Market Roundup
•UK Jul Retail Sales (YoY) 1.4%, 1.4% forecast,-0.2% previous
• UK Jul Core Retail Sales (YoY) 1.4%,1.4% forecast,-0.8% previous
• UK Jul Core Retail Sales (MoM) 0.7%,0.8% forecast,-1.5% previous
• UK Jul Retail Sales (MoM) 0.5%,0.6% forecast,-1.2% previous
•Swiss Industrial Production (YoY) (Q2) 7.30%,-2.90% forecast, -3.10% previous
•EU Jun Trade Balance 22.3B, 13.3B,13.9B previous
Looking Ahead Economic Data (GMT)
• 12:30 US Jul Building Permits (MoM) 3.9% previous
• 12:30 US Jul Building Permits 1.430M forecast,1.454M previous
• 12:30 US Jul Housing Starts 1.340M forecast,1.353M previous
• 12:30 Canada Jun Foreign Securities Purchases by Canadians 3.860B previous
• 12:30 US Jul Housing Starts (MoM) 3.0% previous
• 12:30 Canada Jun Manufacturing Sales (MoM) -2.3% forecast,0.4% previous
• 12:30 Canada Foreign Securities Purchases 15.90B forecast,20.89B previous
• 14:00 US Aug Michigan 1-Year Inflation Expectations 2.9% previous
• 14:00 US Aug Michigan 5-Year Inflation Expectations 3.0% previous
• 14:00 US Aug Michigan Consumer Sentiment 66.7 forecast,66.4 previous
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Summaries
EUR/USD: The euro strengthened against the dollar on Friday after data showed Trade balance in Eurozone surged in June. The euro area's trade surplus experienced a significant surge, largely driven by gains in the trade balance for machineries, vehicles, chemicals, and other manufactured goods. According to data released by Eurostat on Friday, the trade surplus expanded to EUR 22.3 billion in June, up from EUR 14.0 billion in May, far exceeding economists' forecast of EUR 13.3 billion. Eurostat attributed this improvement to several factors. The surplus for machineries and vehicles increased by EUR 2.9 billion, while chemicals saw a rise of EUR 1.2 billion. Additionally, the surplus for other manufactured goods also grew by EUR 1.2 billion. Furthermore, the trade deficit for energy narrowed by EUR 2.6 billion, contributing to the overall increase in the trade surplus. The euro was last up 0.16% against the greenback to $1.0984. Immediate resistance can be seen at 1.1025(23.6%fib), an upside break can trigger rise towards 1.1040(Higher BB).On the downside, immediate support is seen at 1.09844(Daily low), a break below could take the pair towards 1.0946(38.2%fib).
GBP/USD: Sterling touched a three-week high on Friday as retail sales data added to signs of positive momentum in the UK economy, with gains underpinned by a broad recovery in risk appetite. Data revealed that British retail sales rose by 0.5% in July, partially driven by increased spending during the men's Euros soccer championship. This modest gain followed a 0.9% decline in June, when unusually cool and wet weather deterred shoppers. Additionally, UK gross domestic product (GDP) grew by 0.6% in the second quarter of 2024, aligning with economists' expectations. The pound climbed 0.4% against the dollar to $1.2904 on Friday - its strongest level since July 25. Immediate resistance can be seen at 1.2920(23.6%fib), an upside break can trigger rise towards 1.2937(July 24th high).On the downside, immediate support is seen at 1.2812(38.2%fib), a break below could take the pair towards 1.2743(50%fib).
USD/CHF: The dollar steadied against the Swiss franc on Friday after encouraging U.S. economic data soothed fears of a recession. Recent data has helped restore confidence that had been undermined by a surprisingly weak employment report earlier this month. The data also boosted optimism about improving inflation, as reflected in the recent releases of the producer price index (PPI) and consumer price index (CPI) for July. While traders are convinced that the Federal Reserve will cut interest rates on September 18, there has been some debate over the size of the reduction. According to the CME Group's FedWatch Tool, the odds of a 50 basis-point cut have decreased to 25%, down from 36% a day earlier. Immediate resistance can be seen at 0.8707 (38.2%fib), an upside break can trigger rise towards 0.8773(50%fib).On the downside, immediate support is seen at 0.8606(23.6%fib), a break below could take the pair towards 0.8503(Lower BB).
USD/JPY: The dollar hovered around two-week high against the yen on Friday after its biggest one-day gain against major peers in four weeks as firm U.S. economic data all but eliminated fears of a recession. The dollar retreated 0.24% slightly to 148.935 yen, but was still close to Thursday's high of 149.40, a level last seen on Aug. 2. On Thursday, the Commerce Department reported that retail sales surged by 1.0% last month, significantly exceeding forecasts of a 0.3% increase. In addition, separate data revealed that 227,000 Americans filed for unemployment benefits last week, fewer than the anticipated 235,000. While traders are confident that the Federal Reserve will cut interest rates on September 18, the size of the reduction remains a topic of debate. Strong resistance can be seen at 149.55(38.2 %fib), an upside break can trigger rise towards 150.00(Psychological level). On the downside, immediate support is seen at 147.88(Daily low), a break below could take the pair towards 146.23(23.6 %fib).
Equities Recap
European shares gained for the fourth straight session on Friday, as upbeat risk sentiment prevailed across global markets following a strong U.S. retail sales data.
UK's benchmark FTSE 100 was last trading down at 0.54 percent, Germany's Dax was up by 0.53 percent, France’s CAC finished was up by 0.15 percent.
Commodities Recap
Gold prices edged up on Friday and were set for a weekly gain on growing optimism about a September U.S. rate cut, although expectations the Federal Reserve will ease aggressively have been tempered ahead of Chair Jerome Powell's upcoming speech.
Spot gold was up 0.3% at 2,462.82 per ounce, as of 1002 GMT and has gained more than 1% so far this week. U.S. gold futures rose 0.3% to $2,500.50.
Oil prices dropped by more than $2 on Friday, heading for a weekly decline as Brent crude slipped below $80 a barrel, drop was driven by a series of disappointing economic indicators from China for July, which overshadowed concerns about geopolitical risks.
Brent crude futures were down $2.19, or 2.70%, to $78.85 per barrel by 1151 GMT, while U.S. West Texas Intermediate crude futures fell $2.39, or 3.06%, to $75.77.
