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America's Roundup: Dollar index hovers near 2-week high, Wall Street falls, Gold slides to two-week low,Oil slips but ends week higher on Mideast supply disruption fears-May 18th,2019

Market Roundup

• China's tough trade rhetoric leaves talks with U.S. in limbo

• U.S. to remove tariffs on Canadian metals, Mexico deal imminent

• Trump declares some auto imports pose national security threat

• EU welcomes auto tariff delay and says ready to negotiate deal

• US May U Mich Sentiment Prelim, 102.4, 97.5 forecast, 97.2 previous

• Britain's Brexit talks collapse as May's premiership crumbles

• China's central bank won't let yuan weaken past 7 to the dollar-sources

Looking Ahead - Economic Data (GMT)

• 19 May 23:50 Japan Q1 GDP QQ, 0.0% forecast, 0.5% previous

• 19 May 23:50 Japan Q1 GDP QQ Annualised, -0.2% forecast, 1.9% previous

• 19 May 23:50 Japan Q1 GDP QQ Pvt Consmp Prelim, -0.1% forecast, 0.4% previous

• 19 May 23:50 Japan Q1 GDP QQ Capital Expenditure, -1.7% forecast, 2.7% previous

• 19 May 23:50 Japan Q1 GDP QQ External Demand, 0.3% forecast, -0.3% previous

Looking Ahead - Events, Other Releases (GMT)

• May 18 17:05 Dallas Fed President Robert Kaplan participates in a conversation before The Society for Advancing Business Editing and Writing (SABEW) 56th Annual Spring Conference in Phoenix

• May 20 N/A Fed's Clarida and New York Fed President John Williams participate in two-hour "Fed Listens" Roundtable in New York

• May 20 07:00 Riksbank executive board meeting in Stockholm

• May 20 11:05 Riksbank Deputy Governor Cecilia Skingsley talks about developments in the payment market during the conference "Cash on Trial"

• May 20 11:30 German Economy Minister Peter Altmaier speaks on his country's industrial strategy at an economic forum in Brandenburg, Germany

• May 20 13:30 Philadelphia Fed President Patrick Harker speaks on the economic outlook before the Management Science 65th Anniversary Conference in Boston

• May 20 16:30 BoE Deputy Governor Ben Broadbent speaks on "Investment and the duration of uncertainty" at Imperial College Business School in London

Currency Summaries

EUR/USD: The euro declined against the U.S. dollar on Friday, as investors squared positions before  impending European Parliament elections. The euro is under pressure from worries about next week's European parliamentary elections and comments from Italian Deputy Prime Minister Matteo Salvini.Salvini said on Thursday that he would "tear apart" EU budget rules that were "strangling" Italy if his party did well in the elections. The euro dropped to its lowest since May 6 and was a touch lower at $1.1158, down 0.6% this week. Immediate resistance can be seen at 1.1199 (9 DMA), an upside break can trigger rise towards 1.1242 (50 DMA).On the downside, immediate support is seen at 1.1155 (Session low), a break below could take the pair towards 1.1118 (Lower Bollinger Bands).

GBP/USD: The Sterling declined  against the dollar on Friday, as cross-party Brexit talks neared collapse and pressure mounted on Prime Minister Theresa May to resign.Brexit talks between May's Conservatives and the opposition Labour Party are about to end without an agreement, the BBC reported. Earlier, May had agreed to set out a timetable for her departure in early June. Sterling was down 0.1% on Friday at $1.2785, near its February low of $1.2773. It had dropped to a three-month low earlier this week and dipped below $1.28 on Thursday. A stronger dollar also weighed on the British currency. Immediate resistance can be seen at 1.2846 (5 DMA), an upside break can trigger rise towards 1.2759 (Dec 10th High).On the downside, immediate support is seen at 1.2711 (Session low), a break below could take the pair towards 1.2660 (23.6% retracement level).

USD/CAD: The Canadian dollar edged higher against its U.S. counterpart on Friday, recovering from an earlier three-week low after reports that a deal were reached to remove tariffs on its metals that had been imposed by the United States U.S. officials have agreed to remove tariffs on steel and aluminum imported from Canada and Mexico in 48 hours, paving the way for the three North American counties to enact a new trade pact, the Washington Post and Politico reported. At   (2013 GMT), the Canadian dollar  was  last trading 0.1% higher at 1.3457 to the greenback, or 74.31 U.S. cents. Immediate resistance can be seen at 1.3500 (Psychological Level), an upside break can trigger rise towards 1.3536 (Higher Bollinger Bands).On the downside, immediate support is seen at 1.3445 (21 DMA), a break below could take the pair towards 1.3392 (50 DMA).

USD/JPY: The dollar strengthened against the Japanese yen on Thursday, as  dollar was lifted to near two-week highs by positive U.S. economic data. Data on Friday showed U.S. consumer sentiment jumped to a 15-year high in early May on growing confidence over the economy's outlook, though much of the surge was recorded before the trade war escalation. The greenback brushed off concerns over the latest escalation in the United States' trade standoff with China, climbing as housing starts increased more than expected and the labour market showed resilience. The dollar was 0.17 percent  higher versus the Japanese yen at 110.23.. Strong resistance can be seen at 110.04 (11 DMA), an upside break can trigger rise towards 110.80 (21 DMA).On the downside, immediate support is seen at 108.91 (Lower Bollinger Bands), a break below could take the pair towards 109.49 (Lower Bollinger Bands).

Equities Recap

European stocks snapped a three-day winning streak on Friday amid global trade jitters after Beijing ratcheted up its war of words with Washington, while the end of Brexit talks between British political parties put a lid on risk sentiment.

UK's benchmark FTSE 100 closed down 0,01 percent, the pan-European FTSEurofirst 300 ended the day down by 0.32 percent, Germany's Dax ended down by 0.5 percent, France’s CAC finished the day down by 0.01 percent.

U.S. stocks declined sharply on Wednesday after the Federal Reserve's forecast of fewer interest-rate increases in 2019 fell short of investors' hopes of a more dovish monetary policy.

Dow Jones closed down by 0.39 percent, S&P 500 ended down by 0.59 percent, Nasdaq finished the day down by 1.05 percent.

Treasuries Recap

Trade tension between the United States and China ratcheted up again on Friday, pushing Treasury yields slightly lower as traders sought safety in high-quality assets.

Yields across maturities were lower, with the biggest moves at the long end of the yield curve. The 10-year yield   was last down 0.9 basis point to 2.396%, with the 30-year yield   last down 1.3 basis points at 2.827%.

Commodities Recap

Gold prices on Friday slipped to their lowest in two weeks as the dollar advanced on the back of strong U.S. economic data, putting the metal on track for its biggest weekly decline in a month.

Spot gold fell 0.8% to $1,276.25 per ounce as of (1746 GMT), having dropped to its lowest since May 3 at $1,274.51 earlier in the session. The metal is down 0.7% for the week so far, which could be its biggest weekly decline since April 19.

Oil prices edged lower on Friday due to demand fears amid a standoff in Sino-U.S. trade talks, but both benchmarks ended the week higher on rising concerns over supply disruptions in Middle East shipments due to U.S.-Iran political tensions.

Brent crude fell 41 cents, or 0.6%, to settle at $72.21 a barrel. The global benchmark notched a weekly gain of about 2%, having ended last week largely steady and fallen the week before.

U.S. West Texas Intermediate crude fell 11 cents to end the session at $62.76, and gained about 1.7% on the week.

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