Market Update – June 1st -Stocks higher after bill vote

Yesterday’s dovish Fedspeak, a mixed Beige Book, a weak Chicago PMI, and easing concerns over a default supported yields. Month-end demand and a little risk aversion underpinned too. The market also continued to correct from some of the heavy losses since May 11 resulting from hotter data that opened the door for a June rate hike. Implied Fed funds futures dive and Treasury yields have followed suit after Fed Governor Jefferson touted skipping a June hike in order to see more data. The June implied rate has fallen to 5.198% and July has downshifted to 5.288%.

Today, Stocks edged higher after the House voted 314-117 on Wednesday in favour of a bill to raise the US debt ceiling. The bill will pass through the Senate next. German retail sales rose 0.8% m/m in April & UK house prices fell 0.1% in May as rate concerns persist.

  • FX USDIndex climbed to 104.699 with support from JOLTS, but closed lower at 104.23 following dovish Fedspeak and the Beige Book. EUR dipped to 1.0683, JPY pulled back to 139.30 and Cable fell 0.2% to 1.239
  • Stocks – US100 was down -0.63% and the US500 off -0.61%, unwinding some of the enthusiasm from Nvidia. The US30 slid -0.41%.

  • Commodities – USOil remained under pressure below $69 after weaker than expected official PMI reports for China added to growth concerns and weighed on the demand outlook. Comments from Russian officials damped speculation that OPEC+ could announce deeper output cuts at the June 4 meeting. 
  • Gold – moved sideways between $1960-$1968. It closed the month lower after strong data releases bolstered speculation of another Fed hike in June.
  • Cryptocurrencies BTC closed the week’s gap down to $26,580.

Today UK Manufacturing PMI, Eurozone Inflation and Core, US ADP change and ISM Manufacturing Index.

Biggest FX Mover @ (06:30 GMT) Cotton (+2.58%) spiked to 85.42. MAs aligned higher, MACD histogram & signal line turned positive but still close to 0, RSI 69 & rising.

Click here to access our Economic Calendar

Andria Pichidi

Market Analyst

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.