Market Roundup
- Britain's May brings back foe, aiming to unite party before Brexit
- Japan Apr core machinery orders -3.1% m/m, +2.7% y/y, -1.3% and +6.3% eyed
- Japan May domestic corp goods prices unch m/m, +2.1% y/y, +0.1%, +2.2% eyed
- UK May cons spending y/y, -0.8%, last +0.3% -Visa
- Half of UK employers unprepared for immigration changes - think tank
- China state papers urge regulators to stick to reforms as pace of IPOs slows
- China unlikely to see repeat of 2013 market turbulence-Financial News
- U.S. attorney general to face questions on Comey firing, Russia
- Macron's party set for huge French parliamentary majority
Economic Data Ahead
- (0400 ET/0800 GMT) Italy Apr Industrial Output WDA y/y, 2.4% eyed; last 2.8%
- (0400 ET/0800 GMT) Italy Apr Industrial Output SA m/m, 0.2% eyed; last 0.4%
Key Events Ahead
(0700 ET/1100 GMT) Meeting of the executive board of the Riksbank
FX Beat
DXY: The dollar steadied versus its major peers as markets focus shifted on this week's U.S. Federal Reserve's two-day policy meeting that ends on Wednesday. The greenback against a basket of currencies traded 0.1 percent down at 97.16, having touched a high of 97.50 on Friday, it’s highest since May 31. FxWirePro's Hourly Dollar Strength Index stood at 51.60 (Bullish) by 0500 GMT.
EUR/USD: The euro edged up, staying below a seven-month high set early June as projections after the first round of French parliamentary elections on Sunday showed that President Emmanuel Macron's party was set to secure a huge majority in France. The European currency traded 0.1 percent up at 1.1205, having touched a high of 1.1285 earlier this month, its highest since Nov 9. FxWirePro's Hourly Euro Strength Index stood at 1.97 (Neutral) by 0400 GMT. Investors’ attention will remain on the U.S. monthly budget statement, as the Eurozone's economic calendar remains absolutely data empty. Immediate resistance is located at 1.1239 (5-DMA), a break above targets 1.1300. On the downside, support is seen at 1.1166 (Previous Session Low), a break below could drag it near 1.1100.
USD/JPY: The dollar consolidated within a thin range after rising to a 1-week high in the previous session, as investors refrained from placing big bets ahead of a two-day U.S. Federal Reserve policy meeting that could give hints on the pace of possible U.S interest rate hikes over the rest of the year. The major traded flat at 110.30, having touched a high of 110.80 on Friday, its highest since Jun. 2. FxWirePro's Hourly Yen Strength Index stood at -113.50 (Highly Bearish) by 0400 GMT. Investors’ will continue to track broad based market sentiment, ahead of the U.S. monthly budget statement due later in the day. Immediate resistance is located at 110.60 (50.0% retracement of 112.12 and 109.11), a break above targets 111.00. On the downside, support is seen at 110.00 (5-DMA), a break below could take it near 109.50.
GBP/USD: Sterling recovered from seven-week lows above the 1.2700 handle as dust settled over the UK general election aftermath. The major tumbled on Friday after no single party won a clear claim to power in the UK election. Sterling traded 0.1 percent up at 1.2753, having hit a low of 1.2635 in the previous session, its weakest since Apr 18. FxWirePro's Hourly Sterling Strength Index stood at -77.01 (Slightly Bearish) by 0400 GMT. Investors’ focus now shifts on UK inflation report hearings, ahead of the FOMC and BoE monetary policy meeting scheduled later this week. Immediate resistance is located at 1.2800, a break above could take it near 1.2850. On the downside, support is seen at 1.2700, a break below targets 1.2650. Against the euro, the pound traded 0.1 percent down at 87.89 pence, having hit a near 5-month low of 88.59 on Friday.
AUD/USD: The Australian dollar steadied after easing from a 6-week high hit last week as the Australian market remained closed on account of the Queen's Birthday. The Aussie trades flat at 0.7527, having hit a high of 0.7566 on Wednesday, it’s strongest since Apr 25. FxWirePro's Hourly Aussie Strength Index stood at 83.06 (Slightly Bullish) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7519 (Previous Session Low), a break below targets 0.7499 (June 7 Low). On the upside, resistance is located at 0.7550, a break above could take it near 0.7586 (Apr 24 High).
NZD/USD: The New Zealand dollar declined from recent highs after the New Zealand Institute of Economic Research cut the economy's outlook for growth for last and this year. However, an upward revision from 2019 could underpin the major. The Kiwi trades 0.2 percent down at 0.7193, having touched a peak of 0.7222 on Thursday, its strongest level since Feb. 28. FxWirePro's Hourly Kiwi Strength Index was at 104.24 (Highly Bullish) by 0500 GMT. Investors’ will continue to track broad based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.7222 (June 8 High), a break above could take it near 0.7246 (Feb. 23 High). On the downside, support is seen at 0.7171 (78.6% retracements of 0.6988 and 0.7222), a break below could drag it till 0.7132 (61.8 retrace).
Equities Recap
Asian shares tumbled, weighed down by a slide in U.S. tech shares and caution ahead of this week's Federal Reserve policy meeting that could provide clues on the U.S. monetary outlook.
MSCI's broadest index of Asia-Pacific shares outside Japan edged down 0.4 percent
Tokyo's Nikkei declined 0.6 percent to 19,899.29 points, Australia's S&P/ASX 200 index surged 0.02 percent to 5,677.80 points and South Korea's KOSPI dropped 1.08 percent to 2,355.34 points.
Shanghai composite index fell 0.3 percent to 3,148.58 points, while CSI300 index was trading 0.02 percent up at 3,577.05 points.
Hong Kong’s Hang Seng was trading 1.1 percent lower at 25,730.17 points. Taiwan shares shed 0.9 percent to 10,109.96 points.
Commodities Recap
Crude oil prices rose, extending previous session gains as futures traders bet the market may have bottomed after a recent steep fall, although physical markets remain bloated by oversupply. International benchmark Brent crude was trading 0.4 percent up at $48.45 per barrel by 0411 GMT, having hit a low of $47.41 the day before, its weakest since May 5. U.S. West Texas Intermediate traded 0.5 percent up at $46.09 a barrel, after falling as low as $45.19 on Thursday, its lowest since May 5.
Gold prices steadied after falling to a 1-week low in the previous session as Asian stocks fell ahead of a two-day U.S. Federal Reserve policy meeting that could give hints on the pace of possible U.S interest rate hikes over the rest of the year. Spot gold was flat at $1,267.23 per ounce at 0415 GMT, having hit a peak of $1,295.89 an ounce on Tuesday, its strongest since Nov. 9. U.S. gold futures for August delivery were flat at $1,271.60.
Treasuries Recap
The 10-year U.S Treasury yield stood at 2.197 percent higher by 0.017 bps, while 5-year yield was 0.018 bps up at 1.781 percent.
The New Zealand bonds ended on a mixed tone in a silent trading session that witnessed no data of economic significance. Also, investors are eyeing the country’s first-quarter gross domestic product (GDP), scheduled to be released on June 15. At the time of closing, the yield on the benchmark 10-year bond jumped 2 basis points to 2.80 percent, the yield on 7-year note slipped 1 basis point to 2.69 percent while the yield on short-term 2-year note ended 1 basis point higher at 1.96 percent.
