Market Roundup
• US Initial Jobless Claims, 216k, 216k forecast, 208k previous
• US Continued Jobless Claims, 1.686 mln, 1.700 mln forecast, -1.728 mln previous
• US July Philadelphia Fed Manufacturing Index 21.8,5.0 forecast, 0.3 previous
• US July Philly Fed Business Conditions 38.0, 21.4 previous
• US July Philly Fed CAPEX Index 36.90, 28.00 forecast
• US July Philly Fed Employment 30.00, 15:04 forecast
• US July Philly Fed New Orders 18.09,8.03 forecast
• Canada ADP Nonfarm Employment Change 30.4k, 16.0k forecast
• Russia Central Bank reserves 519.7B, forecast 518.3B
• South Africa July Interest Rate Decision 6.50%, forecast 6.50%,, 6.50%, previous
• South Africa July Prime Rate 10:00%, 10:25%, previous
Looking Ahead - Economic Data (GMT)
• 23:30 Japan June National Core CPI (YoY), 0.6% forecast, 0.8%, previous
• 23:30 Japan June National CPI (MoM), 0.7% forecast, 0.7%, previous
• 03:00 New Zealand Credit Card Spending (YoY) 6.6%, previous
• 04:30 Japan All Industries Activity Index (MoM), 0.3% forecast, 0.9%, previous
Looking Ahead - Events, Other Releases (GMT)
• 15:05 Federal Reserve Bank of St. Louis President and Federal Open Market Committee (FOMC) voting member( March 2011 - today) James Bullard is to speak.
• 20:30 Federal Reserve Bank of Boston President and Federal Open Market Committee (FOMC) voting member( March 2011 - today) Eric S. Rosengren to speak.
Currency Summaries
EUR/USD: The euro rose higher against the U.S. dollar on Thursday ,as risk aversion in the broader markets pushed benchmark U.S. yields to a nine-day low dragging dollar lower.The dollar index versus a basket of six major currencies was down 0.2% at 97.081.The index had climbed to a one-week peak of 97.444 the previous day on stronger-than-expected U.S. retail sales and a slump in sterling. But it edged lower as safe-haven Treasury yields fell in the wake of weak U.S. housing market data and concerns about the prolonged U.S.-China trade dispute. The International Monetary Fund (IMF) said on Wednesday the greenback was overvalued by 6% to 12%, based on near-term economic fundamentals. The Fed is widely expected to lower interest rates by 25 basis points (bps) at its July 30-31 policy meeting, with some in the market wagering on a larger 50 bps cut. Immediate resistance can be seen at 1.1285 (21 DMA), an upside break can trigger rise towards 1.1318 (200 DMA).On the downside, immediate support is seen at 1.1237 (9 DMA), a break below could take the pair towards 1.1200 (Psychological level).
GBP/USD: The British pound rose against the dollar on Thursday, as traders betting against the currency took some profits after it plunged this week amid jitters about the threat of a no-deal Brexit. Retail sales data for June will be released at 0830 GMT, helping traders assess the state of the British economy. Several economists have predicted it shrank in the second quarter. Sterling dropped this week after the two candidates to replace Prime Minister Theresa May appeared to push for a no-deal Brexit if they cannot renegotiate a proposed withdrawal agreement with the European Union. The pound rose 0.9% to $1.2551, away from the 27-month low of $1.2382 hit on Wednesday. Immediate resistance can be seen at 1.2582 (21 DMA), an upside break can trigger rise towards 1.2651 (50 DMA).On the downside, immediate support is seen at 1.2496 (9 DMA), a break below could take the pair towards 1.2400 (Psychological level).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Thursday, as the greenback broadly fell and domestic data supported the view the economy is recovering after a slow patch at the turn of the year. Canadian home prices rose 0.8% in June from the prior month, thanks to a seasonal boost, but the increase was lower than the month's 21-year average, data showed. A separate report from ADP, a human resources solutions company, showed that Canada added 30,400 jobs in June, as hirin rebounded after a sharp decline in May. The Canadian dollar was trading 0.3% higher at 1.3045 to the greenback, or 76.66 U.S. cents. The currency, which last Friday notched a near nine-month high at 1.3018, traded in a range of 1.3035 and 1.3093. Immediate resistance can be seen at 1.3097 (21 DMA), an upside break can trigger rise towards 1.3192 (Higher Bollinger Bands).On the downside, immediate support is seen at 1.3021 (July 15th low), a break below could take the pair towards 1.3000 (Psychological level).
USD/JPY: The dollar weakened against the Japanese yen on Thursday, as remarks from New York Federal Reserve President John Williams increased bets the central bank would lower interest rates at month-end. Williams said Central bankers need to act quickly and forcefully when rates are low and economic growth is slowing. After Williams’ comments, traders increased their bets that the Fed could go deeper than a quarter-point cut at its meeting in late July. The dollar index fell 0.42% to 96.81, after being mainly flat on the day. Strong resistance can be seen at 107.90 (Psychological level), an upside break can trigger rise towards 108.21 (11 DMA).On the downside, immediate support is seen at 107.00 (Psychological level), a break below could take the pair towards 106.80 (June 25th low).
Equities Recap
European stocks ended lower on Thursday, as earnings worries ran high after poor results from software firm SAP sank technology shares, although hopes of looser monetary policy from the European Central Bank helped indexes bounce off early lows.
UK's benchmark FTSE 100 closed down by 0.56 percent , Germany's Dax ended down by 0.92 percent, France’s CAC finished the day down by 0.38percent.
U.S. stock indexes edged higher on Thursday as investors awaited more developments around trade, while Netflix posted a surprise drop in U.S. subscribers, kicking off earnings for the FAANG group of stocks on a sour note.
Dow Jones closed down flat, S&P 500 ended up by 0.36 percent, Nasdaq finished the down up by 0.27 percent.
Treasuries Recap
U.S. Treasury yields declined on Thursday, after a Federal Reserve official said policymakers need to add stimulus early to address too-low inflation when interest rates are near zero and said they cannot wait for economic disaster to unfold.
Benchmark 10-year notes were last up 7/32 to yield 2.038%, down from 2.061% late Wednesday.
Commodities Recap
Gold prices held steady on Thursday, holding close to a two-week high, as the dollar eased on rising expectations of an interest rate cut by the U.S. Federal Reserve.
Spot gold was up 0.2% at $1,430.01 an ounce as of 02:00 p.m. EDT (1800 GMT), after touching its highest since July 3 at $1,432.20. U.S. gold futures settled up 0.3% at $1,432.90 an ounce.
Oil fell about 2.5% a barrel on Thursday, weighed down by weakness in U.S. equities markets and an expectation that crude output would rise in the Gulf of Mexico following last week’s hurricane in the region.
Brent crude futures settled down $1.73, or 2.7% at $61.93 a barrel.West Texas Intermediate crude futures were down $1.48 a barrel, or 2.6% at $55.30.
