Market Roundup
• US May Goods Trade Balance -104.31B,-106.70B previous
•US May Retail Inventories Ex Auto 0.8%,1.7% previous
• US Wholesale Inventories (MoM) 2.0%,2.1% forecast, 2.2% previous
• US Redbook (YoY) 11.7%,12.8% previous
• US Apr S&P/CS HPI Composite - 20 n.s.a. (YoY) 21.2%, 21.0% forecast, 21.2% previous
• US Apr S&P/CS HPI Composite - 20 n.s.a. (MoM) 2.3% ,3.1% previous
• US S&P/CS HPI Composite - 20 s.a. (MoM) 1.8%, 2.0% forecast, 2.4% previous
• US CB Jun Consumer Confidence 98.7 ,100.4 forecast, 106.4 previous
• US Jun Richmond Manufacturing Shipments -29,-14 previous
•US Jun Texas Services Sector Outlook -12.4,1.5 previous
•US Jun Dallas Fed Services Revenues 9.4, 6.3 previous
Looking Ahead - Economic Data (GMT)
•23:50 Japan May Retail Sales (YoY) 3.3% forecast,3.1% previous
•01:30 Australian May Retail Sales (MoM) 0.4% forecast,,0.9% previous
Looking Ahead - Events, Other Releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro declined on Tuesday after European Central Bank (ECB) President Christine Lagarde offered no fresh insight into the central bank's policy outlook.The ECB is widely expected to follow its global peers by raising interest rates in July to try to check soaring inflation though economists are divided on the magnitude of any rate hike.The euro held below $1.06 after Lagarde said the central bank would move gradually but with the option to act decisively on any deterioration in medium-term inflation, especially if there were signs of a de-anchoring of inflation expectations.. Immediate resistance can be seen at 1.0506(20DMA),an upside break can trigger rise towards 1.0621(38.2%fib).On the downside, immediate support is seen at 1.0476(23.6%fib), a break below could take the pair towards 1.0385(Lower BB).
GBP/USD: Sterling fell against the dollar on Tuesday, undermined by Britain's bleak economic and political outlook relative to other big economies, including the government's plans to ditch pre-agreed rules on post-Brexit trade with Northern Ireland.Monday saw British Prime Minister Boris Johnson press on with plans to pass legislation through parliament to overturn parts of a Brexit divorce deal over Northern Ireland trade. The pound slipped 0.6% versus the dollar at $1.2192 . It flatlined against the euro at 86.200 pence after touching a near two-week low to the single currency. Immediate resistance can be seen at 1.2257(5DMA),an upside break can trigger rise towards 1.2336(38.2%fib).On the downside, immediate support is seen at 1.2178(23.6%fib), a break below could take the pair towards 1.2107(June 13th low).
USD/CAD: The Canadian dollar strengthened for a third straight day against its U.S. counterpart on Tuesday as the easing of COVID-19 restrictions in China bolstered investor sentiment. Global shares were higher and the price of oil, one of Canada's major exports, rose following China's decision to ease some quarantine requirements for international arrivals, a move that raised hopes for stronger growth and a revival in demand for commodities. Adding to support for oil, major producers Saudi Arabia and the United Arab Emirates looked unlikely to be able to boost output significantly while Western governments agreed to explore ways to cap the price of Russian oil .Immediate resistance can be seen at 1.2883 (38.2%fib), an upside break can trigger rise towards 1.2981 (23.6%fib).On the downside, immediate support is seen at 1.2821(20DMA), a break below could take the pair towards 1.2798 (50%%fib).
USD/JPY: The dollar steadied against the Japanese yen on Tuesday as investors remained focused on inflation risks and monetary tightening. New York Federal Reserve Bank President John Williams on Tuesday in an interview on CNBC said interest rates definitely needed to be between 3% and 3.5% by the end of this year, but that he did not anticipate a U.S. recession. The U.S. dollar index , which struck a two-decade high of 105.79 this month, was last up 0.51% at 104.490. The U.S. dollar was trading higher 0.02 % versus the yen to 136.14. Strong resistance can be seen at 136.19 (23.6%fib), an upside break can trigger rise towards 137.00(Psychological level).On the downside, immediate support is seen at 134.90(14DMA), a break below could take the pair towards 132.92(38.2%fib).
Equities Recap
European shares rose on Tuesday as risk appetite improved after China eased its COVID-19 quarantine mandate, while rising oil prices provided an additional boost to energy stocks.
UK's benchmark FTSE 100 closed up by 0.90 percent, Germany's Dax ended up by 0.35 percent, France’s CAC finished the day up by 0.64 percent.
Wall Street closed sharply lower in a broad sell-off on Tuesday as dire consumer confidence data dampened investor optimism and fueled worries over recession and the looming earnings season.
Dow Jones closed down by 1.56% percent, S&P 500 closed down by 2.01% percent, Nasdaq settled up by 2.98% percent.
Treasuries Recap
U.S. Treasury yields were mostly flat on Tuesday after a report showed consumer confidence slumped in June on concerns that high inflation will likely weaken economic growth later this year.
The yield on 10-year Treasury notes fell 0.2 basis points to 3.192%.
Commodities Recap
Gold prices were hemmed in a tight range on Tuesday as prospects of higher interest rates challenged bullion's safe-haven appeal while recession risks boosted it.
Spot gold edged 0.1% lower to $1,820.31 per ounce by 2:09 p.m. ET (1809 GMT). U.S. gold futures settled down 0.2% at $1,821.2.
Oil prices settled higher for a third day on Tuesday as major producers Saudi Arabia and the United Arab Emirates looked unlikely to be able to boost output significantly while Western governments agreed to explore ways to cap the price of Russian oil.
Brent crude futures climbed $2.89, or 2.5%, to settle at $117.58 a barrel by 12:33 p.m. EDT (1633 GMT). U.S. West Texas Intermediate (WTI) crude settled up$2.19, or 2%, to $111.76 a barrel.
