News

America's Roundup: Dollar dips modestly as trade, data in focus,U.S. stocks ended near flat, Gold dips slightly on profit taking, Oil steadies as demand concerns counter OPEC cuts-June 12th,2019

Market Roundup

• Mexico reveals border infrastructure plan; Trump vows migration deal details

• Trump defends tariff strategy as China says it's 'not afraid of a trade war'

• US May PPI Final Demand YY, 1.8%, 2.0% forecast, 2.2% previous

• US May PPI Final Demand MM, 0.1%, 0.1% forecast, 0.2% previous

• US May NFIB Business Optmisism Idx, 105.00, 103.50 previous 

• US May PPI exFood/Energy YY, 2.3%, 2.3% forecast, 2.4% previous

• US w/e Redbook YY, 5.0%, 5.8% previous

• US w/e Redbook MM, -2.6%, 1.4% previous

• Gold drops on profit booking, U.S.-China trade optimism

• Mexico central bank chief flags concern over ratings setbacks

Looking Ahead – Economic Data (GMT)

• 11 Jun 04:15 New Zealand Elec Card Retail Sale YY, 4.5% previous

• 12 Jun 00:30 Australia Jun Consumer Sentiment, 0.6% previous

Looking Ahead – Events, Other Releases (GMT)

• 08:15 ECB's Mario Draghi speaks in Frankfurt

• 09:00 ECB Board member Luis de Guindos speaks in Frankfurt

• 12:15 ECB Board member Benoit Coeure speaks in Frankfurt

Currency summaries

EUR/USD: The euro strengthened against the U.S. dollar on Tuesday, as investors focused on the U.S.-China trade war and economic data for signals of growth and whether the U.S. Federal Reserve is likely to cut rates in the coming months.Risk sentiment improved on Monday, after the United States reached a deal with Mexico on Friday to avoid imposing tariffs on the country.Ongoing tensions between the U.S. and China and the prospect that U.S. President Donald Trump will look to impose tariffs on Japan and Europe, however, continues to weigh on risk sentiment.Investors are concerned that trade wars are harming global growth, and increasing the likelihood that the U.S. central bank will need to cut rates to stimulate growth.The euro was up 0.01 percent at $1.1326. Immediate resistance can be seen at 1.1390 (38.2% retracement level), an upside break can trigger rise towards 1.1443 (Dec 10th high).On the downside, immediate support is seen at 1.1293 (5 DMA), a break below could take the pair towards 1.1250  (9 DMA).

GBP/USD:Sterling pulled back from five-month lows against dollar on Tuesday, after British wages in the three months to April rose faster than expected.The pound has been on the backfoot in recent weeks as investors sit on the sidelines while the contest to succeed Theresa May as leader of the Conservative party and country heats up.  Worse than expected data on Monday showing the British economy shrank 0.4% in April added to the pound's worries. But sterling found relief after wage growth in the three months to April came in at 3.1%, exceeding a forecast by a poll of economists for 3%. Employment growth slowed but the jobless rate held at its lowest since 1975, the official figures showed. The pound recovered against the dollar to $1.2728 from around $1.2694 before the data. Immediate resistance can be seen at 1.2690 (10 DMA), an upside break can trigger rise towards 1.2882 (50 DMA).On the downside, immediate support is seen at 1.2682 (9 DMA), a break below could take the pair towards 1.2562 (May 31st low).

USD/CAD:The Canadian dollar weakened against its U.S. counterpart on Tuesday, with the currency extending its pullback from a three-month high the day before, as a rally driven by more dovish expectations for the Federal Reserve lost some momentum. More gains for the Canadian dollar could come if the Fed were to signal at next week's interest rate announcement that it is going to ease in July and if oil prices start to recover, Anderson said. Money markets see a greater than 80% chance that the Fed will cut interest rates as soon as next month and are also expecting at least one further cut before the end of the year.At   (2213 GMT), the Canadian dollar   was last  trading 0.1% lower at 1.3284 to the greenback, or 75.28 U.S. cents. The currency, which on Monday touched its strongest intraday level since March 1 at 1.3226, traded in a range of 1.3251 to 1.3309.. Immediate resistance can be seen at 1.3293 (5 DMA), an upside break can trigger rise towards 1.3358 (9 DMA).On the downside, immediate support is seen at 1.3200 (Psychological level), a break below could take the pair towards 1.3149 (20th Feb Low).

USD/JPY: The dollar edged higher against the Japanese yen on Tuesday, as investors' risk appetite ticked up after the United States shelved plans to impose tariffs on Mexico, though fresh U.S. trade threats against China tempered overall market sentiment. Financial markets over the last year have been gripped by fears of escalating trade tensions between the world's two largest economies, stoking worries over the outlook for global growth. Against the safe-haven yen, the dollar advanced nearly 0.2% to 108.625 yen JPY=, extending a similar gain during the previous session. The dollar index, which measures the greenback against a basket of six peers, edged up 0.05% to 96.799  , building on a 0.2% gain achieved overnight. Strong resistance can be seen at 108.54(11 DMA), an upside break can trigger rise towards 109.15 (21 DMA).On the downside, immediate support is seen at 107.78 (Lower Bollinger Band), a break below could take the pair towards 107.00(Psychological level). 

Equities Recap

European stocks finished higher for a third day on Tuesday, as German shares caught up with a global stock rally after a holiday on easing trade tensions, while fresh stimulus for China's slowing economy boosted the basic resources sector.

UK's benchmark FTSE 100 closed up by 0.30 percent, the pan-European FTSEurofirst 300 ended the day up by 0.70 percent, Germany's Dax ended up by 1.02 percent, France’s CAC finished the day up by 0.54 percent.

U.S. stocks ended near flat and the Dow snapped a six-day winning streak on Tuesday, as investors paused following a run of gains and fresh worries emerged over the U.S. trade war with China.

Dow Jones closed down by 0.05 percent, S&P 500 ended down 0.03 percent, Nasdaq finished the day down by 0.00 percent.

Treasuries Recap

An uptick in U.S. inflation and strong results from a $38 billion Treasury auction on Tuesday drove short-dated yields higher, flattening the yield curve.

The three-year yield   was last 0.8 basis point higher at 1.882%. At the long end, the 10-year yield   was 0.4 basis point higher at 2.145% and the 30-year yield  0.1 basis point lower at 2.620%.

Commodities Recap

Gold prices dipped slightly on Tuesday as investors booked profits following robust gains over the past weeks, while rising hopes of a trade deal between China and the United States lifted equities.

Spot gold   dipped slightly to $1,327.41 per ounce as of 1:33 p.m. EDT (1733 GMT). Prices had hit a 14-month high of $1,348.08 on June 7.U.S. gold futures   settled 0.1% higher at $1,328.50 per ounce.

Oil prices were steady on Tuesday, weighed by concerns about a global economic slowdown that could dent crude demand, but supported by expectations that OPEC and its allies will extend their supply curbs.

Brent crude futures settled unchanged at $62.29 a barrel, while U.S. West Texas Intermediate (WTI) crude futures edged up 1 cent to end at $53.27 a barrel.


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