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America’s Roundup: Dollar slips after soft US economic data, Wall Street closes higher, Oil slumps $3/bbl on gasoline stockpiles, rate hikes and resuming supply-July 22nd ,2022

Market Roundup

•US Jul Philly Fed Prices Paid 52.20, 64.50 previous

•US Jul Philly Fed Employment   19.4, 28.1 previous

•US Jul Philly Fed Business Conditions  -18.6, -6.8 previous

•US Jul Philly Fed New Orders -24.8,-12.4 previous

•US Jul Philadelphia Fed Manufacturing Index  -12.3,2.5 forecast,-3.3 previous

•Canada Jun New Housing Price Index (MoM) 0.2%, 0.3% forecast, 0.5% previous

•US Initial Jobless Claims 251K, 240K forecast, 244K previous

•US Continuing Jobless Claims   1,384K,1,340K forecast, 1,331K previous

•US  Jobless Claims 4-Week Avg  240.50K, 235.75K previous

•US Jun Leading Index (MoM) -0.8%,  -0.5% forecast,-0.4% previous

•US Natural Gas Storage32B, 47B forecast,- 58B previous

•US 4-Week Bill Auction 2.120%,1.980% previous

•US 8-Week Bill Auction 2.230%,.270% previous

Looking Ahead - Economic Data (GMT)

•00:30 Japan Jul Manufacturing PMI  52.7 previous

Looking Ahead - Economic events and other releases (GMT)

•No significant events

Currency Summaries

EUR/USD: The euro initially gained on Thursday, but gave up ground  after the European Central Bank (ECB) delivered a 50 basis points rate hike to tame inflation in its first rate increase since 2011.The ECB raised its benchmark deposit rate to 0%, breaking its own guidance for a 25 basis points move as it joined global peers in jacking up borrowing costs. The euro's initial rally, however, faltered after ECB President Christine Lagarde said the bank was accelerating its exit from negative interest rates but not changing the ultimate point of arrival. The euro was last trading 0.17% higher at $1.0198 after rising as high as 1.0279, its strongest in nearly two weeks. Immediate resistance can be seen at 1.0244(50%fib), an upside break can trigger rise towards 1.0270(21DMA).On the downside, immediate support is seen at 1.0161(38.2%fib), a break below could take the pair towards 1.0048 (23.6%fib).

GBP/USD: The British pound rebounded  against   the dollar on Thursday after the European Central Bank raised interest rates for the first time in more than a decade as it seeks to rein in inflation.The ECB had for weeks flagged a 25 basis point hike, until earlier this week. The central bank also introduced a bond protection plan, called the Transmission Protection Instrument (TPI), that is designed to cap borrowing costs across the region. On Wednesday, the race was whittled down to two candidates, with former finance minister Rishi Sunak and foreign secretary Liz Truss making it through to the last round and set to battle it out over the summer for the votes of Conservative Party members. Immediate resistance can be seen at 1.2045(38.2%fib), an upside break can trigger rise towards 1.2078(38.2%fib).On the downside, immediate support is seen at 1.1922(9DMA), a break below could take the pair towards 1.1789(23.6%fib).

 USD/CAD: The Canadian dollar edged lower against its U.S. counterpart on Thursday, pulling back from a three-week high, as commodity prices slide on recession fears. Oil and metal prices fell as a slowdown worries fueled by central banks' hawkishness weighed on commodities, raising concerns around demand. U.S. September crude futures fell $3.53 to settle at $96.35 a barrel on Thursday. The Bank of Canada raised interest rates by 100 basis points last week in a surprise move, while data on Wednesday showed inflation accelerated again in June but not as sharply as expected. The loonie was trading 0.1% lower at C$1.2896 to the greenback, after trading in a range of 1.2861 to 1.2937.Immediate resistance can be seen at 1.2907(38.2%fib), an upside break can trigger rise towards 1.2967 (10 DMA).On the downside, immediate support is seen at 1.2882(50%fib), a break below could take the pair towards 1.2796 (Lower BB).

USD/JPY: The dollar declined against the Japanese yen on Thursday as unexpectedly high U.S. jobless claims and weak Philly Fed weighed on dollar. The number of Americans enrolling for unemployment benefits rose for a third straight week last week to the highest in eight months and a closely watched gauge of factory activity slumped this month, the newest indications the U.S. economy is slowing under the weight of rising interest rates and high inflation. In the week ended July 16, initial claims for state unemployment benefits rose 7,000 to a seasonally adjusted 251,000, the highest since last November .The latest data are likely to further fan fears of a recession that were already on the rise. Strong resistance can be seen at 137.89 (5DMA), an upside break can trigger rise towards 140.00(Psychological level).On the downside, immediate support is seen at 137.15 (38.2%fib), a break below could take the pair towards 136.26 (30DMA).

Equities Recap

European stocks turned in a mixed performance on Thursday with investors staying largely cautious, reacting to the European Central Bank's first rate hike in 11 years, and amid persisting concerns about slowing growth and rising inflation.

The UK's benchmark FTSE 100 closed up by 0.09 percent, Germany's Dax ended down by 0.27 percent, and France’s CAC finished the up  by 1.11 percent.

Wall Street's main indexes rose on Thursday boosted by a late-afternoon rally and gains in heavyweight growth stocks, including Tesla.

Dow Jones closed up by 0.51 percent, S&P 500 ended up 0.99 percent, Nasdaq finished the day up by 1.36 percent.

Treasuries Recap

U.S. Treasury yields fell on Thursday, with the benchmark 10-year note below 2.9%, weighed by soft economic data and after the first interest rate hike in 11 years by the European Central Bank turned investors' focus toward an economic slowdown.

The two-year   U.S. Treasury yield, which typically moves in step with interest rate expectations, was down 16.5 basis points at 3.085%.

The yield on 10-year Treasury notes   was down 15.9 basis points to 2.877%. The yield on the 30-year Treasury bond   was down 12.2 basis points to 3.048%.

Commodities Recap

Gold bounced off a one-year low on Thursday after gaining more than 1% as the dollar eased and persistent economic concerns boosted bullion’s safe-haven appeal.

Spot gold was up 1% at $1,712.61 per ounce by 1636 GMT, after hitting its lowest since March 2021 at $1,680.25.U.S. gold futures rose 0.6% to $1,711.00.

Oil prices fell more than $3 a barrel on Thursday on higher U.S. gasoline stockpiles and after a European Central Bank (ECB) rate hike stoked demand worries, while returning oil supply from Libya and the resumption of Russia's gas flows to Europe eased supply restraints.

Brent crude futures settled at $103.86 a barrel, falling $3.06, or 2.9%. U.S. West Texas Intermediate crude settled at $96.35 a barrel, declining $3.53, or 3.5%.

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