Daily Market View-U.S Stock Market

The S&P 500 hit a record high for the fourth straight session yesterday, helped by shares of heavyweight technology firms and banks, while an upbeat consumer confidence report set a positive tone for the key jobs report at the end of the week. U.S consumer confidence increased in June to its highest level since the COVID-19 pandemic started more than a year ago, bolstering expectations for strong economic growth in the second quarter. Market participants are closely watching the non-farm payroll report on Friday that could pave way for the U.S. Federal Reserve’s policy stance which hinges on an equitable recovery of the labor market. Ten of the 11 major S&P sectors rose in early trading, with energy, materials, and industrials among the top gainers after lagging in the past few sessions. All the three major Wall Street indexes are set for their fifth straight quarter of gains, boosted by ultra-loose monetary policy, a rebounding U.S economy, and robust corporate earnings.

Dow Jones Industrial Average

 The Dow Jones Industrial Average added 0.03%. The biggest gainers of the session on the Dow Jones Industrial Average were Nike Inc., which rose 2.38% or 3.62 points to trade at 155.98 at the close. Home Depot Inc. added 1.26% or 3.97 points to end at 318.25 and Apple Inc. was up 1.15% or 1.55 points to 136.33 in late trade. The biggest losers included Boeing Co, which lost 1.75% or 4.19 points to trade at 235.77 in late trade. Walt Disney Company declined 1.51% or 2.66 points to end at 173.91 and Intel Corporation shed 1.25% or 0.72 points to 56.76.

NASDAQ 100

The NASDAQ index gained 0.19%. The top performers on the NASDAQ were BSQUARE Corporation which rose 206.11% to 8.020, Cerevel Therapeutics Holdings Inc. which was up 134.69% to settle at 29.50 and Marin Software Inc. which gained 129.47% to close at 17.2100. The worst performers were DiaMedica Therapeutics Inc. which was down 33.89% to 4.740 in late trade, ReShape Lifesciences Inc. which lost 28.27% to settle at 5.480, and Mediwound Ltd which was down 28.01% to 4.060 at the close.

Oil

Oil prices today extended the previous day's small gains after an industry report showed U.S crude stockpiles fell last week, overriding trader and investor concerns about transportation curbs in some countries as COVID-19 cases surge. U.S crude was up 41 cents, or 0.6% at $73.39 a barrel, having risen 0.1% in the previous session. While the highly contagious Delta variant of the coronavirus is taking hold in many countries, prompting new lockdowns or movement restrictions from Australia to Portugal, hopes of a broader recovery in demand for fuel remained intact. On the last day of June, U.S crude is heading for another monthly gain, which would mean the contract has risen for six out of the last seven months. Crude stocks in the United States were down by 8.2 million barrels, American Petroleum Institute data showed, according to two sources, who spoke on condition of anonymity. Still, gasoline inventories rose by 2.4 million barrels and distillate stocks were up by 428,000 barrels.

Precious and Base Metals

Gold prices held steady today as investors were cautious ahead of U.S jobs data due later this week, but prices were set to post their worst month since November 2016 on the U.S Federal Reserve’s shift to a hawkish policy stance. Spot gold was steady at $1,761.80 per ounce. U.S gold futures fell 0.1% to $1,761.80. For the month, prices were down 7.6%. For the quarter, gold had risen 3.2%. Federal Reserve Governor Christopher Waller on Tuesday said he is “very optimistic” about the economy, and while he declined to say when he thinks the Fed should start raising interest rates, he said it could be next year. U.S consumer confidence jumped to its highest level in nearly 1-1/2 years in June as growing labor market optimism amid a reopening economy offset concerns about higher inflation. The U.S Labor Department’s nonfarm payrolls data on Friday is expected to show a gain of 690,000 jobs this month, compared with 559,000 in May, according to a Reuters poll. Gold is seen as a hedge against inflation, although a Fed rate hike will increase the opportunity cost of holding bullion and dull its appeal. Silver rose 0.3% to $25.81 per ounce. Palladium gained 0.4% at $2,686.81 and was headed for a fourth straight quarterly gain. Platinum rose 0.2% to $1,068.96 and was set to post its worst quarter and month since March last year. Copper prices rose today but were set for their smallest quarterly gain since March 2020 on pressure from a firm dollar and top consumer China’s efforts to tame a red-hot metals rally. Copper prices have pulled back in recent weeks after hitting a record high in May on the back of a global economic recovery, rising investments into renewable energy and electric vehicles, as well as a tight supply outlook. Some of the pressure has come from China, with the world’s second-largest economy releasing state reserves of copper.

Traditional Agricultures

Soybean futures edged higher today, as traders adjusted positions ahead of a U.S government report on stock and acreage, while corn prices eased. Wheat futures ticked higher although expectations of strong output in Russia, the world’s biggest exporter, capped gains.

Disclaimer

This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.

FOREX-Pulse of the Market

The dollar hovered below a two-month high versus major counterparts today, with traders largely sidelined ahead of a closely watched U.S. jobs report, which could sway the timing of an exit from Federal Reserve stimulus. The dollar index, which tracks the greenback against a basket of six major currencies, was at 91.884 early in the Asian session after retreating from as high as 92.408 on June 18, in the week the Federal Open Market Committee shocked markets by predicting two interest rate hikes by end-2023. The Fed commentary since then has put the focus on the data to determine when tapering of asset purchases and higher rates are appropriate, with Chair Jerome Powell saying a weak ago that policymakers won't act on just the "fear" of inflation, and will encourage a "broad and inclusive" job market recovery. The U.S. Labor Department is expected to report a gain of 690,000 jobs in June, compared with 559,000 in May, and an unemployment rate of 5.7% versus 5.8% in the previous month, according to a Reuters poll of economists. Investors are also looking at U.S consumer confidence data today as well as the Institute for Supply Management's manufacturing index on Thursday for clues as to where interest rates are headed. Both the dollar and yen benefited from some safe-haven demand as the more contagious Delta strain of the novel coronavirus spread in Asia and elsewhere, stoking fears of further lockdowns. The market had been positioned long of the single currency on optimism regarding the vaccine catch-up trade in the region but forecasts that the Delta variant of COVID could spread through Europe in the summer months could now be undermining confidence in this trade. Assuming the U.S. data remains broadly supportive, we expect the USD to grind moderately higher vs. the EUR through the course of the year. Sterling rose yesterday as traders brace for the end of the worst month versus the dollar since September, with the focus moving to political risks this week. Sterling was one of the worst-performing G-10 currencies last week after the Bank of England kept the size of its stimulus program unchanged.

Еuro

The single currency nudged lower yesterday, with investors awaiting direction from key economic data later in the week. Euro-dollar implied volatility gauges with a one-year maturity were close to their lowest since March 2020. Currency markets were generally quiet, with the U.S. dollar index up 0.2% on the day. Overall, the EUR/USD traded with a low of 1.1916 and a high of 1.1955 before closing the day around 1.1930 in the New York session.

Yen

The Japanese Yen benefited from some safe-haven demand as the more contagious Delta strain of the novel coronavirus spread in Asia and elsewhere, stoking fears of further lockdowns. Investors are also looking at U.S consumer confidence data today as well as the Institute for Supply Management's manufacturing index on Thursday. Overall, the USD/JPY traded with a low of 110.67 and a high of 111.09 before closing the day around 110.84 in the U.S session.

British Pound

The British Pound rose as traders brace for the end of the worst month since September, with the focus moving to political risks this week. This month, sterling dropped for the first time since April below $1.38 against a strengthening dollar after the U.S Federal Reserve surprised markets by signaling it would raise interest rates sooner than expected. Overall, the GBP/USD traded with a low of 1.3888 and a high of 1.3984 before closing the day at 1.3920 in the New York session.

Canadian Dollar

The Canadian Dollar weakened against its U.S counterpart yesterday as investors weighed rising coronavirus cases in Australia and Asia, with the currency giving back some of last week's advance. Canada's GDP report for April is due later today which could offer clues on the strength of the economy. Overall, USD/CAD traded with a low of 1.2279 and a high of 1.2338 before closing the day at 1.2321 in the New York session.

Australian Dollar

The Australian Dollar weakened today after cautious investors cut down on risk amid concerns over rising COVID-19 cases and as the greenback strengthened on growing bets of higher U.S interest rates. The Aussie fell sharply overnight after Boston Federal Reserve President Eric Rosengren raised the chances of higher interest rates to manage the rapid gains seen in the U.S. housing market. Overall, AUD/USD traded with a low of 0.7552 and a high of 0.7599 before closing the day at 0.7565 in the New York session.

Euro-Yen

EUR/JPY is trading below 14 and above 50, 100 days moving average. Fast stochastic is giving a bullish tone and MACD is issuing a bearish stance. The Relative Strength Index is above 43 and lies above the neutral zone. In general, the pair has lost 0.04%.

Sterling-Yen

Currently, GBP/JPY is trading below 14 and above 50, 100 days moving average. Fast stochastic is issuing a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 44 reading and lies above the neutral zone. On the whole, the pair has lost 0.37%.

Aussie-Yen

Currently, the cross is trading above 14, 50, and 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 43 reading and lies above the neutral region. In general, the pair has gained 0.02%.

Euro-Sterling

This cross is currently trading below 14, 50, and 100 days moving average. Fast stochastic is indicating a bullish tone and MACD is also issuing a bullish signal. The Relative Strength Index is above 49 and lies below the neutral region. Overall, the pair has gained 0.34%.

Sterling-Swiss

This cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The Relative Strength Index is above 52 and lies below the neutral region. In general, the pair has lost 0.32%.

Disclaimer

This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.

Daily Market View-U.S Stock Market

The S&P 500 and the NASDAQ were on pace to open near record levels as tech-related growth stocks edged up, while investors awaited data on the health of a U.S labor market recovery and corporate earnings later in the week. Nasdaq 100 was up 40 points, or 0.28%, with Microsoft Corp, Amazon.com Inc., and Facebook Inc. adding about half a percent in premarket trading. The S&P 500 on Friday logged its best weekly performance in 20 following a bipartisan agreement on a $1.2 trillion infrastructure spending deal and waning concerns about a sooner than expected policy tightening from the Federal Reserve. Both the S&P 500 and the NASDAQ hit a series of record highs last week. But the NASDAQ’s 4.4% gain is outpacing its peers in June as investors pile back into tech-oriented growth stocks on waning worries about runaway inflation. Quarterly results from Micron Technology, ConocoPhillips and Walgreens are slated for this week. On the economic front, attention will be on consumer confidence data, a private jobs report, and a crucial monthly employment report.

Dow Jones Industrial Average

The Dow Jones Industrial Average declined 0.44%. The best performers of the session on the Dow Jones Industrial Average were Intel Corporation, which rose 2.81% or 1.57 points to trade at 57.48 at the close. Meanwhile, Microsoft Corporation added 1.41% or 3.73 points to end at 268.75, and Apple Inc. was up 1.25% or 1.66 points to 134.77 in late trade. The worst performers of the session were Boeing Co, which fell 3.39% or 8.42 points to trade at 239.96 at the close. Chevron Corp declined 3.09% or 3.32 points to end at 103.98 and American Express Company was down 2.76% or 4.68 points to 164.77.

NASDAQ 100 

The NASDAQ index gained 0.98%. The top performers on the NASDAQ Composite were Marin Software Inc. which rose 92.65% to 7.3400, QAD Inc. B which was up 79.81% to settle at 86.31, and Intellia Therapeutics Inc. which gained 50.19% to close at 133.41. The worst performers were Exelixis Inc. which was down 23.01% to 18.03 in late trade, Kiromic Biopharma Inc. which lost 19.00% to settle at 8.100, and Oblong Inc. which was down 17.30% to 3.275 at the close.

Oil

Oil prices fell 2% to a one-week low yesterday after hitting their highest since 2018 earlier in the session, as a spike in COVID-19 cases in Asia and Europe put a brake on the rally before this week's OPEC+ meeting. U.S crude fell $1.14, or 1.5%, to settle at $72.91. Those declines pushed both contracts out of the overbought territory and were their lowest close since June 18. Earlier in the volatile session, both benchmarks rose to their highest levels since October 2018. The forecast for oil demand recovery over the summer may be a bit overestimated, and traders are facing a reality check this week as the (COVID-19) Delta variant reached Europe and as an infections surge in Southeast Asia and Australia is bringing back lockdowns. Indonesia is battling record-high cases, Malaysia is set to extend a lockdown and Thailand has announced new restrictions. All eyes this week will be on the Organization of the Petroleum Exporting Countries and its allies, a group known as OPEC+, to see what happens at their meeting on Thursday.

Precious and Base Metals

Gold prices eased today, as a firmer dollar made bullion expensive for holders of other currencies while concerns that the U.S. Federal Reserve will tighten its monetary policy sooner than expected also dented the metal’s appeal. Gold is seen as a hedge against inflation, though a rate hike by the Fed will increase the opportunity cost of holding bullion and dull its appeal. Spot gold was down 0.2% at $1,775.42 per ounce. U.S gold futures fell 0.2% to $1,776.40. The dollar index strengthened 0.1% against rivals. The Fed has made “substantial further progress” towards its inflation goal in order to begin tapering asset purchases, Fed Bank of Richmond President Thomas Barkin said yesterday. The supply chain imbalances and higher demand currently leading to higher inflation are transitory and the Fed has the tools to respond if inflation remains elevated for longer than anticipated, Fed Vice Chair for Supervision Randal Quarles said yesterday. European Central Bank policymakers yesterday started a public debate about ending emergency bond purchases launched at the start of the coronavirus pandemic last year, with fault lines already emerging between so-called hawks and doves. Bullion tends to fall out of favor amid tighter monetary policy. China’s net gold imports via Hong Kong more than halved in May from the prior month, when they touched the highest level in nearly three years, as demand faltered amid fresh coronavirus-led restrictions. SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.3% to 1,045.78 tonnes yesterday from 1,042.87 tonnes on Friday. Silver eased 0.2% at $26.03 per ounce, palladium slipped 0.1% to $2,683.19. Platinum was steady at $1,090.33. Copper edged lower yesterday as slowing profit growth in industrial firms in top consumer China metals, rising inventories, and low premiums sapped enthusiasm for the metal.

Traditional Agricultures

Soybean futures slid today ahead of a key U.S. report on planted acres, although forecasts for heat in the western U.S Midwest limited losses. Corn also fell, while wheat ticked higher. Hot weather is a real and a longer-term concern. The market is awaiting key U.S acreage and stocks data due on Wednesday.

Disclaimer

This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.

Forex-Pulse of the Market

The dollar held firm today in the Asian session after slightly softer-than-expected U.S inflation did little to chip away investors’ conviction that the Federal Reserve could tighten monetary policy if consumer price pressures continue to intensify. The dollar’s index against six other major currencies was steady at 91.793, having recovered from Friday’s low of 91.524 hit in the wake of the inflation readings. The U.S personal consumption expenditures (PCE) price index, excluding the volatile food and energy components, increased 0.5% after advancing 0.7% in April. In the 12 months through May, the so-called core PCE price index, the Fed’s favorite gauge of inflation, shot up 3.4%, the largest gain since April 1992. Although inflation is expected to slow towards the year-end, signs of a tight labor market kept many investors fretting over wage-driven price pressures. Among a raft of economic indicators due this week, Friday’s payroll data is a key focus, with economists expecting an increase of 675,000 nonfarm payrolls. Depending on the outcome of the payroll’s data, the market could start pricing in more chances of a rate hike next year. December 2022 Fed funds rates futures are almost fully pricing in a 0.25 percentage point rate hike by the end of next year. The general mood around an ongoing economic recovery remained solid, as Republican Senate negotiators on an infrastructure deal were optimistic about a $1.2 trillion bipartisan bill after President Joe Biden withdrew his threat to veto the measure unless a separate Democratic spending plan also passes Congress. Cryptocurrencies bounced back from their weekend lows but ended the week lower. Sterling edged lower on Friday and was on track for its worst month against the dollar since September after the Bank of England kept its policy unchanged. The BoE on Thursday kept the size of its stimulus program at the same level and left its benchmark interest rate at an all-time low of 0.1%. It also said inflation would surpass 3% as Britain's economy reopens, but the climb further above its 2% target would only be temporary. Investors had hoped a more optimistic economic assessment from the BoE would push sterling back towards $1.40. News of the rapid spread of the Delta Covid-19 variant in Britain has also weighed marginally on sentiment. The euro zone is recovering faster than earlier expected, but still needs continued fiscal and monetary support so that the pandemic does not leave scars, ECB head Lagarde told European Union leaders on Friday.

Euro

The single currency gained as the euro zone is recovering faster than earlier expected, but still needs continued fiscal and monetary support so that the pandemic does not leave scars, European Central Bank head Christine Lagarde told European Union leaders on Friday. Fiscal and monetary policy continue to play their role in underpinning economic activity. Overall, the EUR/USD traded with a low of 1.1916 and a high of 1.1955 before closing the day around 1.1930 in the New York session.

Yen

The Japanese Yen fell today in Asian session as the dollar held firm after slightly softer-than-expected U.S inflation did little to chip away investors’ conviction that the Federal Reserve could tighten monetary policy if consumer price pressures continue to intensify. The U.S (PCE) price index, excluding the volatile food and energy components, increased 0.5%. Overall, the USD/JPY traded with a low of 110.67 and a high of 111.09 before closing the day around 110.84 in the U.S session.

British Pound

The British Pound edged lower on Friday and was on track for its worst month against the dollar since September after the Bank of England kept its policy unchanged. The BoE on Thursday kept the size of its stimulus program at the same level and left its benchmark interest rate at an all-time low of 0.1%. Overall, the GBP/USD traded with a low of 1.3888 and a high of 1.3984 before closing the day at 1.3920 in the New York session.

Canadian Dollar

The Canadian Dollar edged higher on Friday as oil prices climbed and investors grew less worried about the Federal Reserve's shift to more hawkish guidance, with the currency adding to this week's gains. Oil, one of Canada's major exports, notched a fifth consecutive week of gains on expectations demand growth will outstrip supply. Overall, USD/CAD traded with a low of 1.2279 and a high of 1.2338 before closing the day at 1.2321 in the New York session.

Australian Dollar

The Australian Dollar rose for a fifth consecutive session on Friday as analysts predict further gains in the period ahead led by strong commodity prices and still-buoyant risk appetite. The Aussie, a liquid proxy for risk, reached 80 U.S cents in February led by a global optimism about stronger global economic growth, successful vaccine rollouts in the United States and buoyant commodities prices. Overall, AUD/USD traded with a low of 0.7577 and a high of 0.7614 before closing the day at 0.7592 in the New York session.

Euro-Yen

EUR/JPY is trading below 14 and above 50, 100 days moving average. Fast stochastic is giving a bullish tone and MACD is issuing a bearish stance. The Relative Strength Index is above 47 and lies above the neutral zone. In general, the pair has lost 0.04%.

Sterling-Yen

Currently, GBP/JPY is trading below 14 and above 50, 100 days moving average. Fast stochastic is issuing a bearish tone and MACD is also indicating a bearish stance. The Relative Strength Index is above 48 reading and lies above the neutral zone. On the whole, the pair has lost 0.37%.

Aussie-Yen

Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also indicating a bullish stance. The Relative Strength Index is above 45 reading and lies above the neutral region. In general, the pair has gained 0.02%.

Euro-Sterling

This cross is currently trading below 14, 50 and 100 days moving average. Fast stochastic is indicating a bullish tone and MACD is also issuing a bullish signal. The Relative Strength Index is above 49 and lies below the neutral region. Overall, the pair has gained 0.34%.

Sterling-Swiss

This cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The Relative Strength Index is above 50 and lies below the neutral region. In general, the pair has lost 0.32%.

Disclaimer

This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.

Daily Market View-U.S Stock Market

Global stock markets moved higher on Friday after Thursday's breakthrough in Washington talks to secure a bipartisan infrastructure deal, while oil prices headed toward a fifth consecutive weekly gain on hopes for demand growth. Investors have been looking to an infrastructure agreement to extend the U.S. recovery after massive fiscal stimulus helped the economy grow at a 6.4% annualized rate in the first quarter. The plan is valued at $1.2 trillion over eight years, of which $579 billion is new spending. The S&P 500 index hit a record high on Friday, boosted by gains in Nike and bank stocks. Oil prices were on track for a fifth consecutive weekly gain as growth in demand is expected to outstrip supply on bets that OPEC+ producers will be cautious in returning more output to the market. Inflation has been front-and-center of investors' minds, with the latest U.S personal consumption expenditures (PCE) data showing a measure of underlying inflation rose less than expected in May. Core PCE rose 3.4% year-over-year, above the Fed's 2% flexible target.

Dow Jones Industrial Average

The Dow Jones Industrial Average gained 0.69%. The biggest gainers of the session on the Dow Jones Industrial Average were Nike Inc., which rose 15.53% or 20.75 points to trade at 154.35 at the close. UnitedHealth Group Incorporated added 1.49% or 5.94 points to end at 404.81 and Procter & Gamble Company was up 1.43% or 1.90 points to 134.92 in late trade. The biggest losers included Caterpillar Inc., which lost 1.39% or 3.04 points to trade at 216.30 in late trade. Boeing Co declined 0.91% or 2.27 points to end at 248.30 and Microsoft Corporation shed 0.61% or 1.64 points to 265.05.

NASDAQ 100 

The NASDAQ index declined 0.06%. The top performers on the NASDAQ Composite were Ikonics Corporation which rose 63.01% to 18.42, Fuwei Films Holdings Co Ltd which was up 38.27% to settle at 12.320 and Alfi Inc. which gained 32.14% to close at 16.980. The worst performers were Globus Maritime Ltd which was down 26.71% to 4.060 in late trade, Oasis Midstream Partners LP which lost 14.25% to settle at 23.95, and Biomea Fusion Inc. which was down 13.49% to 13.47 at the close.

Oil

Oil prices climbed to their highest since October 2018 on Friday, putting both benchmarks up for a fifth week in a row on expectations demand growth will outstrip supply and OPEC+ will be cautious in returning more crude to the market from August. U.S West Texas Intermediate (WTI) crude rose 75 cents, or 1.0%, to $74.05. Those were the highest closes for both benchmarks since October 2018 and put both contracts up over 3% for the week. Crude prices rallied on an improving demand outlook and over expectations, the market will remain tight as OPEC+ is likely to only deliver a small boost to output at the July 1st ministerial meeting. All eyes are on the Organization of the Petroleum Exporting Countries, Russia and allies - together called OPEC+ - who is due to meet on July 1 to discuss the further easing of their output cuts from August. The prospect of sanctions on Iran being lifted and more of its oil hitting the market anytime soon has dimmed.

Precious and Base Metals

Gold prices inched higher today, as the dollar eased and tamer-than-expected U.S. inflation data allayed fears of an early monetary policy tightening by the Federal Reserve. Spot gold was up 0.1% at $1,781.19 per ounce. U.S gold futures rose 0.1% to $1,780.30. The dollar index eased 0.1% against rivals, making gold cheaper for holders of other currencies. U.S consumer spending paused in May, while the personal consumption expenditures price index, the Fed’s preferred inflation measure, came in below expectations. Minneapolis Fed President Neel Kashkari said on Friday he expected recent high inflation readings would not last and Americans would return to the labor market in large numbers in the fall. Republican Senate negotiators on an infrastructure deal were optimistic about a $1.2 trillion bipartisan bill on Sunday after President Joe Biden withdrew his threat to veto the measure unless a separate Democratic spending plan also passes Congress. On the physical front, the gold market in top consumer China flipped into a premium last week as prices eased although activity was subdued, while buyers in India held off for a sharper dip in rates as more jewelers opened up. Speculators cut their net long position in gold by 38,288 contracts to 76,163 in the week to June 22, data from the Commodity Futures Trading Commission showed on Friday. Silver was steady at $26.07 per ounce, palladium rose 0.2% to $2,641.38. Platinum eased 0.1% to $1,109.64. Copper prices held steady on Friday after U.S President Joe Biden embraced a bipartisan Senate infrastructure deal valued at $1.2 trillion over eight years, which helped reinforce expectations of stronger demand. However, worries about the U.S Federal Reserve tightening monetary policy sooner than expected subdued some of the optimism and weighed on copper prices in afternoon trade

Traditional Agricultures

Corn and soybean futures tumbled on Friday after a U.S. Supreme Court ruling bolstered a bid by small oil refineries seeking exemptions from laws requiring them to blend ethanol or other biofuels into their products. Corn and soybeans also faced pressure from rains across large swaths of key U.S growing areas.

Disclaimer

This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.

Trading Week Ahead

The risk was mainly back on call last week as we saw stocks, indices, and forex majors post solid gains. Forex wise the action was centered around the Japanese Yen as buyers moved out of the safe-haven. The USD traded in a mixed week pulling back heavy losses to the AUD and EUR but failed to hold a firm GBP.

Currencies saw solid gains to the JPY during last week with the USD, GBP, and EUR leading the majors. The USDJPY moved back into the 109 handles and broke the 109.82 high. The GBPJPY re-took 155 and tested 156.

Buyers maintained a 5-week winning streak. The EURJPY broke 133 and cleared 133.46 April high. Yields were seen as a driver for the USD gains. Locally, Japan remains under pressure with a state of emergency looking to be extended due to the current COVID situation and murmurs the Olympics could still be canceled. If they were to be canceled this could erase current gains. Adding to the situation the Japanese jobless rate rose and prices fell.

Stocks globally saw a solid week. Sticking with Japan, despite local worries, the Nikkei saw a higher week as the JPN225 saw gains of over 2%. Locally, the ASX200 had a great week. Friday’s session saw 1.19% added with new records reached after the index closed at 7179.50. The ASX joining other indexes in pulling back all of the 2020 COVID sell-off. The commodity surge and strong financial sector helped the ASX200 move into record territory.

US indexes also found some direction despite a miss in US preliminary GDP that came in at 6.4%. President Biden will present a $6 trillion budget to boost the middle-class infrastructure. This will take the United States to its highest sustained levels of federal spending since World War II, running deficits above $1.3 trillion throughout the next decade. Chips remain a talking point as the shortage continues, the Democrats and GOP look to be teaming up a bill that targets China. US automakers continue to take the brunt of the shortages. US jobless claims fell to 406K, a new pandemic low and this data was one of the key drivers for equities. The Dow, S&P500, and Nasdaq all posted solid gains with the Dow and SP starting to close in on May records.

US optimism has been a driver in Europe as we saw a few indexes move back into record territory late last week. The EUStoxx600 and Germany’s DAX hitting fresh records in Friday’s session.

Oil bounced back last week. Buyers taking prices back above $67 and shaking off weakness seen in the week prior. Positive US data and reopening optimism maintained buyer demand. This week traders will be focused on Tuesday’s OPEC meeting. Gold saw gains erased which could be a sign of profit-taking moving into a hot market. Inflation remains on the radar, but a stronger USD at the end of last week could be having an impact.

We finish with Bitcoin. China and now Japan continue to negative government influence topic. China banned cryptocurrencies which added to jitters and could be seen as a key reason the crypto dropped like a stone. Last week Japan voiced its concerns around cryptocurrencies and we see what was looking like a firm recovery come undone late in the week. Bitcoin traded as high as 40,903 before falling back down to the 35K handle. Price continues to sit around the 50% Fibonacci retracement point but a close below the 61.8% point starts to paint a worrying picture.

Looking Ahead

This week's focus will be on Friday’s US employment data. Last data we saw a shock to the downside. With Canadian data also being released could we see more trading opportunities on the USDCAD and CAD pairs? To add a little more spice Fed Chair Powell will be speaking one and half hours before the employment data release.

Other points of interest will be US services and manufacturing PMI data, Australian GDP and OPEC meetings. Stock indexes will remain in focus with indexes either at or close to records. Bitcoin remains on the radar as buyers look to be stalling in holding their fightback rally after a really big fall from grace.

Disclaimer

This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.