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Nasdaq 100 falters as Canada’s rate hike focusses attention on next week’s US decision
The market-leading Nasdaq 100 fell as Treasury yields push higher ahead of next week's meeting of the Federal Open Market Committee. Canada’s central bank unexpectedly raised interest rates by 25 basis points, adding to market apprehension on what might come for US rates. Fed Fund futures trading puts just 36% odds of a rate hike on next week's meeting, up from 22% odds yesterday, leading to some profit taking in tech stocks.e Nasdaq 100 fell on profit-taking in tech stocks as Treasury yields push higher ahead of next week's meeting of the Federal Open Market Committee. Canada’s central bank unexpectedly raised interest rates by 25 basis points, adding to market apprehension on what might come for US rates. Fed Fund futures trading puts just 36% odds of a rate hike on next week's meeting, up from 22% odds yesterday, leading to some profit taking in tech stocks.
Crypto rallies despite SEC actions
Stocks were mixed at midday as traders battle the current malaise ahead of next week's Federal Reserve meeting. The VIX, Wall Street’s fear index, moved to new lows suggesting no great concerns. Coinbase, the listed crypto exchange, was sued by the SEC and ten state regulators, a day after competitor Binance faced its ire. Bitcoin and other crypto tokens rallied. China’s economic recovery saw more bad news, but the World Bank remained upbeat on global growth.
Oil rallies, Bitcoin slumps
Oil prices rallied after news that OPEC+, led by Saudi Arabia, will reduce oil output. Equity, bond and currency markets were largely unchanged as traders look ahead to next week’s Federal Reserve meeting and the outlook for interest rates. Economic data indicated economic growth, but a slower pace. US/China tensions continue to rise over Taiwan and remain an uncertain wild card for markets. Crypto stocks were slammed as the SEC sued exchange operator Binance.
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US Dollar Technical Forecast: Into the FOMC Blackout We Go
The US Dollar tangled with a trendline for most of the week until sellers made a push on Thursday, with bulls forcing a comeback on Friday after the NFP report.
Russell 2000 leads markets higher, despite another strong jobs report
Smaller and more cyclical stocks in the Russell 2000 index led a buoyant stock market following passage of the debt ceiling bill, sending the measure to President Biden for his signature. Much stronger than expected payroll numbers failed to dampen enthusiasm. Small cap stocks led the rally, taking up leadership from tech stocks. Gold fell back and oil rallied.
EUR/USD, AUD/USD and USD/CAD forecast – Forex Friday
In this week’s edition, we discuss the EUR/USD, AUD/USD and USD/CAD forecast and look forward to the macro events in the week ahead.
Euro Price Outlook: EUR/USD Snaps Back Ahead of NFP
EUR/USD fell hard and fast, but a reversal starting on the final day of May has so far held through June. Can EUR/USD bulls make this into anything more than a pullback?
US Dollar Technical Forecast: USD Bulls Exhaust into Resistance
US Dollar is poised snap a three-week winning streak as DXY responds to technical resistance- risk for exhaustion. The levels that matter on the weekly technical chart.
Gold rallies and equities fall on stronger jobs data, rate hike risks rise
Stocks remained under pressure today ahead of an expected House of Representatives vote on the debt ceiling deal this evening that would then send the bill to the Senate. Any hint of a slip in approving the deal would spook financial markets. Domestic jobs market data was surprisingly strong, suggesting the next move in interest rates will be up. There was more disappointing economic data out of China, hitting the energy, metals and agricultural commodity markets.
Nasdaq 100 doesn’t wait to ask ‘are we there yet?’
Aside from a continuing surge in AI stocks boosting the Nadaq 100, stocks were generally mixed this morning as work on the Hill turned to turning the debt ceiling deal into a final agreement in both houses on Congress. Don’t crack the champagne just yet – the deal isn’t sealed yet. Crude oil prices were down by more than 4% on the growth outlook if the US defaults, and skepticism about further supply cuts this week's OPEC+ meeting.
Nasdaq 100 set to extend 2023 rally?
US equities are poised to continue the past 2-month rally after today’s Memorial day holiday, with the Nasdaq 100 likely to benefit most. Of major markets open today, the Nikkei 225 was up over 1% (clocking a 20% rise for the year.) US stock futures rose modestly. The VIX, Wall Street’s fear index, fell to 17 this morning, on debt ceiling news.
US Dollar Technical Analysis: USD Turn Gathers Steam
The US Dollar is working on its third weekly gain, and it’s been a strong week, with gains Monday through Thursday until a trendline came into play to mark the highs. Can USD bulls continue to drive?
Nasdaq 100 heads to 12 month high as debt ceiling deal looks close
Nasdaq 100 lead equity markets higher even as bond markets dipped. Markets reacted positively to the belief that a deal on the debt ceiling is close (surprise surprise), but better than expected economic data led to higher expectations for rates (something not expected a few months ago.) The US dollar held on to recent gains, gold was unchanged, and oil bounced back after recent profit taking.
Bearish Base Metals Bottoming Out?
The macro, micro and technical outlook for base metals has been pretty bearish, and it is not surprising that the base metals price index has fallen to six months lows. Market sentiment towards the outlook for a rebound in economic growth within China weakened this year with the release of disappointing economic data.
Nasdaq 100 rebounds even as US debt is put on negative watch
The Nasdaq 100 rebounded this morning as traders become more optimistic on an agreement to raise the US debt ceiling, while Fitch became the first rating agency in this cycle to put US debt on negative watch in case it didn’t. Revised GDP data shows that the consumer spent more on goods and services in the first quarter than early reports, and today’s economic data also suggests the economy is gaining momentum and the job sector is still tight. Fed fund futures are now pricing in the likelihood of one to two more rate hikes this year, now becoming baked into market sentiment.
US Dollar Short-term Outlook: USD Rips into Make-or-Break Resistance
A three-week rally in the US Dollar takes DXY into multi-month downtrend resistance- battle-lines are drawn. Levels that matter on the short-term technical charts.
$80 Oil, despite current weakness?
My colleague Fawad Razaqzada recently noted that the Brent oil price has been testing upwards resistance for several days, but concerns over demand have prevented the bulls from committing to the upside. In recent days the bulls have been given supply side reasons to support an upward move, with news that suggests a tighter oil market in the second half of the year. Could oil move back above $80?
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US Dollar Price Action Setups: EUR/USD, GBP/USD, USD/CAD, USD/JPY
The US Dollar has continued to show strength and EUR/USD is testing a key spot of support at 1.0750. Can Dollar bulls continue to drive FX trends?
Oil shines as Nasdaq 100 dips, with VIX fear index climbing
The VIX, Wall Street’s fear index, rose to 21 this morning, pricing in fears that the debt ceiling talks don't go well, and/or rates will rise further. Oil prices shone on news that supplies might tighten in the near future, bad news for economic growth and inflation. Today’s release of the minutes of the May Federal Reserve meeting reported significant uncertainty on where rates go next.
VIX risk index rises, Gold unchanged, Nadaq 100 off recent highs
The S&P 500 and Nasdaq 100 were off in morning trade, as debt ceiling talks have yet to produce much progress, despite all the positive rhetoric coming from both sides. The Ukraine war looks to be hotting up, with the risk that commodity prices (and so inflation) will spike. Interestingly, the VIX, Wall Street’s fear index, is creeping up and Gold prices, another risk indicator, were unchanged after recent selling.
Gold, Silver prices dip as debt talks make progress
Debt ceiling talks were the key motivation for gold and silver price slipping this week. After an intraday high of $2,048 per ounce on 10 May, gold fell below the $1,980-$2,000 support level to stand at [$1,960] at the time of writing. The technical position is weakening for gold and silver. Professional and physical market players are not currently prepared to take directional views. For more detailed market commentary go to StoneX Market Intelligence, https://my.stonex.com/.
Nasdaq 100 hits year highs, in the face of debt ceiling and rate rise risks
Wall Street continues to reflect confusion amid contentment, with the tech sector leading, even as debt ceiling talks in Washington remain uncertain. The Nasdaq 100 hit a 12-month high. On the other hand, traders are finally starting to believe that the Federal Reserve may not be finished with rate hikes – and with good reason after comments from Fed governor James Bullard. This week is light on economic data.
S&P 500 at risk in ‘gathering storm’
We believe that the S&P 500 will experience a correction of at least 10% in the next six months for the following reasons, discussed in this article by our global strategist Vincent Deluard. In a hotter-for-longer economy, rates should stay high for longer, which would be bearish for stocks. The only justification for the fact that S&P 500 index trades for a near-record 20 times forward earnings is that rates will soon fall to zero again. If rate cuts do not come in the second half, we expect multiples to fall to 15 – bring on a more sizable correction.