USD remained steady (USDIndex 102.10) Stocks recover a tad from Friday’s post NFP sell off (NASDAQ -2.47%) and Yields also hold onto gains (2.957%). Asian markets mixed in thin trading today (AUD & NZD closed along with many EZ countries). Central bank outlooks, China’s virus lockdowns and inflation data remain in focus – NFP showed a tight jobs market and Earnings holding up, so FED may need to act again in September, Saudi Arabia has increased oil prices & US will allow two companies to import Venezuelan oil into Europe. Musk predicted a gloomy US economy (following Dimon’s comments) and suggested TESLA needed to shrink its workforce by 10% (only to then withdraw the comment), US to pause, for 24mths, tariffs on Solar Panel imports, Kuroda “Japan will not tighten monetary policy”.
- USDIndex rallied to 102.25, back to 102.00 now.
- Equities – USA500 -68 (–1.63%) at 4108, US500FUTS at 4131 now. Worries about a more aggressive FEd during the Autumn weighed on stocks.
- Yields 10-year yield higher (2.957% at close), trades at 2.950% now.
- Oil & Gold had mixed sessions – USOil rallied to $120.86 following Saudi news before slipping under $120, Gold sank from over $1874 on Friday to $1852 now.
- Bitcoin rallied from under $30K on Friday to trade at $31.2K now.
- FX markets – EURUSD under 1.0725 again, USDJPY tested 131.00 brand holds 130.50, Cable trades over 1.2500, a no confidence vote in PM Johnson will take place later today by his own elected MPs.
Overnight – CNY Caixin Services PMI missed significantly 41.4 vs. 46.1.
Today – a light calendar with Holiday Closures in many parts of Europe and no econ. news scheduled for NA session. All eyes on RBA, ECB & US CPI data later this week.
Biggest FX Mover @ (06:30 GMT) GBPAUD (-0.44%). Rallies from sub 1.7300 on Friday to 1.7400 today following Johnson news. MAs aligning higher, MACD histogram positive & breaks 0 line, RSI 65 & rising, H1 ATR 0.0024, Daily ATR 0.0050.
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Stuart Cowell
Head Market Analyst
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