Central Bank chief nominee Christine Lagarde will maintain the ECB’s dovish stance, while Italian shares jumped over 2% on avoiding a EU sanction threat.
UK's benchmark FTSE 100 closed up by 0.66 percent, Germany's Dax ended up by 0.71 percent, France’s CAC finished the day up by 0.75 percent.
U.S. stocks rose on Wednesday, with each of the major indexes closing at a record high, as expectations grew that the Federal Reserve would take a more dovish turn as a raft of data provided more evidence of a slowing economy.
Dow Jones closed up by 0.67 percent, S&P 500 ended up by 0.76 percent, Nasdaq finished the down up by 0.75 percent.
Treasuries Recap
U.S. Treasury yields fell on Wednesday with 10-year yields hitting their lowest in over 2-1/2 years as euro zone yields tumbled on record lows on bets the European Central Bank's next chief would stay a dovish course to help the euro zone economy.
Benchmark 10-year Treasury yields were down 2.40 basis points at 1.953%. They touched 1.939% earlier, which was the lowest since November 2016, as 10-year German bund yields reached a record low at -0.399%.
Commodities Recap
Oil prices edged higher on Wednesday ahead of a U.S. holiday after a steep fall the previous session when worries about a slowing global economy outweighed a decision by OPEC and allies to extend crude output cuts.
September Brent crude futures were up $1.22, or 2%, at $63.62 a barrel by 1:32 p.m. ET (1732 GMT).U.S. crude futures for August delivery were up 79 cents, or 1.4%, at $57.04 a barrel
Gold steadied on Wednesday, paring earlier gains as a rally in equities reduced the attraction of the non-yielding metal, while global growth concerns and prospects for dovish monetary policy kept bullion supported.
Spot gold was $1,416.07 per ounce as of 12:12 p.m. EDT (1612 GMT), off its highest level since June 25 of $1,435.99.
