America’s Roundup: Dollar eases as traders scale back bets on Fed tightening, Wall Street ends higher, Gold slips, Oil rises to 2-month high on tight supplies, EU seeks Russian crude ban-May 27th,2022

Posted at 27 May 2022 / Categories Market Roundups

Market Roundup

•US Continuing Jobless Claims 1,346K,1,310K forecast, 1,317K previous

•US Jobless Claims 4-Week Avg   206.75K,199.50K previous

•US Initial Jobless Claims210K, 215K forecast,  218K previous

• Canada Mar Core Retail Sales (MoM)  2.4%,2.0% forecast,  2.1% previous

•Canada Mar Retail Sales (MoM) 0.0%,1.4% forecast,  0.1% previous

•US Mar GDP Price Index (QoQ) (Q1) 8.1% ,8.0% forecast, 8.0% previous

•US Core PCE Prices (Q1) 5.10% ,5.20% forecast,5.20% previous

•US GDP (QoQ) (Q1) -1.5% ,-1.3% forecast,-1.4% previous

•US Apr Pending Home Sales Index 99.3  ,103.7 previous

•US Apr Pending Home Sales (MoM) -3.9% ,-2.0% forecast,-1.2% previous

•US Natural Gas Storage 80B ,89B forecast,-89B previous

•US May KC Fed Manufacturing Index 19 ,28 previous

•US May KC Fed Composite Index 23 ,25 previous

Looking Ahead - Economic Data (GMT)

•No data ahead

Looking Ahead - Economic events and other releases (GMT)

•No events ahead

Currency Summaries

EUR/USD: The euro strengthened on Thursday as European Central Bank (ECB) policymakers soothed fears of more aggressive rate tightening than expected, starting from a 50-basis-point interest rate increase in July. ECB chief Christine Lagarde gained key allies for her tightening plan on Wednesday, but Klaas Knot, one of the most conservative governing council members, argued right away that the central bank should not yet rule out a 50-basis-point interest rate increase in July.Lagarde has advocated a gradual approach to monetary tightening while asserting the ECB is free to react to the effects on the economy and the inflation outlook as rates rise. Immediate resistance can be seen at 1.0756(38.2%fib), an upside break can trigger rise towards 1.0784 (Higher BB).On the downside, immediate support is seen at 1.0649(23.6%fib), a break below could take the pair towards 1.0605 (9DMA).

GBP/USD: Sterling held near its highest levels in three weeks on Thursday, with traders awaiting more details on the British government’s response to a cost-of-living crisis.Sterling has been hit hard in recent weeks by growing fears that Britain’s economy is heading towards recession and analysts said any signs of government support could help lift sentiment toward the currency, which has rebounded this week.The pound was broadly steady at $1.2594, having briefly touched a three-week peak at $1.2612. It was also little changed versus the euro at 84.96 pence.Immediate resistance can be seen at 1.2603(38.2%fib),an upside break can trigger rise towards 1.2702(50%fib).On the downside, immediate support is seen at 1.2559(5DMA), a break below could take the pair towards 1.2493 (23.6%fib).

USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Thursday as a jump in oil prices and improvement in risk appetite offset domestic data showing that retail sales growth stalled in March. Wall Street surged as a raft of solid retail earnings and soft economic data eased lingering concerns that the Federal Reserve's aggressive policy tightening would extend beyond expectations.Canadian retail sales were unchanged in March from February, missing estimates for a 1.4% advance, as lower sales at motor vehicle and parts dealers offset gains in all other subsectors. A preliminary estimate showed that sales grew 0.8% in April. Immediate resistance can be seen at 1.2791(5DMA), an upside break can trigger rise towards 1.2824 (38.2%fib).On the downside, immediate support is seen at 1.2736 (50%fib), a break below could take the pair towards 1.2694(Lower BB).

USD/JPY: The dollar edged lower against the Japanese yen on Thursday as markets considered whether the Federal Reserve might slow or even pause its tightening cycle in the second half of the year, which would weaken the allure of the dollar. Dollar began to weaken after minutes from the Fed's May meeting, released Wednesday, showed that most participants judged that 50 basis-point hikes would likely be appropriate at the June and July policy meetings to combat inflation that they agreed had become a key threat to the economy's performance. The dollar edged down 0.011% against the Japanese yen to 127.155 yen. Strong resistance can be seen at 127.38(5DMA), an upside break can trigger rise towards 128.47(23.6%fibOn the downside, immediate support is seen at 126.33 (50DMA), a break below could take the pair towards 125.00(Psychological level).

Equities Recap

European markets rose on Thursday with the retail sector leading the charge as Britain revealed new stimulus plans, while the U.S. Federal Reserve sticking to its monetary policy tightening script also bolstered risk appetite.

UK's benchmark FTSE 100 closed up by 0.56 percent, Germany's Dax ended up by 1.59 percent, France’s CAC finished the day up by1.78 percent.

Wall Street closed sharply higher on Thursday after optimistic retail earnings outlooks and waning concerns about overly aggressive interest rate hikes by the Federal Reserve put investors in a buying mood.

Dow Jones closed up by  1.61% percent, S&P 500 closed down by 1.99% percent, Nasdaq settled up by 2.68%  percent.

Treasuries Recap

U.S. Treasury yields were little changed on Thursday after the benchmark 10-year note hit a fresh six-week low, with inflation fears continuing to dissipate as economic data and corporate announcements point to slower growth.

The yield on 10-year Treasury notes  rose 0.9 basis points to 2.756% after falling to 2.706% early in the session.

Commodities Recap

Gold prices slipped on Thursday as the U.S. Federal Reserve's aggressive monetary policy tightening plan dimmed the metal's appeal, with additional pressure from a rebound in equities.

Spot gold fell 0.18% to $1,849.52 per ounce by 2:12 p.m. ET (1812 GMT). U.S. gold futures settled up 0.07% at $1,847.6.

Oil prices climbed about 3% to a two-month high on Thursday on signs of tight supply ahead of U.S. summer driving season, as the European Union (EU) wrangled with Hungary over plans to ban crude imports from Russia over its invasion of Ukraine.

Brent futures rose $3.37, or 3.0%, to settle at $117.40 a barrel, while U.S. West Texas Intermediate (WTI) crude rose $3.76, or 3.4%, to settle at $114.09.

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