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America’s Roundup: U.S. dollar pauses record gains as UK pound stabilizes, Wall Street ends sharply higher, Gold up around 2%, Oil prices jump after U.S. crude, fuel stocks drop-September 29th,2022

Market Roundup

• US Aug Retail Inventories Ex Auto 0.6%, 0.4% previous

• US Aug Goods Trade Balance   -87.30B, -90.19B previous

• US Wholesale Inventories (MoM) 1.3%,0.6% previous)

•US Aug  Pending Home Sales (MoM)   - 88.4, 1.4% forecast, -1.0% previous

•US Aug   Pending Home Sales (MoM)  -2.0%,-1.4% forecast, -1.0% previous

•US Gasoline Production  0.166M ,0.006M previous

•US EIA Weekly Distillates Stocks -2.892M, -0.069M forecast, 1.231M previous

•US Cushing Crude Oil Inventories 0.692M, 0.343M previous            

• US Crude Oil Inventories -0.215M ,0.443M forecast, 1.142M previous

Looking Ahead - Economic Data (GMT)

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Looking Ahead - Events, Other Releases (GMT)

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Currency Summaies

EUR/USD: The euro staged a partial comeback on Wednesday after the Bank of England said it would step in to the bond market in an attempt to dampen investors' fears of contagion across the financial system. The BoE said it would temporarily buy long-dated bonds - linked most closely to workers' pensions and home loans - in light of a surge in UK bond yields and related borrowing costs The dollar, the ultimate safe-haven in times of market turmoil, was down about 1.2%, easing from two-decade highs spurred on by yields on the benchmark 10-year Treasury approaching 4.0% for the first time since 2008.Immediate resistance can be seen at 0.9730(38.2%fib), an upside break can trigger rise towards 0.9777(9DMA).On the downside, immediate support is seen at 0.9617(23.6%fib), a break below could take the pair towards 0.9594(Lower BB).

GBP/USD: Sterling recovered some ground against the dollar on Wednesday following the Bank of England's (BOE) purchase of UK government bonds, letting some air out of the greenback's progress broadly after it had touched a fresh 20-year high.The BoE said it received 2.587 billion pounds' ($2.78 billion) worth of offers in its first bond buyback operation aimed at stabilizing the market, and had accepted only 1.025 billion pounds' worth. The central bank had committed to buying as many long-dated government bonds, know as gilts, as needed between Wednesday and Oct. 14.As markets tried to digest what the move meant for the pound, the currency whipsawed during Wednesday's session, jumping as high as $1.09165 and falling as low as $1.05390. It was last trading at at $1.0821.Immediate resistance can be seen at 1.1038(9DMA), an upside break can trigger rise towards 1.1077(38.2%fib).On the downside, immediate support is seen at 1.0793(23.6%fib),a break below could take the pair towards 1.0675(Lower BB).

USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Wednesday as the Bank of England's move to support the bond market wrong-footed some investors, with the currency pulling back from its weakest level in more than two years.Wall Street rebounded strongly following its recent sell-off, while U.S. Treasury yields tumbled and the U.S. dollar lost ground against a basket of major currencies after the BoE said it would buy long-dated British bonds in a move aimed at restoring financial stability.The Canadian dollar was trading 0.7% higher at 1.3625 to the greenback, after earlier touching its weakest level since May 2020 at 1.3832 . Immediate resistance can be seen at 1.3649 (Daily high), an upside break can trigger rise towards 1.3727 (23.6%fib).On the downside, immediate support is seen at 1.3594 (38.2%fib), a break below could take the pair towards 1.3537 (9DMA).

USD/JPY: The dollar steadied against yen on Wednesday after Chicago Fed President Charles Evans reiterated a hawkish stance towards inflation. The U.S. Federal Reserve will need to raise interest rates to a range between 4.50% and 4.75%, Chicago Fed President Charles Evans said on Tuesday, a more aggressive stance than he has previously embraced that underscores the central bank's hardening resolve to quash excessively high inflation. Evans also said that he does not see  recession-like unemployment rate numbers ahead, even as the Fed's actions result in below-trend economic growth and a softening in the labor market to bring inflation back down to the central bank's 2% goal. The dollar is scaling fresh two-decade highs nearly every day, which is keeping Japanese yen on back foot . Strong resistance can be seen at 144.90(23.6%fib), an upside break can trigger rise towards 145.79(Higher BB).On the downside, immediate support is seen at 144.00(5DMA), a break below could take the pair towards 142.55(38.2%fib).

Equities Recap

European shares gained on Wednesday, with the UK's blue-chip index reversing losses after the Bank of England said it would purchase bonds to cool a turmoil in markets stemming from the British government's fiscal plans.

The UK's benchmark FTSE 100 closed up by 0.32 percent, Germany's Dax ended up  by 0.32 percent, and France’s CAC finished the up by 0.17 percent.

U.S. stocks edged higher on Wednesday, extending a strong start to the quarter as rising hopes of a trade deal with Beijing boosted investor sentiment.

Dow Jones closed up by 0.95 percent, S&P 500 ended up 1.03 percent, Nasdaq finished the day up by 0.82 percent.

Treasuries Recap

U.S. Treasury prices rebounded sharply on Wednesday after the Bank of England said it would buy long-dated British bonds in a moved aimed at restoring financial stability in markets rocked globally by the fiscal policy of the new government in London.

The two-year   Treasury yield, which typically moves in step with interest rate expectations, fell 15.7 basis points to 4.151%.

The breakeven rate on five-year U.S. Treasury Inflation-Protected Securities (TIPS)   was last at 2.358%.The 10-year TIPS breakeven rate   was last at 2.304%

Commodities Recap

Gold rose about 2% on Wednesday as a retreat in the dollar rekindled some of its safe-haven appeal, although prospects of sharp rate hikes kept the non-yielding precious metal near a 2-1/2-year trough.

Spot gold climbed 2% to $1,660.62 per ounce by 1:49 p.m. EDT (1749 GMT), to recoup some losses from a slide to its lowest since April 2020 earlier in the day.U.S. gold futures settled 2.1% higher at $1,670.00.

Oil prices rose on Wednesday for a second day, rebounding from recent losses as the U.S. dollar eased off recent gains and U.S. fuel inventory figures showed larger-than-expected drawdowns and a rebound in consumer demand.

Brent crude futures settled up $3.05, or 3.5%, at $89.32 per barrel. U.S. West Texas Intermediate (WTI) crude futures ended up $3.65, or 4.7%, to $82.15 a barrel.

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