Market Roundup
• US Jun Core Durable Goods Orders (MoM) , 1.2%, 0.2% forecast, 0.5% previous
• US Jun Durable Goods Orders (MoM) , 2.0%, 0.8% forecast, -2.3% previous
• US Jun Durables Excluding Defense (MoM) 3.1%, -1.2% previous
• US June Goods Trade Balance - 74.17B, -72.40B forecast, -74.55B previous
• US Initial Jobless Claims 206K, 220K forecast 216K
• US Jobless Claims 4-Week Avg 213.00K, 218.75K previous
• US Wholesale Invt(y), R MM, 1.2%, 0.2% forecast
• Russia Central Bank Reserves 520.3B, 519.7B previous
• US July KC Fed Composite Index -1, 4 previous
• US July KC Fed Manufacturing Index -6, -3 previous
• Brazil Foreign direct investment -2.20B, 5.75B forecast, 7.10B previous
Looking Ahead - Economic Data (GMT)
• 23:30 Japan July Tokyo Core CPI (YoY), 0.8% forecast, 0.9% previous
• 23:30 Japan July Tokyo CPI (YoY) 1.0% forecast,1.1% previous
• 23:30 Japan July Tokyo CPI Ex Food and Energy (MoM) -0.1% previous
Looking Ahead - Events, Other Releases (GMT)
• No Significant Events
Currency Summaries
EUR/USD: The euro rose against the U.S. dollar on Thursday, after the European Central Bank failed to deliver an interest rate cut that some investors had expected and after its president Mario Draghi offered a glimmer of optimism about his outlook on the euro zone economy. The euro recovered after the ECB, which kept interest rates unchanged, said in its statement rates would stay “at their present or lower levels” and opened the door for more quantitative easing.Despite Thursday’s gains, the euro’s outlook remained downbeat due to the prospect of further monetary easing.The euro was down 0.04 percent at $1.1141. An index that tracks the dollar versus a basket of six major currencies was up 0.12 at 97.80. Immediate resistance can be seen at 1.1173 (5 DMA), an upside break can trigger rise towards 1.1215 (11 DMA).On the downside, immediate support is seen at 1.1126 (July 24th low), a break below could take the pair towards 1.1100 (Psychological level).
GBP/USD: Britain's pound was little changed against greenback on Thursday, after new Prime Minister Boris Johnson filled his cabinet with Brexiteers and promised he would take Britain out of the European Union on Oct. 31 with or without a transition deal. Johnson’s victory was largely priced into sterling. Attention now turns to whether Johnson will stick to his rhetoric about trying to extract more concessions from the EU and taking Britain out of the EU in October without a trade deal if he can’t get them. Johnson will meet his Brexiteer-dominated team of senior ministers for the first time today to discuss how to persuade the EU to agree to a new Brexit deal. Immediate resistance can be seen at 1.2525 (21 DMA), an upside break can trigger rise towards 1.2607 (50 DMA).On the downside, immediate support is seen at 1.2400 (Psychological level), a break below could take the pair towards 1.2348 (Lower Bollinger Band).
USD/CAD:The Canadian dollar edged higher on Thursday against its U.S. counterpart, as oil prices rose and data that showed domestic average weekly earnings rose in May at the fastest pace in 15 months. Average weekly earnings of non-farm payroll employees were up 3.4% from the previous year, the highest year-over-year growth rate since February 2018, data from Statistics Canada showed. At (2023 GMT), the Canadian dollar was trading 0.16% higher at 1.3157 to the greenback. The currency, which hit its weakest intraday level in nearly one month at 1.3164 on Tuesday, traded in a range of 1.3115 to 1.3153.Immediate resistance can be seen at 1.3177 (Higher Bollinger Band), an upside break can trigger rise towards 1.3250 (50 DMA).On the downside, immediate support is seen at 1.3089 (9 DMA), a break below could take the pair towards 1.3000 (Psychological level).
USD/JPY: The dollar strenthed against Japanese yen on Thursday, as robust U.S. economic data boosted greenback across the board. Weekly U.S. jobless claims number fell to a three-month low last week, pointing to strength in the labor market, while new orders for key U.S. made capital goods surged 1.9 % in June. Market participants are now looking ahead to the U.S. central bank's July 30-31 monetary policy meeting where it is expected to trim its interest rate by at least 25 basis points.The dollar was last trading 0.45 higher versus the Japanese yen at 108.66. Strong resistance can be seen at 108.98 (July 10th high), an upside break can trigger rise towards 109.63 (31st May high).On the downside, immediate support is seen at 108.14 (21 DMA), a break below could take the pair towards 107.68 (July 22nd low).
Equities Recap
European stock markets turned into a sea of red on Thursday after the European Central Bank signaled monetary policy easing ahead, but disappointed investors who sought more clarity on its action to stimulate a slowing economy.
UK's benchmark FTSE 100 closed down 0.17 percent, Germany's Dax ended down by -1.28 percent, France’s CAC finished the day down by 0.50 percent.
U.S. stocks slid on Thursday after a handful of downbeat earnings pointed to a slowing global economy and as European Central Bank chief Mario Draghi’s comments disappointed investors who were hoping for a more dovish stance.
Dow Jones closed down by 0.47 percent, S&P 500 ended down by 0.53 percent, Nasdaq finished the day down by 1.00 percent.
Treasuries Recap
U.S. Treasury yields rose on Thursday after European Central Bank President Mario Draghi said that the bank sees a low risk of a recession in the euro zone, even as he acknowledged a worsening outlook.
Benchmark 10-year Treasuries were last down 7/32 in price to yield 2.097%. The yields fell to 2.011% immediately after the ECB's statement, the lowest since July 8, and rose as high as 2.100% after Draghi's comments.
Commodities Recap
Gold eased off a one-week peak on Thursday as robust U.S. economic data outweighed the European Central Bank’s decision to hew to an accommodative monetary policy, with investor focus on next week’s Federal Reserve meeting.
Spot gold was down 0.4% at $1,420.80 per ounce as of 10:54 a.m. EDT (1454 GMT). U.S. gold futures fell 0.2% to $1,420.80.
Oil prices edged higher on Thursday supported by rising tensions between the West and Iran and a big decline in U.S. crude stockpiles, but gains were capped due to lingering worries about slowing economic growth that could reduce fuel demand.
Brent crude futures settled 21 cents, or 0.33%, higher at $63.39 a barrel after hitting a session high of $64.23
U.S. West Texas Intermediate crude ended the session up 14 cents, or 0.25%, at $56.02 a barrel, after hitting a session high of $56.99 earlier.
