It is all about central bank decisions this week with three major banks on the calendar including the FOMC, ECB, and BoJ, with the markets positioning ahead of these releases. Trading was quiet heading into the weekend while Treasuries have gone through several gyrations in recent weeks amid on-again, off-again expectations regarding the future policy path. Dollar steadied at 100.73 as bearish US Dollar bets prevail. Today, stock markets traded mixed and Japan bourses rallied, as comments and reports suggest the bank sees little need to tweak policy or address the side effects of YCC.
Sunday: Spain was plunged into political uncertainty on Sunday night as both the right and left failed to secure a clear path to forming a government, even though the opposition People’s Party won the most seats in parliament.
- FX – The USDIndex firmer at 100.73. USDJPY at Friday’s highs at 141.55 as gains against JPY were pronounced after indications from BoJ Ueda that the Bank is not looking to tweak YCC any time soon. GBP hovering around 20-DMA, at 1.2870, while EUR holds above 1.11 for now.
- Stocks – The JPN225 closed up 1.23% at 32,700.7 amid the automakers rally including Mitsubishi (+5.55%). GER40 and UK100 are down -0.4% and US futures are narrowly mixed, with the US100 outperforming slightly. Hong Kong’s Hang Seng index was a bit of an outlier on the downside with a drop of 1.5%, dragged lower by Chinese property developers which tumbled more than 5%. #Nvidia -2.66%, #META -2.73%, Chevron +1.46% (strong oil earnings) & #Tesla -1.10%.
- Commodities – USOil remains supported as supply restrictions start to bite, at $76.60.
- Gold – failed to break 20-DMA and currently settled at $1962.80.
Today – It is all about PMIs, while the key events of the week are the data on Consumer Confidence, Q2 GDP and US inflation. Microsoft, GM, Verizon, Alphabet, Exxon Mobil, Meta and more stocks to watch this week.
Biggest Mover @ (06:30 GMT) EURUSD (-0.54%) return below 1.1100 post German manufacturing PMI.
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Andria Pichidi
Market Analyst
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