Market Roundup
•Canada Apr Housing Starts 261.6K, 224.6K forecast, 213.9K previous
•US May NY Empire State Manufacturing Index -31.80,-3.70 forecast, 10.80 previous
•Canada Mar Wholesale Sales (MoM) 46.0%, -0.4% forecast, -1.7% previous
•French 6-Month BTF Auction 3.128%, 3.205% previous
•French 12-Month BTF Auction 3.249%, 3.215% previous
•French 3-Month BTF Auction 3.121%, 3.079% previous
Looking Ahead Economic Data(GMT)
•02:00 China Apr Chinese Industrial Production YTD (YoY) 3.0% previous
•02:00 China Apr Chinese Retail Sales YTD (YoY) 5.76% previous
•02:00 China Apr Industrial Production (YoY) 10.9% forecast, 3.9% previous
•02:00 China Apr Chinese Unemployment Rate 5.3% forecast, 5.3% previous
•02:00 China Apr Retail Sales (YoY) 21.0% forecast,10.6% previous
•02:00 China Apr Fixed Asset Investment (YoY) 5.5% forecast, 5.1% previous
Looking Ahead events And Other Releases(GMT)
•01:30 Australia RBA Meeting Minutes
Currency Forecast
EUR/USD: The euro edged higher on Monday as investors cautiously awaited news from Washington on how to address the debt ceiling issue, which could force the U.S. government to default on its debt if not resolved.The dollar's decline on Monday came after it notched its best weekly performance on Friday since September last year. The dollar index , which measures the greenback's value against six major currencies, fell 0.3% to 102.40. Earlier in the session, the dollar touched a five-week high of 102.75. The euro was up 0.2% against the dollar at $1.087. Immediate resistance can be seen at 1.0950(5DMA), an upside break can trigger rise towards 1.0977(23.6%fib).On the downside, immediate support is seen at 1.0844 (Daily low ), a break below could take the pair towards 1.0818(Lower BB).
GBP/USD: The pound rose on Monday, heading back towards multi-month highs against both the euro and the dollar, a day before important wage data that will guide the Bank of England's future rate policy plans.Sterling rose 0.46% against the dollar to $1.2505. It hit a one-year high of $1.2679 last week, before dropping sharply as the dollar rebounded across the board, with signs of slowing global growth pushing investors to the safety of the U.S. currency. Tuesday's employment data is the main event for the British currency this week, as the Bank of England is worried that recent strong headline pay growth could turn into a long-lasting problem for the economy, due to its effect on inflation. Immediate resistance can be seen at 1.2576 (5DMA), an upside break can trigger rise towards 1.2616 (23.6%fib).On the downside, immediate support is seen at 1.2496(38.2%fib), a break below could take the pair towards 1.2439(May 1st low).
USD/CAD: The Canadian dollar fell against its U.S. counterpart on Monday as oil prices gained and greenback weakened across the board. Canadian wholesale trade grew by 0.1% in March. Canadian housing starts in Aprilrose more than expected to 261,600.00000000003 units from a revised 213,800 units the previous month, the Canadian Mortgage and Housing Corporation (CMHC) said. A survey of 11 economists polled by had forecast April housing starts rising to 220,000 units. The loonie was trading 0.6% higher at C$1.3469 to the greenback, or 74.24 U.S. cents, after trading in a range of 1.346 to 1.3567. Immediate resistance can be seen at 1.3508 (38.2%fib), an upside break can trigger rise towards 1.3568(23.6%fib).On the downside, immediate support is seen at 1.3440(50%fib), a break below could take the pair towards 1.3411 (61.8%fib).
USD/JPY: The dollars strengthened against Japan's yen on Monday as investors remained wary of the U.S. debt ceiling standoff that could fuel worries of a global economic slowdown.. Recent downside surprises in U.S. economic data have lifted the chances of a recession over the next 12 months . Data on Friday showed U.S. consumer sentiment slumped to a six-month low in May on worries that political haggling over raising the federal government’s borrowing cap could trigger a recession.The dollar was up 0.3% at 136.06 against the yen. Strong resistance can be seen at 136.22(23.6%fib) an upside break can trigger rise towards 136.89(psychological level).On the downside, immediate support is seen at 135.34(5DMA), a break below could take the pair towards 135.05(38.2%fib)
Equities Recap
European stocks climbed on Monday as investors assessed uncertainties around U.S. debt ceiling talks and a runoff election in Turkey, while parsing data for clues on the state of the global economy.
UK's benchmark FTSE 100 closed up by 0.30 percent, Germany's Dax ended up by 0.02 percent, France’s CAC finished the day up by 0.05 percent.
U. .S. stocks slouched to a higher close on Monday, and benchmark Treasury yields rose amid flickering optimism that Washington will get past partisan wrangling and reach a debt ceiling deal.
Dow Jones closed up by 0.14 percent, S&P 500 ended up by 0.30 percent, Nasdaq finished the day up by 0.66 percent.
Treasuries Recap
Longer-dated U.S. Treasury yields ticked higher on Monday on lingering investor concerns that inflation will remain sticky and in line with government bond yields in Europe, where the European Commission forecast higher growth and inflation.
Benchmark 10-year yields US1 climbed four basis points to 3.503% and 30-year bonds US30YT=RR were up five basis points to 3.832%.
Commodities Recap
Gold advanced on Monday on a weaker dollar as traders stuck to bets on interest rate cuts before year-end despite comments from Federal Reserve officials, with focus also on the U.S. debt ceiling talks.
Spot gold was up 0.4% at $2,019.37 per ounce by 1:40 p.m. EDT (1740 GMT), rebounding from its one-week low touched on Friday.U.S. gold futures settled up 0.1% at $2,022.70.
Oil prices rose a dollar a barrel on Monday after three straight sessions of declines, boosted by the prospect of tightening supplies in Canada and elsewhere, although recession fears kept pressuring the market.
Brent crude futures rose $1.06, or 1.4% to settle at $75.23 a barrel. U.S. West Texas Intermediate crude settled at $71.11 a barrel, up $1.07, or 1.5%.
