Market Roundup
•Canada S&P Global Manufacturing PMI (Jan): 50.4, 48.6 previous.
•US S&P Global Manufacturing PMI (Jan): 52.4, 51.9 forecast, 51.9 previous.
•US ISM Manufacturing PMI (Jan): 52.6, 48.5 forecast, 47.9 previous.
•US ISM Manufacturing Employment (Jan): 48.1, 46.0 forecast, 44.8 previous.
•US ISM Manufacturing Prices (Jan): 59.0, 59.3 forecast, 58.5 previous.
•US ISM Manufacturing New Orders Index (Jan): 57.1, 47.4 previous.
•US Atlanta Fed GDPNow (Q4): 4.2%, 4.2% forecast, 4.2% previous.
•US 3-Month Bill Auction: 3.600%, 3.580% previous.
•US 6-Month Bill Auction: 3.525%, 3.525% previous.
Looking Ahead Economic Data (GMT)
• 00:30 Australia Building Approvals (MoM) (Dec): -6.4%, 15.2% previous.
• 00:30 Australia Building Approvals (YoY) (Dec): 20.2% previous.
• 00:30 Australia Business Inventories (MoM) (Q4): -0.9% previous.
• 00:30 Australia Private House Approvals (Dec): 1.3% previous.
• 03:30 Australia RBA Interest Rate Decision (Feb) 3.85% forecast, 3.60% previous.
Looking Ahead Events And Other Releases (GMT)
• 04:30 Australia RBA Rate Statement
• 04:30 RBA Monetary Policy Statement
•Currency Summaries
EUR/USD : The euro dipped on Monday as dollar firmed as investors assessed what a Federal Reserve under Kevin Warsh might look like. Moves in currencies were fairly insulated from a broader market rout triggered by a plunge in gold and silver which spilled over into equity markets, as investors were left selling positions in profitable trades to meet margin calls. Market pricing remains at two Fed cuts for this year, with a move seen unlikely until June, when Warsh would be chair if confirmed by the Senate. Investors also looked to the ECB's meeting later this week. While Europe's central bank is widely expected to keep interest rates unchanged, markets will be watching closely for signs as to how the euro's recent strength could affect policy-making going forward. Immediate resistance can be seen at 1.1872(38.2%fib), an upside break can trigger rise towards 1.1966(23.6%fib).On the downside, immediate support is seen at 1.1782 (50%fib), a break below could take the pair towards 1.1746(LSMA 20).
GBP/USD: The pound edged lower on Monday as the dollar firmed as investors assessed the outlook for a Federal Reserve under Kevin Warsh.U.S. President Donald Trump's pick of Warsh as the next Fed chair sparked a wave of selling across risky assets and sent precious metals tumbling on Friday, while the dollar clawed back its losses from earlier last week.While investors think Warsh will be inclined to cut rates, they expect him to rein in the Fed's balance sheet, which is typically supportive for the dollar as it reduces the money supply in the market. Market pricing remains at two Fed cuts for this year, with a move seen unlikely until June, when Warsh would be chair if confirmed by the Senate. Immediate resistance can be seen at 1.3732(38.2%fib), an upside break can trigger rise towards 1.3821(KJan 29th high).On the downside, immediate support is seen at 1.3624(50%fib), a break below could take the pair towards 1.3553(Lower BB).
USD/CAD: The Canadian dollar weakened on Monday as softer commodity prices and a stronger U.S. dollar weighed on loonie. The dollar gained broadly against major currencies on Monday as a selloff in precious metals sparked a flight to safety. Spot gold, which had also touched a record high on Thursday, was down 3.85% at $4,676.28 an ounce. Spot silver fell 3.3% to $81.75 an ounce, after sliding as much as 15% earlier in the session. Silver has dropped roughly 32% since hitting a record high of $121.64 last week. Crude oil futures settled down more than 4% on hopes for a de-escalation of tensions between the U.S. and the OPEC member, while a stronger dollar and milder weather forecasts also weighed. Immediate resistance can be seen at 1.3705 (Daily high), an upside break can trigger rise towards 1.3772(50%fib).On the downside, immediate support is seen at 1.3649(38.2%fib), a break below could take the pair towards 1.3513(Lower BB).
USD/JPY: The U.S. dollar firmed against yen on Monday as greenback was supported by a strong January ISM manufacturing PMI print . U.S. factory activity grew for the first time in a year in January as businesses placed new orders after the holiday season, but the improvement was likely temporary, with manufacturers still complaining about the uncertainty wrought by a fluid trade policy.The ISM said its manufacturing Purchasing Managers Index rebounded to 52.6 last month. It was the first time in 12 months that the PMI was above 50 and the highest reading since August 2022, indicating growth in manufacturing, which accounts for 10.1% of the economy.The PMI was at 47.9 in December, and had been in contraction territory for 10 straight months. Economists polled by Reuters had forecast the PMI would rise to 48.5. Immediate resistance can be seen at 154.14(50%fib) an upside break can trigger rise towards 156.55(SMA 20) .On the downside, immediate support is seen at 154.09(61.8%fib) a break below could take the pair towards 152.46 (Lower BB).
Equities Recap
The STOXX 600 index hit a record high on Monday, driven by strong gains in financial and healthcare stocks as investors brushed aside commodity market volatility ahead of a busy earnings week.
UK's benchmark FTSE 100 closed up by 1.15 percent, Germany's Dax ended up by 1.05 percent, France’s CAC finished the day up by 0.67 percent.
The S&P 500 ended higher on Monday, boosted by gains in chipmakers and other AI-related stocks, while smaller companies also posted strong advances.
Dow Jones closed down by 1.05 % percent, S&P 500 closed up by 0.54 % percent, Nasdaq settled up by 0.56% percent
Commodities Recap
Gold extended losses on Monday, pressured by higher CME margin requirements and last week’s sharp selloff after Kevin Warsh was nominated as the next Federal Reserve chair..
Spot gold was down 4.8% at $4,630.59 an ounce by 01:32 p.m. ET (1832 GMT), after tumbling nearly 10% earlier in the session. U.S. gold futures for April delivery settled 1.9% lower at $4,652.60 an ounce.
Oil prices dropped more than $3 a barrel on Monday after President Donald Trump said Iran was “seriously talking” with Washington, signaling easing tensions with the OPEC member, while a stronger dollar and milder weather forecasts added pressure.
Brent crude futures fell $3.02, or 4.4%, to settle at $66.30 per barrel, while U.S. West Texas Intermediate crude futures fell $3.07, or 4.7%, to $62.14 per barrel.
