Market Roundup
•Canada Mar Foreign Securities Purchases by Canadians21.22B, 10.54B previous
•Canada Mar Foreign Securities Purchases 3.25B,8.52B previous
•US May NY Empire State Manufacturing Index 24.30, 23.90 forecast, 26.30 previous
• French 6-Month BTF Auction -0.630% ,-0.638% previous
• French 3-Month BTF Auction -0.626%,-0.636% previous
• French 12-Month BTF Auction-0.626%, -0.628% previous
• US May NAHB Housing Market Index 83, 83 forecast,83 previous
• US 6-Month Bill Auction 0.015%, 0.015% previous
• US 3-Month Bill Auction 0.030%,0.035% previous
Looking Ahead - Economic events and other releases (GMT)
•23:50 Japan GDP Capital Expenditure (QoQ) (Q1) 1.1% foreast,4.3% previous
•23:50 Japan GDP External Demand (QoQ) (Q1) -0.2% forecast, 1.1% previous
•23:50 Japan GDP Private Consumption (QoQ) (Q1) -2.0% forecast, 2.2% previous
•23:50 Japan GDP (QoQ) (Q1) -1.2% forecast, 2.8% previous
•23:50 Japan GDP (YoY) (Q1) -4.6% forecast, 11.7% previous
Looking Ahead - Economic events and other releases (GMT)
Currency Summaries
EUR/USD: The euro gained against dollar on Monday as renewed worries about coronavirus restrictions in Asia reduced demand for greenback. A dollar bounce that followed higher-than-expected inflation data last week has faded as traders figure the U.S. Federal Reserve will keep rates low. Fed minutes, from an April meeting that predated the data surprise on inflation last week, are due on Wednesday and are the next market focus for clues on the central bank's thinking. Immediate resistance can be seen at 1.2186 (23.6%fib), an upside break can trigger rise towards 1.2208 (Higher BB).On the downside, immediate support is seen at 1.2110 (5DMA), a break below could take the pair towards 1.2087 (38.2%fib).
GBP/USD: Sterling held on to recent gains against the dollar on Monday as Britain took a big step towards reopening its economy, lifting a number of social restrictions imposed to combat the COVID-19 outbreak. Cafes, bars and restaurants will reopen for indoor service and a ban on international travel has also been lifted, among other easing measures. Sterling has gained against the dollar for two weeks straight, and on Monday, consolidated near the $1.41 mark. It traded flat in early US deals, at $1.4088. Immediate resistance can be seen at 1.4127 (23.6%fib), an upside break can trigger rise towards 1.4175 (11th May high).On the downside, immediate support is seen at 1.4032(9DMA), a break below could take the pair towards 1.4005(38.2%fib).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Monday as oil prices rose and the greenback broadly declined, with the currency approaching the six-year high it notched last week. Canadian home sales, prices and starts all fell in April compared with the previous month, as some of the frenzy of recent months began to unwind, although activity remains strong, data showed. The loonie was trading 0.3% higher at 1.2060 to the greenback. Last Wednesday, it touched its strongest level since 2015 at 1.2042..Immediate resistance can be seen at 1.2115(5DMA), an upside break can trigger rise towards 1.2154 (38.2%fib).On the downside, immediate support is seen at 1.2042 (23.6%fib), a break below could take the pair towards 1.2000 (Psychological level).
USD/JPY: The dollar declined against the yen on Monday as inflation jitters, exacerbated by record high prices paid in a regional U.S. manufacturing survey, reduced demand for greenback. The Empire State report from the New York Federal Reserve showed a survey record high of prices paid by manufacturers in New York state as materials producers struggle to keep up with booming demand. The dollar was trading down 0.15% on the yen at 109.15. Strong resistance can be seen at 109.46(38.2%fib), an upside break can trigger rise towards 109.90 (23.6%fib).On the downside, immediate support is seen at 109.04 (50%fib), a break below could take the pair towards 108.60 (61.8%fib).
Equities Recap
European stocks ended flat on Monday as underwhelming Chinese data and caution over the spread of a COVID-19 variant outweighed optimism on the reopening of the British economy, while Sweden’s Kinnevik surged and was the top performer.
UK's benchmark FTSE 100 closed down by 0.15 percent, Germany's Dax ended down by 0.13 percent, France’s CAC finished the day down by 0.28 percent.
Wall Street's main indexes ended lower on Monday, as signs of inflationary pressures building up in the economy kept investors worried about monetary policy tightening.
Dow Jones closed down by 0.16% percent, S&P 500 closed down by 0.24 % percent, Nasdaq settled down by 0.38% percent.
Treasuries Recap
U.S. Treasury yields traded little changed on Monday, shrugging off the highest prices ever paid in a May manufacturing survey for New York state, as traders mull how tolerant Federal Reserve policymakers will be as the pace of inflation quickens.
The yield on benchmark 10-year U.S. Treasury notes was up 2 basis points at 1.6%37, well below a spike to 1.77% in late March.
Commodities Recap
Gold prices hit a 3-1/2 month high on Monday as a dip in U.S. Treasury yields and persistent inflation worries in the bullion market burnished its appeal.
Spot gold rose 0.4% to $1,848.66 per ounce by 1220 GMT, after hitting its highest since Feb. 2. U.S. gold futures gained 0.5% to $1,848.00.
Oil prices rose more than 1% on Monday, lifted by European economic reopenings and rising U.S. demand after prices fell earlier due to surging coronavirus cases in Asia and underwhelming Chinese manufacturing data.
Brent crude ended the session up 75 cents, or 1.1%, at $69.46 a barrel and West Texas Intermediate (WTI) crude settled 90 cents, or 1.4%, higher at $66.27.
