Daily Market View-U.S Stock Market-The S&P 500 hit a record high yesterday, lifted by Tesla

The S&P 500 hit a record high yesterday, lifted by Tesla and bank stocks as investors awaited the start of the second-quarter earnings season and a batch of economic data. The NASDAQ also hit an all-time high before receding into negative territory. Seven of the 11 major S&P sector indexes advanced; financials and real estate led the way. Tesla jumped 3.6%. Tesla CEO Elon Musk insisted in court on Monday he does not control Tesla and said he did not enjoy being the electric vehicle company’s chief executive as he took the stand to defend the company’s 2016 acquisition of SolarCity. JPMorgan Chase added almost 2%, and the two shares contributed more to the S&P 500’s gains than any other stocks. Focus this week will also be on a series of economic reports, including headline U.S inflation data and retail sales. As well, Federal Reserve Chair Jerome Powell is due to appear before Congress on Wednesday and Thursday for views on inflation.

Dow Jones Industrial Average

 The Dow Jones Industrial Average rose 0.36% to hit a new all-time high. The biggest gainers of the session on the Dow Jones Industrial Average were Walt Disney Company., which rose 4.20% or 7.43 points to trade at 184.47 at the close. Goldman Sachs Group Inc. added 2.35% or 8.74 points to end at 380.50 and JPMorgan Chase & Co was up 1.64% or 2.55 points to 158.32 in late trade. The biggest losers included Cisco Systems Inc., which lost 0.91% or 0.49 points to trade at 53.25 in late trade. Salesforce.com Inc. declined 0.89% or 2.18 points to end at 242.88 and Boeing Co shed 0.59% or 1.41 points to 238.18.

NASDAQ 100

 The NASDAQ index gained 0.21%. The top performers on the NASDAQ Composite were Mediaco Holding Inc. which rose 311.86% to 17.010, State Auto Financial Corporation which was up 191.43% to settle at 50.30 and SGOCO Group Ltd which gained 103.58% to close at 19.930. The worst performers were Toughbuilt Industries Inc. which was down 33.01% to 0.7034 in late trade, UTStarcom Holdings Corp which lost 20.41% to settle at 1.5600 and Newegg Commerce Inc. which was down 19.13% to 37.76 at the close.

Oil

Oil slumped today over concerns about spreading COVID-19 variants derailing the global economic recovery that has brought fuel demand to near pre-pandemic levels, while tight crude supplies kept prices from falling lower. U.S West Texas Intermediate crude for August settled at $74.10 a barrel, down 46 cents, or 0.6%. Tokyo re-imposed pandemic-related restrictions due to concerns over coronavirus infections, less than two weeks before the city hosts the Summer Olympic Games. The spread of new variants and unequal access to vaccines threaten the global economic recovery, finance chiefs of the G20 large economies said over the weekend. The remarks weighed on the oil demand outlook. Traders are now refocusing on the spread of the COVID-19 pandemic and global concerns over the new variants' expansion. Helping to limit oil price losses, stockpiles in the biggest crude producing nation continued to tighten, with U.S inventories falling to the lowest since February 2020 in the week to July 2.

Precious and Base Metals

Gold prices fell yesterday, set for their biggest drop in nearly two weeks, as a bounce in dollar and buoyant equities dimmed the safe-haven metal’s appeal. Spot gold fell 0.4% to $1,800.96 per ounce. U.S gold futures dropped 0.6% to $1,799.30 per ounce. While there have been some concerns over the highly contagious Delta variant of the coronavirus, the more optimistic side of the market sees this as temporary and thinks economic growth and inflationary pressures might return sooner, preventing any sort of convincing recovery in gold prices in the near term. Asian shares rallied after Wall Street posted record closing highs on Friday, while the dollar index inched up 0.1% after declining for two sessions. The bullion was likely to draw support from lingering Delta variant concerns that could hamper the pace of global economic recovery and persistent loose monetary policies. Market participants now await U.S data including consumer price index today, and Federal Reserve Chair Jerome Powell’s testimony on Wednesday and Thursday for cues on the timeline for policy tightening. A surprise hawkish tilt by the Fed had sent gold in June to its worst month since November 2016. Higher interest rates increase the opportunity cost of holding bullion, which pays no interest. On the technical front, spot gold still targets $1,789 per ounce, as it failed a few times to break a resistance zone of $1,813-$1,818. Among other precious metals, silver fell 0.4% to $25.98 per ounce, palladium eased 0.2% to $2,802.68 per ounce and platinum dropped 0.9% to $1,093.58. Copper rose today on top metals consumer China’s move to boost liquidity, while a steady dollar ahead of U.S inflation data kept London prices under pressure. China will cut the amount of cash that banks must hold as reserves, releasing around 1 trillion yuan in long-term liquidity to underpin its post-COVID economic recovery that is starting to lose momentum.

Traditional Agricultures

Corn futures rose yesterday following heavy falls last week as traders readied for a closely-watched world supply and demand report from the U.S Department of Agriculture (USDA). Forecasts of hotter U.S weather also supported corn. Soybeans were firm and wheat was little changed.

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-U.S Recovery

The FOMC meeting minutes left a few wondering about the strength of the US recovery, but rates remain a focal point, with comments continuing that they may need to be raised sooner to help ward off a possible instability in the financial system. Tapering was another point mentioned, and it now looks to be a part of any rate rise plans. Despite this, the USD was far from confident with losses to the JPY and CHF for the week. The EUR shrugged off dollar demand with a mini jump after ECB comments around inflation and its inflation target. Inflation is not seen where they want to be, and the 2% rate has now become a target, not a ceiling. Despite this, comments said it was not the same as the US target approach?

Tapering, rates, and delta numbers looked to have driven a mini sell-off in stocks late last week. The DAX reacted severely to the ECB comments, and selling wasn’t European based. Asian indexes had a horror run on Thursday as the Nikkei, and Hang Seng fell sharply. Losses on the Nikkei short-lived as it bounced back with vigor on Friday. It wasn’t all doom and gloom, the Nasdaq and S&P500 both hit new all-time highs last week.

Gold saw a solid week, with demand coming back into the metal off the back of last week's worries. Price trading back up to the 1818 area. Oil saw a wild week of trade with a move back up to 77 before tumbling back down to 70. Price recovered late week but had to deal with a few influences from indecision from OPEC members, which is seen as resolving in the near future.

This week we have two central bank meetings, NBNZ and the BOC. Will there be any updates from the BOC after their solid jobs data? The focus will be on US CPI and retail sales under the current climate. Chinese GDP will be another focus after their last 18% gain. Friday’s recovery in equities, was the reaction overblown? Is the market starting to price in rate rates and tapering? Could we see the Nasdaq and S&P500 make new moves at breaking last week's records?

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 reached its sixth consecutive all-time closing high

The S&P 500 reached it's sixth consecutive all-time closing high yesterday, as a new quarter and the second half of the year began with upbeat economic data and a broad-based rally. Investors now eye today’s much-anticipated employment report. The bellwether index is enjoying its longest winning streak since early February, and the last time it logged six straight all-time highs was last August. The blue-chip Dow joined the S&P in positive territory, but a decline in tech shares - led by microchips - tempered the NASDAQ’s gain. The ongoing worker shortage attributed to federal emergency unemployment benefits, a childcare shortage, and lingering pandemic fears, was a common theme in the day’s economic data. Jobless claims continued their downward trajectory according to the Labor Department, touching their lowest level since the pandemic shutdown, and a report from Challenger, Gray & Christmas showed planned layoffs by U.S. firms were down 88% from last year, hitting a 21-year low.

Dow Jones Industrial Average

 The Dow Jones Industrial Average added 0.38%. The best performers of the session on the Dow Jones Industrial Average were Nike Inc., which rose 2.30% or 3.56 points to trade at 158.05 at the close. Meanwhile, The Travelers Companies Inc. added 1.41% or 2.11 points to end at 151.82 and Chevron Corp was up 1.38% or 1.45 points to 106.19 in late trade. The worst performers of the session were Walgreens Boots Alliance Inc., which fell 7.41% or 3.90 points to trade at 48.71 at the close. Goldman Sachs Group Inc. declined 1.22% or 4.62 points to end at 374.91 and Walmart Inc. was down 1.20% or 1.69 points to 139.33.

NASDAQ 100

 The NASDAQ index gained 0.13%. The top performers on the NASDAQ Composite were Alterity Therapeutics Ltd which rose 63.85% to 2.1300, Trxade Group Inc. which was up 61.76% to settle at 7.150 and Marin Software Inc. which gained 39.24% to close at 14.94. The worst performers were Citius Pharmaceuticals Inc. which was down 25.57% to 2.590 in late trade, Borqs Technologies Inc. which lost 23.45% to settle at 1.1100, and 1Stdibs.Com Inc. which was down 21.75% to 27.24 at the close.

Oil

Oil prices rose roughly 2% yesterday on indications that OPEC+ producers could increase output more slowly than expected in the coming months while rising global fuel demand causes supply to tighten. U.S. West Texas Intermediate crude settled at $75.23 a barrel, gaining $1.76, or 2.4%. Futures pared gains after the Organization of the Petroleum Exporting Countries and allies, known as OPEC+, delayed its ministerial meeting until Friday to hold more talks on oil output policy, sources said, after the United Arab Emirates blocked a plan for an immediate reduction in supply cuts. Such a delay in talks is unusual and would appear to indicate some significant discord within the organization between participants. OPEC+ sources said earlier that the group was expected to increase output by 0.4 million barrels per day a month from August to December 2021. There have been several outbreaks of the Delta variant of the coronavirus, raising concerns that the recovery will falter.

Precious and Base Metals

Gold edged up yesterday as a more than 7% slide in June prompted some traders to buy the metal amid concerns over the Delta variant of the coronavirus, but moves were capped by caution over today’s U.S payrolls data and a strong dollar. Spot gold was up 0.2% to $1,773.09 per ounce, while U.S gold futures settled up 0.3% at $1,776.80. Gold posted its biggest monthly loss since November 2016 in June, hurt by a surprise hawkish shift by the U.S Federal Reserve. Higher interest rates tend to translate into a higher opportunity cost of holding non-yielding gold. But some investors bought gold as a safe haven as the Delta variant of the coronavirus spread, analysts said, with France delaying the easing of restrictions in the Landes region. Focus is now on Friday’s nonfarm payrolls report for clues on the timeline of the U.S monetary policy shift after Federal Reserve officials suggested the central bank should ease asset purchases this year. A Reuters poll forecast a gain of 690,000 jobs this month. Initial jobless claims dropped more than expected last week. Gold prices are in a downtrend and the bears have the overall near-term technical advantage. For gold to turn a corner, you’re going to have seen multiple closes above $1,800. Gold’s advance was also kept in check by a firm dollar. Elsewhere, silver fell 0.5% to $25.98 per ounce, palladium dropped 0.5% to $2,764.66, and platinum rose 0.8% to $1,081.30. Copper came under pressure yesterday as weak manufacturing data from top consumer China and a stronger dollar undermined sentiment, though fund buying offered some price support. Factory activity in China expanded at a slower pace in June as supply chain woes and a resurgence of COVID-19 cases in the export province of Guangdong drove output growth to its lowest in 15 months.

Traditional Agricultures

Soybean and wheat futures fell yesterday while corn firmed slightly, with all three commodities closing well off their session peaks on a round of profit-taking after rallying to their highest since mid-June. Forecasts for improving crop weather in the U.S Midwest added pressure. Much like corn, soybeans are dealing with the profit-taking that followed the sharply higher session and the wetter western Corn Belt forecast.

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-The U.S dollar hit a fresh three-month high

The U.S dollar hit a fresh three-month high versus other major currencies today, as traders wagered strong U.S labor data could lift it even further. The dollar index is on track for a further weekly gain - it's fourth in five weeks - of nearly 1%. It gained 0.1% on the day, hitting 92.699. The greenback has strengthened broadly since the U.S. Federal Reserve surprised markets last month by signaling it could tighten policy earlier than expected to curb inflation. The U.S. jobs report is due later today and is forecast to show a solid rise of 700,000, with traders braced for any surprises. The FX markets have certainly become more sensitive to incoming US economic data. That suggests to us that positioning in FX could still be short US dollars which are resulting in this further extension of dollar strength. A higher number in the employment report could fuel concerns of tighter Fed policy. The dollar has started July strongly; a U.S non-farm payrolls meet or beat today would maintain that momentum. Many people are now arguing over whether the dollar has indeed bottomed because at some point in 2023 the Fed is suggesting that it could be raising interest rates. Also, there's some nervousness about whether the dollar's going to start to behave in a more pro-cyclical manner, that is if the data is stronger than expected in the U.S. that the dollar really gets more strength from that. Euro edged lower with investors on hold ahead of U.S jobs data which might affect the Federal Reserve’s narrative about the economy and its monetary policy stance. More dovish signals came from the European Central Bank (ECB) with President Christine Lagarde saying the euro zone’s economy is beginning to rebound from a pandemic-induced slump but this recovery remains fragile. Meanwhile, concerns about the impact on the global economy of a possible monetary tightening in China and of the Delta variant are expected to keep risk sentiment on hold. Sterling fell yesterday after Bank of England Governor Andrew Bailey warned against over-reaction to rising inflation in Britain. Bailey said in his annual Mansion House speech that it was important to ensure that the recovery was not undermined by a premature tightening in monetary conditions, as a rise in inflation was likely to be temporary.

Euro

The single currency edged lower today with investors on hold ahead of U.S jobs data which might affect the Federal Reserve’s narrative about the economy and its monetary policy stance. More dovish signals came from the ECB President saying the euro zone’s economy is beginning to rebound from a pandemic-induced slump but this recovery remains fragile. 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 trading within narrow ranges as investors looked to U.S nonfarm payrolls reports for clues on whether the Federal Reserve will start to reduce monetary stimulus sooner rather than later. Increased vaccinations that have led to more robust economic activity have helped the U.S recovery from the pandemic. 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 fell after BoE Governor Andrew Bailey warned against over-reaction to rising inflation in Britain. Sterling was one of the worst-performing G-10 currencies last week after the BoE kept the size of its stimulus program unchanged and said inflation would surpass 3%, but that the climb further above its 2% target would be only temporary. 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 may strengthen over the coming year, bolstered by higher oil prices and reduced stimulus from the Bank of Canada, but gains could stop short of the currency's recent six-year high, a Reuters poll showed. Canada is a major exporter of commodities, including oil, so the loonie is particularly sensitive to the global economic outlook. 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 traded slightly weaker in a subdued session today, as investors remained on edge ahead of the much-anticipated U.S employment report due later in the day. Data showed that Australian banks’ lending to investors for homes spiked 13.3% in May, a metric that analysts said was a portent of policy tightening by regulators amid sky-rocketing house prices. Overall, AUD/USD traded with a low of 0.7458 and a high of 0.7505 before closing the day at 0.7468 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 45 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 46 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 40 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 50 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 49 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

Wall Street was muted yesterday and the S&P teased its fifth straight record closing high as investors ended the month and the quarter by largely shrugging off positive economic data and looking toward Friday’s highly anticipated employment report. The indexes were languid and range-bound, with the blue-chip Dow posting modest gains, while the S&P 500 and the NASDAQ stayed relatively close to the starting gate. The news is sanguine and therefore we’re not seeing big swings. For the month, the bellwether S&P 500 was set to notch its fifth consecutive advance, while the Dow was on track to snap its four-month winning streak. The NASDAQ was on course for a green June. This month, investor appetite shifted away from economically sensitive cyclical in favor of growth stocks. All three indexes were on pace for their fifth consecutive quarterly gains, and the S&P 500 is on track to register its second-best first-half performance since 1998, rising 14.3%.

Dow Jones Industrial Average

The Dow Jones Industrial Average rose 0.61%. The best performers of the session on the Dow Jones Industrial Average were Walmart Inc., which rose 2.72% or 3.73 points to trade at 141.03 at the close. Meanwhile, Goldman Sachs Group Inc. added 1.84% or 6.84 points to end at 379.46 and Boeing Co was up 1.61% or 3.80 points to 239.56 in late trade. The worst performers of the session were Intel Corporation, which fell 1.09% or 0.62 points to trade at 56.13 at the close. Nike Inc. declined 0.93% or 1.45 points to end at 154.50 and Visa Inc. Class A was down 0.80% or 1.88 points to 234.07.

NASDAQ 100

 The NASDAQ index fell 0.17%. The top performers on the NASDAQ Composite were Cuentas Inc. which rose 120.86% to 6.140, Newegg Commerce Inc. which was up 77.64% to settle at 19.31, and Borqs Technologies Inc. which gained 43.70% to close at 1.4300. The worst performers were BSQUARE Corporation which was down 40.98% to 4.745 in late trade, Altimmune Inc. which lost 37.92% to settle at 9.87, and Marin Software Inc. which was down 37.69% to 10.78 at the close.

Oil

Oil prices rose today, supported by lower U.S inventories and the prospect of strengthening demand, while investors awaited a decision from OPEC+ producers on whether they would maintain or reduce supply cuts in the second half of the year. U.S West Texas Intermediate crude was up 88 cents, or 1.2%, at $74.35. WTI rose more than 10% in June while Brent added more than 8%, touching their highest levels since October 2018. Analysts expect oil demand to gather pace in the second half of the year as more people are vaccinated against COVID-19 and travel restrictions are eased. The OPEC+ group of oil producers meets today to decide on a further easing of output cuts next month and could also consider extending its overall supply pact beyond April 2022, sources within the group told Reuters. Sideline discussions indicate that Russia is proposing to boost supply while Saudi Arabia wants a more cautious approach. In the United States, crude stockpiles fell last week for the sixth straight week.

Precious and Base Metals

Gold prices rose today as concerns over the more infectious Delta variant of COVID-19 bolstered its safe-haven appeal, ahead of U.S jobs data seen as crucial to the Federal Reserve’s policy outlook. Spot gold gained 0.4% to $1,776.40 per ounce and U.S gold futures climbed 0.4% to $1,776.50. While the market is concerned about rate hikes going into the non-farm payrolls data, the spread of the Delta variant globally is supporting gold prices. Rising cases of the Delta variant have prompted France to delay the easing of restrictions in the Landes region, while infections have also surged in Asia. Investors are now awaiting the U.S. non-farm payrolls (NFP) report due on Friday for clues on the Fed’s next step. The Fed is keen on signs of continued strength in the jobs market as a guide to tapering. The ADP data was better than expected and if that feeds into the NFP data this week, then gold may weaken again as the case for ‘tapering’ is stronger. Gold has held well at current levels but has yet to break out of the ongoing consolidation. Federal Reserve Bank of Dallas President Robert Kaplan said on Wednesday he would like the Fed to start reducing its support for the economy before the end of the year, in part to make an abrupt policy tightening less likely later on. A Fed rate hike will increase the opportunity cost of holding bullion, dulling its appeal. Silver rose 0.4% to $26.22 per ounce, palladium fell 1% to $2,751.5 and platinum gained 0.1% to $1,073.5. Copper yesterday was on track for its biggest monthly fall since March 2020 as a stronger dollar, the threat of tighter U.S monetary policy and moves by China to keep a lid on prices pulled the metal from record highs. Many analysts say rising demand for copper in infrastructure and electrification will cause shortages and higher prices in the coming years.

Traditional Agricultures

Soybean futures surged yesterday after the U.S Department of Agriculture surprised traders with lower-than-expected plantings estimates and inventory data. Corn climbed by their daily exchange-imposed limit after USDA pegged plantings of the crop at 92.692 million acres, below analysts’ expectations for 93.787 million. There is simply no margin of error for bad weather, and we do have bad weather.

Wall Street was muted yesterday and the S&P teased its fifth straight record closing high as investors ended the month and the quarter by largely shrugging off positive economic data and looking toward Friday’s highly anticipated employment report. The indexes were languid and range-bound, with the blue-chip Dow posting modest gains, while the S&P 500 and the NASDAQ stayed relatively close to the starting gate. The news is sanguine and therefore we’re not seeing big swings. For the month, the bellwether S&P 500 was set to notch its fifth consecutive advance, while the Dow was on track to snap its four-month winning streak. The NASDAQ was on course for a green June. This month, investor appetite shifted away from economically sensitive cyclicals in favor of growth stocks. All three indexes were on pace for their fifth consecutive quarterly gains, and the S&P 500 is on track to register its second-best first-half performance since 1998, rising 14.3%.

Dow Jones Industrial Average

 The Dow Jones Industrial Average rose 0.61%. The best performers of the session on the Dow Jones Industrial Average were Walmart Inc., which rose 2.72% or 3.73 points to trade at 141.03 at the close. Meanwhile, Goldman Sachs Group Inc. added 1.84% or 6.84 points to end at 379.46 and Boeing Co was up 1.61% or 3.80 points to 239.56 in late trade. The worst performers of the session were Intel Corporation, which fell 1.09% or 0.62 points to trade at 56.13 at the close. Nike Inc. declined 0.93% or 1.45 points to end at 154.50 and Visa Inc. Class A was down 0.80% or 1.88 points to 234.07.

NASDAQ 100

The NASDAQ index fell 0.17%. The top performers on the NASDAQ Composite were Cuentas Inc. which rose 120.86% to 6.140, Newegg Commerce Inc. which was up 77.64% to settle at 19.31 and Borqs Technologies Inc. which gained 43.70% to close at 1.4300. The worst performers were BSQUARE Corporation which was down 40.98% to 4.745 in late trade, Altimmune Inc. which lost 37.92% to settle at 9.87 and Marin Software Inc. which was down 37.69% to 10.78 at the close.

Oil

Oil prices rose today, supported by lower U.S inventories and the prospect of strengthening demand, while investors awaited a decision from OPEC+ producers on whether they would maintain or reduce supply cuts in the second half of the year. U.S West Texas Intermediate crude was up 88 cents, or 1.2%, at $74.35. WTI rose more than 10% in June while Brent added more than 8%, touching their highest levels since October 2018. Analysts expect oil demand to gather pace in the second half of the year as more people are vaccinated against COVID-19 and travel restrictions are eased. The OPEC+ group of oil producers meets today to decide on a further easing of output cuts next month and could also consider extending its overall supply pact beyond April 2022, sources within the group told Reuters. Sideline discussions indicate that Russia is proposing to boost supply while Saudi Arabia wants a more cautious approach. In the United States, crude stockpiles fell last week for the sixth straight week.

Precious and Base Metals

Gold prices rose today as concerns over the more infectious Delta variant of COVID-19 bolstered its safe-haven appeal, ahead of U.S jobs data seen as crucial to the Federal Reserve’s policy outlook. Spot gold gained 0.4% to $1,776.40 per ounce and U.S gold futures climbed 0.4% to $1,776.50. While the market is concerned about rate hikes going into the non-farm payrolls data, the spread of the Delta variant globally is supporting gold prices. Rising cases of the Delta variant have prompted France to delay the easing of restrictions in the Landes region, while infections have also surged in Asia. Investors are now awaiting the U.S. non-farm payrolls (NFP) report due on Friday for clues on the Fed’s next step. The Fed is keen on signs of continued strength in the jobs market as a guide to tapering. The ADP data was better than expected and if that feeds into the NFP data this week, then gold may weaken again as the case for ‘tapering’ is stronger. Gold has held well at current levels but has yet to break out of the ongoing consolidation. Federal Reserve Bank of Dallas President Robert Kaplan said on Wednesday he would like the Fed to start reducing its support for the economy before the end of the year, in part to make an abrupt policy tightening less likely later on. A Fed rate hike will increase the opportunity cost of holding bullion, dulling its appeal. Silver rose 0.4% to $26.22 per ounce, palladium fell 1% to $2,751.5 and platinum gained 0.1% to $1,073.5. Copper yesterday was on track for its biggest monthly fall since March 2020 as a stronger dollar, the threat of tighter U.S monetary policy and moves by China to keep a lid on prices pulled the metal from record highs. Many analysts say rising demand for copper in infrastructure and electrification will cause shortages and higher prices in the coming years.

Traditional Agricultures

Soybean futures surged yesterday after the U.S Department of Agriculture surprised traders with lower-than-expected plantings estimates and inventory data. Corn climbed by their daily exchange-imposed limit after USDA pegged plantings of the crop at 92.692 million acres, below analysts’ expectations for 93.787 million. There is simply no margin of error for bad weather, and we do have bad weather.

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.

Market Update: GER30 Remains Hemmed at Resistance

Today we’re looking at the daily GER30 as buyers continue to stall from key resistance. This level remains a key obstacle for the current uptrend.

Key resistance has continued to develop from 15,755 on the GER30 and overnight we saw the latest failed attempt from buyers to beat the level after sellers faded the move once price entered. For, now, there looks to be plenty of fresh supply waiting for buyer moves.  Buyers look to be continuing to grind the current trend higher but until we see a break consolidation could continue as price tries to work out who holds control. Adding to the picture is an ascending triangle pattern that remains in play. These patterns in uptrends are normally seen as bullish continuation patterns but breakout confirmation is required to give the trader direction bias.

Today’s session will be a focus for us, will we see price continue to consolidate? A break higher that can close above resistance suggests buyers hold momentum and that we could see the overall uptrend continue. A break lower out of the current ascending triangle pattern could be a warning that sellers could be looking to test out buyer confidence.

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.