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America's Roundup: Dollar weakens as Trump nixes N. Korea summit, Wall Street edges lower, Gold jumps, Oil slips further below $80/bbl on talk OPEC may lift output-May 25th,2018

Market Roundp

• Trump scraps North Korea summit, warns Kim that military ready.

• US w/e Initial Jobless Claims, 234k, 220k forecast 222k previous.

• US w/e Continued Jobless Claims, 1.741 mln, 1.754 mln forecast, 1.707 mln previous.

• US w/e Jobless Claims 4-Wk Avg, 219.75k, 213.25k previous.

• US Apr Existing Home Sales, 5.46 mln, 5.57 mln forecast, 5.60 mln previous.

• US Apr Exist. Home Sales % Chg, -2.5%, -0.2% forecast, 1.1% previous.

• US Mar Monthly Home Price MM, 0.1%, 0.6% previous.

• US Mar Monthly Home Price YY, 6.7%, 7.2% previous.

• US Mar Monthly Home Price Index, 261.7, 261.1 previous.

• US May KC Fed Composite Index, 29, 26 previous.

• US May KC Fed Manufacturing, 41, 33 previous.

• Trump signs bill easing U.S. bank rules into law.

• U.S. auto import probe fans tariff fears, riles Asia, Europe.

• Fed could end tightening cycle in 2019 - Harker on CNBC.

• Canada PM raps possible U.S. auto tariffs, says linked to NAFTA.

• U.S. intelligence officials brief lawmakers on Russia probe.

• U.S. targets airlines in latest Iran sanctions move.

Looking Ahead - Economic Data (GMT)

• 24 May 23:30 Japan May CPI Core Tokyo YY, 0.6% forecast, 0.6% previous

• 24 May 23:30 Japan May CPI, Overall Tokyo, 0.5% previous

Looking Ahead - Events, Other Releases (GMT)

• 06:15 Bank of England's Mike Carney, Finland's central bank manager Erkki Liikanen and Fed's Jerome Powell participate in the Riksbank's 350th conference in Stockholm

• 07:00 Bank of France Governor Francois Villeroy to speak about Paris as a financial centre in Paris

• 13:40 ECB's Benoit Coeure participates in a panel at Sveriges Riksbank's 350th anniversary celebration in Stockholm

• 15:45 Atlanta Fed's Bostic, Chicago Fed's Evans and Dallas Fed's Kaplan participate in "Session VIII: Policymaker Panel" before the Federal Reserve Banks of Dallas and Atlanta "Technology-Enabled Disruption: Implications for Business, Labor Markets and Monetary Policy" conference in Dallas

• 18:30 Dallas Fed's Robert Kaplan gives closing remarks before the Federal Reserve Banks of Dallas and Atlanta "Technology-Enabled Disruption: Implications for Business, Labor Markets and Monetary Policy" conference

Currency Summaries

EUR/USD is likely to find support at 1.1673 levels and currently trading at 1.1724 levels. The pair has made session high at 1.1750 and hit lows at 1.1711 levels. The euro edged higher against US dollar on Thursday as the dollar faltered but concerns over an economic slowdown in Europe and political risks in Italy continued to act as a brake. The euro is set to be down for a sixth consecutive week against the dollar -- the longest weekly losing streak since January 2015 hobbled by the surging U.S. currency and worries over a deepening economic slowdown in the currency bloc. The single currency rose to $1.1746, off the low of $1.1676 hit on Wednesday, and was heading for its biggest daily gain in two weeks. But that was largely because the recent dollar rally lost some momentum following dovish-looking minutes of the Federal Reserve's last policy meeting and the threat by U.S. President Donald Trump to impose new tariffs on imported cars. The euro's gains were also capped by economic and political worries in Europe. The leader of the far-right League, a partner in Italy's planned coalition government, insisted on Thursday that eurosceptic economist Paolo Savona should be named economy minister. The European Central Bank's chief economist said on Thursday there are "clouds" on the horizon, including plans by Italy's would-be government to loosen fiscal policy and roll back a pension reform, and international trade tension.

GBP/USD is supported in the range of 1.3300 levels and currently trading at 1.3384 levels. It reached session high at 1.3413 and dropped to session low at 1.3363 levels. Britain's pound edged below the day's highs against the dollar on Thursday as upbeat British retail sales data failed to push the currency further as concerns over Brexit negotiations weighed on investors sentiment. The British currency extended gains to rise half a percent on the day at $1.3419 compared to $1.3385 earlier as retail sales volumes rose by 1.6 percent from March, well above the median forecast for a monthly 0.7 percent increase in a poll of economists. But it subsequently trimmed early gains to stand 0.2 percent up on the day at $1.3384.The currency's gains on Thursday marked a reversal of fortunes from Wednesday when it fell to its lowest levels since mid-December on a slower than expected pickup in inflation. Sterling's gains were also magnified by the dollar's weakness which was down a quarter of a percent against a basket of its rivals after U.S. President Donald Trump called off his planned June 12 summit meeting with North Korean leader Kim Jong Un. However, on a trade-weighted basis, sterling was trading near its lowest levels in two weeks.

USD/CAD is supported at 1.2819 levels and is trading at 1.2885 levels. It has made session high at 1.2920 and lows at 1.2870 levels. The Canadian dollar weakened against its U.S. counterpart on Thursday as oil prices fell and investors weighed the potential imposition of U.S. tariffs on car imports. The Trump administration has launched a national security investigation into car and truck imports that could lead to new U.S. tariffs, similar to those imposed on imported steel and aluminum in March. The investigation comes as the United States renegotiates the North American Free Trade Agreement with Canada and Mexico to return more auto production to the United States. Canada is a major exporter of autos to the United States so its economy could be hurt by U.S. auto tariffs or failure to reach a deal on NAFTA. Oil is also one of Canada's major exports. Its price fell by the most in two weeks as expectations rose that OPEC will end an output deal that has been in place since the start of 2017. The Canadian dollar was last trading 0.3 percent lower at C$1.2885 to the greenback. The currency traded in a range of C$1.2842 to C$1.2920. On Wednesday, it touched its weakest in more than one week at C$1.2916.

USD/JPY is supported around 108.80 levels and currently trading at 109.27 levels. It peaked to hit session high at 109.74 and made session lows at 108.94 levels. The U.S. dollar declined against the yen on Thursday after U.S. President Donald Trump called off a summit meeting with North Korean leader Kim Jong Un and as traders booked profits following the greenback's recent rally. Trump called off the planned June 12 summit meeting with the North Korean leader even after North Korea followed through on a pledge to blow up tunnels at its nuclear test site. It was a sudden end to weeks of optimistic statements from Trump that by meeting with Kim he might succeed where previous U.S. presidents had failed and persuade North Korea to give up a nuclear weapons program that now threatens the United States. Earlier on Thursday, North Korea had repeated its threat to pull out of the summit and warned it was prepared for a nuclear showdown with Washington if necessary. The yen, which tends to rise in times of market turbulence, hit to a two-week high against the greenback. The dollar was down 0.81 percent at 109.27 yen. The dollar index, which measures the greenback against a basket of six other currencies, was down 0.25 percent at 93.766. Despite the weakness on Thursday, the index is up about 2 percent for the month, on pace for its second straight month of gains.

Equities Recap

European stocks fell on Thursday as carmaker shares came under pressure after the United States launched an investigation into auto imports, while Deutsche Bank  dropped after announcing thousands of job cuts.

The UK's benchmark FTSE 100 closed down by 0.65 percent, FTSEurofirst 300 ended the day down by 0.53 percent, Germany's Dax ended down by 1 percent, and France’s CAC finished the down by 0.22 percent.

U.S. stocks ended down slightly on Thursday after President Donald Trump canceled a planned summit with North Korea's Kim Jong Un and ordered a probe of auto imports, while gains in Netflix pushed its market value to a record.

Dow Jones closed down by 0.32 percent, S&P 500 ended down 0.21 percent, Nasdaq finished the day up by 0.03 percent.

Treasuries Recap

U.S. Treasury yields fell on Thursday on safety buying after President Donald Trump called off a planned summit with North Korean leader Kim Jong Un and as the Turkish lira renewed its decline.

Benchmark 10-year notes gained 7/32 in price to yield 2.979 percent, down from 3.003 percent late on Wednesday.

Commodities Recap

Gold prices surged on Thursday, propelled above $1,300 per ounce as the U.S. dollar faded after U.S. President Donald Trump called off a summit with North Korea, stoking political tensions.

Spot gold gained 0.9 percent at $1,305.18 per ounce by 1:34 p.m. EDT (1734 GMT), earlier hitting $1,306.56, a nine-day high. U.S. gold futures for June delivery settled up $14.80, or 1.2 percent, at $1,304.40 per ounce.

Oil prices fell about $1 on Thursday, with expectations building that reduced supplies from Venezuela and Iran could prompt OPEC to wind down output cuts in place since the start of 2017.

Brent crude futures fell $1.01 to settle at $78.79 a barrel, a 1.27 percent loss. U.S. West Texas Intermediate (WTI) crude futures fell $1.13 to settle at $70.71 a barrel, a 1.57 percent loss.

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