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America’s Roundup: Dollar gains after stronger-than-expected payrolls data , Wall Street ends mixed, Gold dips 1%, Oil prices end week on multi-month lows on recession fears, Oil prices end week on multi-month lows on recession fears-August 6th,2022

Market Roundup

•Nonfarm payrolls increase 528,000 in July

•Unemployment rate falls to 3.5% from 3.6% in June

•Average hourly earnings rise 0.5%; up 5.2% year-on-year

•Participation rate falls to 62.1% from 62.2% in June

•Canada Jul Part Time Employment Change  -17.5K,-39.1K previous

• US Jul Average Hourly Earnings (MoM)  0.5%,0.3% forecast, 0.3% previous

• US Jul Private Nonfarm Payrolls 471K, 230K forecast,381K previous

• US Jul  Nonfarm Payrolls  528K,250K forecast, 372K previous

• US Jul   Manufacturing Payrolls 30K,17K forecast, 29K previous

• US Jul Government Payrolls  57.0K,-9.0K previous

• Canada Jul Unemployment Rate  4.9%,5.0% forecast, 4.9% previous

• US Jul Unemployment Rate  3.5%,3.6% forecast, 3.6% previous

• US Jul Average Hourly Earnings (YoY) (YoY) 5.2%, 4.9% forecast, 5.1% previous

• US Jul Participation Rate  62.1%,62.2% previous

• Canada Jul Employment Change -30.6K, 20.0K forecast ,-43.2K previous

• US Jul U6 Unemployment Rate  6.7%,6.7% previous

•Canada Jul Ivey PMI n.s.a  53.2, 57.8 previous

• Canada Jul Ivey PMI   49.6, 60.3 forecast, 62.2 previous

•US Baker Hughes Oil Rig Count 598,605 previous

•US  U.S. Baker Hughes Total Rig Count 764,767 previous

•US Consumer Credit 40.15B, 25.00B forecast, 22.35B previous

Looking Ahead - Economic Data (GMT)

• No  data ahead

Looking Ahead - Economic events and other releases (GMT)

•No significant events

Currency Summaries

EUR/USD: The euro declined on Friday as dollar rallied after stronger-than-expected U.S. payrolls report suggested the Federal Reserve may need to continue aggressively raising interest rates in the near term. U.S. employers hired 528,000 workers in July, more than double what was expected, and the unemployment rate fell to a pre-pandemic low of 3.5%, providing the strongest evidence yet that the economy was not in recession .Bets for a 75 bps interest rate hike in September rose 65% as per polls. Immediate resistance can be seen at 1.0234(38.2%fib), an upside break can trigger rise towards 1.0298(23.6%fib).On the downside, immediate support is seen at 1.0170 (50%fib), a break below could take the pair towards 1.0111(61.8%fib).

GBP/USD: The British pound declined   on Friday after strong payroll numbers from the United States raised bets of another large rate hike by the Federal Reserve, sending the dollar soaring. The Fed last week raised its policy rate by three-quarters of a percentage point. The U.S. central bank has raised that rate by 225 basis points since March, but investors had been assessing recently whether the Fed might be less aggressive in hiking rates in the future. The dollar index is up more than 11% for the year so far amid the outlook for higher rates.Sterling was down 0.8% against the dollar at $1.2066 Immediate resistance can be seen at 1.2087(38.2%fib), an upside break can trigger rise towards 1.2168(23.6%fib).On the downside, immediate support is seen at 1.998 (50%fib),a break below could take the pair towards 1.1911(61.8%fib).

 USD/CAD: The Canadian dollar fell to a two-week low against the greenback on Friday as Canada's economy shed jobs for a second straight month in July, contrasting with a surge in U.S. hiring that could accelerate Federal Reserve interest rate hikes. The loonie  was trading 0.5% lower at 1.2935 to the greenback , after touching its weakest level since July 19 at 1.2984. For the week, the currency was down 1.1%, its biggest weekly loss in seven weeks. The Bank of Canada also expected to opt for an oversized rate hike next month despite data showing that Canada's economy shed 31,000 jobs in July, missing analyst expectations for an increase of 20,000.The price of oil, one of Canada's major exports, settled 0.5% higher at $89.01 a barrel but still trading near the lowest level since February. Immediate resistance can be seen at 1.2980 (23.6%fib), an upside break can trigger rise towards 1.3020 (18h July high).On the downside, immediate support is seen at 1.2916(38.2%fib), a break below could take the pair towards 1.2855 (50%fib).

USD/JPY: The dollar rose against yen on Friday unexpectedly strong U.S. jobs report boosted dollar. U.S. job growth unexpectedly accelerated in July, lifting the level of employment above its pre-pandemic level and pouring cold water on fears the economy was in recession. Nonfarm payrolls increased by 528,000 jobs last month, the largest gain since February, the survey of establishments showed. Data for June was revised higher to show 398,000 jobs created instead of the previously reported 372,000. July marked the 19th straight month of payrolls expansion, and blew off economists' expectations for a gain of only 250,000 jobs. Strong resistance can be seen at 135.79 (23.6%fib), an upside break can trigger rise towards 134.00(Psychological level).On the downside, immediate support is seen at 134.05 (38.2%fib), a break below could take the pair towards 132.66 (50%fib).

Equities Recap

European stocks closed lower on Friday as data showing a much bigger than expected rise in U.S. non-farm payroll employment in the month of July raised concerns the Fed will aggressively hike rates in the coming months.

The UK's benchmark FTSE 100 closed up by 0.32 percent, Germany's Dax ended up  by 0.85percent, and France’s CAC finished the up by 0.56 percent.

The S&P 500 ended lower on Friday, weighed down by Tesla and other technology-related stocks after a solid jobs report torpedoed recent optimism that the Federal Reserve might let up its aggressive campaign to reign in decades-high inflation.

Dow Jones closed up by 0.21 percent, S&P 500 ended down 0.16 percent, Nasdaq finished the day down  by 0.50 percent.

Treasuries Recap

U.S. Treasury yields rose sharply on Friday after data showed the world's largest economy created far more jobs than expected in July, bolstering expectations the Federal Reserve will continue to raise interest rates in the next few meetings to slow inflation.

The yield on 10-year Treasury notes   was up 15 bps at 2.8287%.On the week, 10-year yields climbed 18 bps, the largest increase in one month.

U.S. 30-year bond yields rose nearly 10 bps to 3.0605% US30YT=RR. It advanced to two-week peaks of 3.106% on the day.

Commodities Recap

Gold prices extended losses to slide more than 1% on Friday as an unexpectedly strong U.S. jobs report eased recession worries and dashed speculation that the Federal Reserve would pivot away from its aggressive monetary policy tightening.

Spot gold fell 0.9% to $1,775.09 per ounce by 1:43 p.m. ET (1743 GMT), after falling as much as 1.5% earlier in the day. U.S. gold futures settled down 0.9% at $1,791.2.

Oil prices settled higher on Friday, recouping some of this week's losses on strong U.S. job growth data, but closed the week at their lowest levels since February, rattled by worries a recession could hit fuel demand.

Brent crude settled up 80 cents to $94.92 a barrel, 11% off last Friday's settlement. U.S. West Texas Intermediate crude settled up 47 cents to $89.01, off 8% in the week.

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