Market Roundup
• Canada Jul Housing Starts, 222.0K, 203.5K, 245.5K previous.
• US Jul Core PPI MoM , -0.1% 0.2%forecast, 0.3% previous.
• U.S Jul Core PPI YoY, 2.1%, 2.4% forecast, 2.3% previous.
• US Jul PPI (YoY) 1.7%, 1.7% forecast, -1.7% previous.
• US Jul PPI (MoM) 0.2%, 0.2% forecast 0.1% previous.
• US Canada Jun Building Permits (MoM) -3.7%, -12.2% forecast, 1.5% previous.
• US Canada Jul Employment Change, -24.2K, 12.5K forecast ,-2.2K previous.
• US Jul Participation Rate 65.6%, 65.7% forecast, 65.7% previous.
• Russia Jul Trade Balance 12.51B, 12.50B forecast, 11.82B previous.
Looking Ahead - Economic Data (GMT)
• No Economic Data
Looking Ahead - Events, Other Releases (GMT)
• No Significant data
Currency Summaries
EUR/USD: The euro gained against dollar on Friday, as euro shrugged off renewed political uncertainty in Italy and weak economic data around the world. The euro rose against the dollar to $1.1198, showing little reaction after Salvini called for early elections. Dollar dipped as Trump’s remarks on a trade deal with China followed a report that said Washington was delaying a decision to allow some trade between U.S. firms and China’s telecom equipment maker Huawei again. This added to worries about an escalation in trade tensions between the world’s two biggest economies. The euro was up 0.20 percent at $1.1202. An index that tracks the dollar versus a basket of six major currencies was down 0.03 at 97.55. Immediate resistance can be seen at 1.1224 (Aug 9th high), an upside break can trigger rise towards 1.1250 (6th Aug high).On the downside, immediate support is seen at 1.1157 (9 DMA), a break below could take the pair towards 1.
GBP/USD: Sterling declined against greenback on Friday, after an unexpected second quarter contraction in the economy cautioned investors already fretting that Britain is headed for a no-deal Brexit. Britain’s economy shrank at a quarterly rate of 0.2%, the first contraction since 2012 and below all forecasts in a poll. Year-on-year economic growth slid to 1.2% from 1.8% in the first quarter, Britain’s Office for National Statistics said, its weakest showing since the start of 2018. The pound, which has lost 3.7% of its value against the dollar since arch-Brexiteer Prime Minister Boris Johnson’s arrival in office in late July, sank to $1.2056, the weakest it has been since January 2017, and was last down by 0.5% at $1.2072. The British currency has been close to being the worst performing in the developed world these past couple of weeks since Johnson became prime minister on July 24.Immediate resistance can be seen at 1.2163 (11 DMA), an upside break can trigger rise towards 1.2312 (21 DMA).On the downside, immediate support is seen at 1.2000 (Psychological level), a break below could take the pair towards 1.1960 (Lower Bollinger Band).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Friday, as oil prices climbed, while greenback broadly declined. The currency found support from the price of oil, one of Canada's major exports. On Friday, U.S. crude oil futures were up 2.5% at $53.87 a barrel, supported by expectations of more OPEC production cuts. Canada's economy lost a net 24,200 jobs in July, after shedding 2,200 in the previous month, domestic data showed. The unemployment rate edged up to 5.7%. Analysts surveyed by had expected the economy to add 12,500 jobs last month. The Canadian dollar was last trading 0.16 percent higher at 1.3202 to the greenback. The currency traded in range of 1.3208 to 1.3275.Immediate resistance can be seen at 1.3243 (5 DMA), an upside break can trigger rise towards at 1.3305 (100 DMA).On the downside, immediate support is seen at 1.3190 (50 DMA), a break below could take the pair towards 1.3105 (31st July).
USD/JPY: The dollar weakened against the Japanese yen on Friday, as U.S.-China trade war jitters, renewed political uncertainty in Italy and weak economic data around the world increased demand for safe haven dollar. Fears of Washington’s trade war with Beijing escalated after report showed the United States has again held off on granting licenses to China’s telecom equipment maker Huawei. The dollar fell 0.4% against a surging yen to 105.61 yen, near the seven-month low of 105.5 hit earlier this week. The yen was on course for its second weekly gain versus the U.S. dollar. The dollar fell 0.4% against a surging yen to 105.61 yen, near the seven-month low of 105.5 hit earlier this week. The yen was on course. The dollar weakened against a basket of currencies, pressured as U.S. President Donald Trump repeated his call for a weaker currency to help American manufacturers for its second weekly gain versus the U.S. dollar. Strong resistance can be seen at 106.09 (5 DMA), an upside break can trigger rise towards 107.16 (11 DMA).On the downside, immediate support is seen at 105.18 (Lower Bollinger Band), a break below could take the pair towards 105.00 (Lower Bollinger Band).
Equities Recap
European shares slid on Friday with Italian stocks 2.5% lower on political uncertainty, while comments by U.S. President Donald Trump that he was not going to make a trade deal with China also weighed on sentiment.
The UK's benchmark FTSE 100 closed down by 0.44 percent, FTSEurofirst 300 ended the day down by 0.21 percent, Germany's Dax ended down by 1.28 percent, and France’s CAC finished the down by 0.44 percent.
Wall Street’s main indexes slipped on Friday after President Donald Trump said the United States and China were pursuing trade talks but he was not ready to make a deal,
exacerbating fears that the stand-off would aggravate the global economic slowdown.
Dow Jones closed down by 0.38 percent, S&P 500 ended down 0.63 percent, Nasdaq finished the day down by 1.00 percent.
Treasuries Recap
U.S. Treasury yields fell on Friday as trade worries about China and the United States flared up, along with political jitters in Italy and the UK economy's surprise contraction in the second quarter, fueling demand for safe-haven U.S. debt.
The yield on the 30-year, or long, bond was down 3.3 basis points at 2.214%. On Wednesday, the 30-year yield fell to 2.123%, within striking distance of an all-time low of 2.089% set in July 2016.
Longer-dated yields were also supported by data that showed U.S. domestic producer prices grew modestly in July, with core prices posting their first decline since October 2015.
Commodities Recap
Gold prices steadied on Friday, on course for their best week in over three years, as dovish central banks, escalating U.S.-China trade tensions and negative debt yields around the globe kept prices close to $1,500 per ounce.
Spot gold was down 0.1% at $1,498.97 per ounce at 1:56 p.m. EDT (1756 GMT) after it broke through $1,500 for the first time since April 2013 earlier this week.U.S. gold futures settled 0.1% lower at $1,508.50 an ounce.
Oil prices rose by about 3% on Friday,
supported by a drop in European inventories and expectations of more OPEC output cuts despite the International Energy Agency reporting demand growth at its lowest since the financial crisis of 2008.
Brent crude futures gained $1.40, or 2.4%, to $58.78 a barrel by 10:55 a.m. EDT (1455 GMT). U.S. West Texas Intermediate (WTI) crude futures were up $1.84, or 3.5%, to $54.38 a barrel.
