Market Roundup
- EUR/USD -0.15%, USD/JPY -0.09%, GBP/USD 0.22%, EUR/GBP -0.35%
- DXY -0.03%, DAX -0.08%, FTSE -0.26%, Brent 0.08%, Gold 0.38%
- Chinese tariffs on U.S. goods to take effect at start of July 6 -source
- Great Britain Jun Markit/CIPS Service PMI, 55.1, 54.0 forecast, 54.0 previous
- EZ June Markit Composite Final PMI, 54.9, 54.8 forecast, 54.8 previous
- EZ June Markit Service Final PMI, 55.2, 55.0 forecast, 55.0 previous
- Germany June Markit Services PMI, 54.5, 53.9 forecast, 53.9 previous
- Germany June Markit Composite Final PMI, 54.8, 54.2 forecast, 54.2 previous
- France June Markit Services PMI, 55.9, 56.4 forecast, 56.4 previous
- France June Markit Composite PMI, 55.0, 55.6 forecast, 55.6 previous
- BOJ's Harada spurns rate hikes, seen supporting slow retreat from stimulus
- Singapore central bank warns trade rows sharply increase risk to global growth
- Malaysia's Najib charged with corruption, weeks after stunning ouster
Economic Data Ahead
- No major economic data releases
Key Events Ahead
- No significant event scheduled
FX Beat
DXY: The dollar index steadied after falling to a 1-week low earlier in the day as investors turned cautious ahead of July 6 deadline, when U.S. tariffs on $34 billion worth of Chinese goods take effect. The greenback against a basket of currencies trades 0.1 percent up at 94.65, having touched a low of 94.40 earlier, its lowest since June 26. FxWirePro's Hourly Dollar Strength Index stood at -118.43 (Highly Bearish) by 1100 GMT.
EUR/USD: The euro declined, reversing some of its previous session gains after data showed Euro zone business growth accelerated in June, but optimism among purchasing managers was at its lowest ebb since late 2016. The euro bloc's final Composite Purchasing Managers' Index rose to 54.9 in June from May's 54.1, above the 50 mark separating growth from contraction. The European currency traded 0.2 percent down at 1.1637, having touched a high of 1.1720 last week, its highest since June 14. FxWirePro's Hourly Euro Strength Index stood at -24.82 (Neutral) by 1100 GMT. Immediate resistance is located at 1.1700, a break above targets 1.1744 (June 4 High). On the downside, support is seen at 1.1628 (10-DMA), a break below could drag it till 1.1600.
USD/JPY: The dollar trimmed losses after falling to a near 1-week low as investors awaited the release of the Federal Reserve's June meeting minutes on Thursday for further clues on the U.S. monetary policy outlook. The major was trading 0.05 percent down at 110.50, having hit a low of 110.28 earlier, its lowest since June 28. FxWirePro's Hourly Yen Strength Index stood at -26.63 (Neutral) by 1100 GMT. Investors’ will continue to track broad-based market sentiment, as the U.S markets will remain shut in observance of Independence Day holiday. Immediate resistance is located at 110.75 (June 21 High), a break above targets 111.08 (June 18 High). On the downside, support is seen at 110.22 (21-DMA), a break below could take it lower 109.68 (June 27 Low).
GBP/USD: Sterling rallied to a 1-week peak after data released earlier showed Britain's services industry grew in June at its fastest rate since October, boosting expectations of a Bank of England interest rate hike next month. The economy's services Purchasing Managers' Index surprisingly rose to an 8-month high of 55.1 in June, surpassing forecast for it to remain unchanged at 54.0. The major traded 0.1 percent up at 1.3204, having hit a high of 1.3227 earlier; it’s highest since June 27. FxWirePro's Hourly Sterling Strength Index stood at 86.53 (Slightly Bullish) 1100 GMT. Immediate resistance is located at 1.3270, a break above could take it near 1.3314 (June 22 High). On the downside, support is seen at 1.3144 (5-DMA), a break below targets 1.3102 (June 21 Low). Against the euro, the pound was trading 0.2 percent up at 88.14 pence, having hit a high of 87.99 pence, it’s highest since June 27.
USD/CHF: The Swiss franc eased as the greenback rebounded from a 1-week low after new orders for U.S.-made goods unexpectedly rose in May, pointing to a strengthening manufacturing sector. The major trades 0.1 percent up at 0.9930, having touched a high of 0.9992 on Thursday, it’s highest since May 21. FxWirePro's Hourly Swiss Franc Strength Index stood at -39.00 (Neutral) by 1100 GMT. On the higher side, near-term resistance is around 0.9977 (June 19 High) and any break above will take the pair to next level till 1.0018 (May 18 High). The near-term support is around 0.9880 and any close below that level will drag it till 0.9855.
Equities Recap
European shares gained ahead of Washington's end of week deadline to impose tariffs on Chinese imports, while sterling rallied after a survey showed Britain's services industry gained momentum in June.
The pan-European STOXX 600 index rallied 0.1 percent at 380.37 points, while the FTSEurofirst 300 index surged 0.2 percent to 1,489.97 points.
Britain's FTSE 100 trades 0.2 percent down at 7,579.74 points, while mid-cap FTSE 250 fell 0.2 percent to 20,622.03 points.
Germany's DAX declined 0.1 percent at 12,339.97 points; France's CAC 40 trades 0.3 percent higher at 5,332.11 points.
Commodities Recap
Crude oil prices declined despite a second successive fall in U.S. crude inventories driven by an outage at the Syncrude Canada oil sands facility. International benchmark Brent crude was trading 0.6 percent down at $73.80 per barrel by 1105 GMT, having hit a high of $79.53 on Friday, its highest since May 31. U.S. West Texas Intermediate was trading 0.6 percent lower at $73.81 a barrel, after rising as high as $75.24 on Tuesday, its highest since Nov. 2014.
Gold rallied to a 1-week high, rebounding from this week's 7-month low, as a softer dollar and growing trade tensions boosted safe-haven assets. Spot gold was up 0.3 percent at $1,256.28 an ounce by 1111 GMT, having touched a low of $1237.82 on Tuesday, its lowest since Dec. 12.. U.S. gold futures for August delivery were trading 0.3 percent higher at $1,257.50 an ounce.
Treasuries Recap
The Japanese government bond prices were mostly firmer, supported by risk aversion in the broader financial markets. September 10-year JGB futures gained 0.03 point to 150.95. The 30-year JGB yield declined half a basis point to 0.840 percent and the 40-year yield was also half a basis point lower, at 0.840 percent.
The Australian bond futures were near multi-month peaks amid the general mood of risk aversion. The three-year bond contract added half a tick to 97.935, while the 10-year contract firmed 3 ticks to 97.4050. The New Zealand government bond yields were down around 2 basis points across the curve.
