Market Roundup
•US Redbook (YoY) 12.6,%11.4% previous
•Canada May Manufacturing PMI 56.8,56.2 previous
•Canada May Manufacturing PMI 57.0,57.5 forecast, 59.2 previous
•US Apr Construction Spending (MoM) 0.2%, 0.5% forecast, 0.1% previous
•US May ISM Manufacturing Employment 49.6 ,56.0 forecast, 50.9 previous
•US May ISM Manufacturing PMI 56.1,54.5 forecast,55.4 previous
•US Apr JOLTs Job 11.400M, 11.400M forecast, 11.549M previous
•Canada BoC Interest Rate Decision1.50%,1.50% forecast, 1.00% previous
•US May Texas Services Sector Outlook 1.5,8.2 previous
•US May Dallas Fed Services Revenues 6.3, 11.2 previous
Looking Ahead Economic Data
• 01:30 Australia Apr Imports (MoM) -5% previous
• 01:30 Australia Apr Trade Balance 9.300B forecast, 9.314B previous
• 01:30 Australia Apr Retail Sales (MoM) 0.9% forecast, 0.9% previous
Looking Ahead - Events, Other Releases (GMT)
• 01:30 Japan BoJ Board Member Adachi Speaks
Currency Summaries
EUR/USD: The euro declined on Wednesday as weak German retail sales and slowing factory activity in the euro zone weighed on euro. German retail sales fell by more than expected in April . The Federal Statistics Office said on Wednesday that retail sales were down 5.4% on the month in real terms. Manufacturing growth in the euro zone slowed last month as factories faced supply shortages, high prices and a fall in demand, according to a survey which suggested consumers were switching their spending to tourism and recreation.S&P Global's final manufacturing Purchasing Managers' Index (PMI) fell to 54.6 in May from April's 55.5 .Immediate resistance can be seen at 1.0681(11DMA), an upside break can trigger rise towards 1.0714 (50%fib).On the downside, immediate support is seen at 1.0635(38.2%fib), a break below could take the pair towards 1.0525(23.6%fib).
GBP/USD: The British pound fell against the U.S. dollar on Wednesday as investors were concerned about a deteriorating growth outlook in UK. British manufacturing activity expanded in May at the weakest rate since January 2021, as producers of consumer goods struggled against a worsening cost-of-living crunch, a survey showed. The final estimate of the S&P Global UK Manufacturing Purchasing Managers' Index (PMI) fell to 54.6 in May from 55.8 in April, unchanged from a preliminary reading. Immediate resistance can be seen at 1.2560(11DMA),an upside break can trigger rise towards 1.2612 (38.2%fib).On the downside, immediate support is seen at 1.2443(23.6%fib), a break below could take the pair towards 1.2181(Daily low).
USD/CAD: The Canadian dollar was little changed against its U.S. counterpart on Wednesday, giving up its earlier gains, as the greenback broadly climbed and the Bank of Canada opened the door to an even faster pace of interest rate hikes. Canada's central bank went ahead with a second consecutive half-percentage-point interest rate hike, as expected, and said it was prepared to act "more forcefully if needed" to bring inflation back to target. The price of oil, one of Canada's major exports, rose after European Union leaders agreed to a partial and phased ban on Russian oil. The Canadian dollar was trading nearly unchanged at 1.2650, after touching its strongest since April 22 at 1.2610. Immediate resistance can be seen at 1.2691 (38.2%fib), an upside break can trigger rise towards 1.2742 (11DMA).On the downside, immediate support is seen at 1.2603(23.6%fib), a break below could take the pair towards 1.2550 (Lower BB).
USD/JPY: The dollar strengthened against the Japanese yen on Wednesday as upbeat US economic data boosted dollar. A report by the Institute for Supply Management (ISM) showed U.S. manufacturing activity picked up in May as demand for goods remained strong even with rising prices.The survey followed data released last Friday showing U.S. consumer spending, the largest contributor to American economic output, increased in April even amid growing concerns of a recession. The dollar was up 0.7% to 129.88 yen , its highest since May 17. Strong resistance can be seen at 130.24 (23.6%fib), an upside break can trigger rise towards 131.05(Higher BB).On the downside, immediate support is seen at 128.54 (38.2%fib), a break below could take the pair towards 127.02(38.2%fib).
Equities Recap
European shares fell on Wednesday as weak German retail sales and slowing factory activity in the euro zone fanned worries about economic growth amid record high inflation.
UK's benchmark FTSE 100 closed down by 0.98 percent, Germany's Dax ended down by 0.33 percent, France’s CAC finished the day down by 0.77percent.
Wall Street's three major indexes closed lower on Wednesday as investors bet that the latest economic data would do nothing to push the Federal Reserve off track from its aggressive interest rate hiking cycle aimed at taming run-away inflation.
Dow Jones was down by 0.53 % percent, S&P 500 closed down by 0.75 % percent, Nasdaq was down by 0.72% percent.
Treasuries Recap
U.S. Treasury yields rose to two-week highs on Wednesday in choppy trading, as concerns about recession hitting the world's largest economy have eased amid a solid round of economic data, even as the Federal Reserve remained on track to undertake aggressive tightening this year.
Benchmark U.S. 10-year yields hit two-week highs of 2.951%, and were last up 9.5 basis points at 2.9387% . U.S. two-year yields.
Commodities Recap
Gold prices rose from a two-week low on Wednesday as investors looked toward the safe-haven metal amid worries over an increase in inflation primarily due to rising fuel prices, although a stronger dollar and higher U.S. yields kept gains in check.
Spot gold rose 0.6% to $1,847.39 per ounce by 1:50 p.m. ET (1750 GMT), having hit its lowest since May 19 at $1,827.80 earlier in the session. U.S. gold futures settled 0.02% higher at $1,848.7.
Oil prices rose on Wednesday after European Union leaders agreed to a phased ban on Russian oil and as China ended its COVID-19 lockdown in Shanghai, which could bolster demand in an already tight market.
Brent crude settled at $116.29 a barrel, a gain of 69 cents, or 0.6%, while U.S. West Texas Intermediate crude gained 59 cents, or 0.5%, to $115.26.
