US open Futures rebound USD falls as NFP misses
559K jobs were created in US in May, fewer than the 650k forecast. The data has calmed fears that the Fed could move sooner to taper support. The Nasdaq is outperforming whilst US Dollar declines.
Share this:
US futures
Dow futures +0.25% at 34654
S&P futures +0.25% at 4203
Nasdaq futures +0.1% at 13550
In Europe
FTSE -0.45% at 7040
Dax -0.16% at 15630
Euro Stoxx -0.1% at 4075
Learn more about trading indices
Stocks rise as Fed fears ease
US futures are pushing higher rebounding from earlier weakness after a mixed non farm payroll report. The closely watch US jobs report revealed that 559k new jobs were created in May, a rise from April but this was short of the 650k that analysts had penciled in. This is the second straight month that the headline NFP report missed expectations as companies faced difficulties hiring.
Either childcare challenges as most school districts have not returned to full time in person learning or a lack of motivation thanks to the stimulus checks have meant filling vacancies is proving more challenging than usual for companies. Whilst this is driving up average hourly wages, the market it more focused on the fact that the headline NFP wasn’t a blowout number.
The data has helped calm those fears that dominated yesterday that the Fed could start to taper support sooner. The tech heavy Nasdaq which was hardest hit on Thursday is outperforming its peers today.
Investors don’t consider that NFP could also push the Fed to taper support more quickly than the market had expected. As a result, the US Dollar is declining whilst stocks are heading northwards.
Where next for the Nasdaq?
Despite yesterday’s 1% decline the Nasdaq remains above its multi- month ascending trend line. It trades above its 100 day ma but below its 50 ma. The RSI is neutral at 50. The Nasdaq looks relatively range bound for now. It would take a move below 13400 the 100 sma and horizontal support for the sellers to gain traction. Buyers could be looking for a move above 13840 to confirm a bullish outlook.
Equities
The so-called meme stocks are likely to remain volatile again on Friday with AMC Entertainment seen opening lower after the cinema chain raised funds late on Thursday and closed 18% lower. The company has still doubled in value this week and jumped 450% this month as the new darling of retail of retail investors.
Docusign trades 5% high pre-market after beating in Q1 earnings.
Lululemon Athletica trades +0.9% pre-market after reporting an 88% jump in Q1 sales.
FX – USD drops, EUR sees disappointing retail sales
The US Dollar has fallen sharply following the NFP report.
EUR/USD is trading lower after Eurozone retail sales disappointed. Retail sales fell by -3.1% MoM in April, more than the -1.2% decline expected. This comes after a 3.3% MoM increase in March. Parts of the Euro area lockdown in April as the third wave of covid hit the continent.
GBP/USD+0.14% at 1.4125
EUR/USD -0.11% at 1.2114
Oil set for weekly gains
Oil prices are pushing higher on Friday and are looking to book gains of over 4.5% across the week driven by a strong demand outlook. Demand is expected to continue rising in the US, China and Europe outstripping supply in the second part of the year and overshadowing weakness in Asia.
EIA inventory data revealed a bigger than anticipated draw in crude inventory of 5 million barrels versus 2.4m draw forecast.
Attention will turn towards the Baker Hughes rig count to see whether crude oil trading at its highest level since October 2018 is attracting more rigs to reopen.
US crude trades +0.22% at $68.88
Brent trades +0.12% at $71.32
Learn more about trading oil here.
The complete guide to trading oil markets
Looking ahead
15:00 US Factory orders
18:00 Baker Hughes rig count
US futures
Dow futures +0.25% at 34654
S&P futures +0.25% at 4203
Nasdaq futures +0.1% at 13550
In Europe
FTSE -0.45% at 7040
Dax -0.16% at 15630
Euro Stoxx -0.1% at 4075
Learn more about trading indices
Stocks rise on weak NFP report
US futures are pushing higher rebounding from earlier weakness after a mixed non farm payroll report. The closely watch US jobs report revealed that 559k new jobs were created in May, a rise fro April but this was short of the 650k that analysts had penciled in. This is the second straight month that the headline NFP report missed expectations as companies faced difficulties hiring.
Either childcare challenges as most school districts have not returned to full time in person learning or a lack of motivation thanks to the stimulus checks have meant filling vacancies is proving more challenging than usual for companies. Whilst this is driving up average hourly wages, the market it more focused on the fact that the headline NFP wasn’t a blowout number.
The data has helped calm those fears that dominated yesterday that the Fed could start to taper support sooner. The tech heavy Nasdaq which was hardest hit on Thursday is outperforming its peers today.
Investors don’t consider that NFP could also push the Fed to taper support more quickly than the market had expected. As a result, the US Dollar is declining whilst stocks are heading northwards.
Where next for the Nasdaq?
Despite yesterday’s 1% decline the Nasdaq remains above its multi- month ascending trend line. It trades above its 100 day ma but below its 50 ma. The RSI is neutral at 50. The Nasdaq looks relatively range bound for now. It would take a move below 13400 the 100 sma and horizontal support for the sellers to gain traction. Buyers could be looking for a move above 13840 to confirm a bullish outlook.
Equities
The so-called meme stocks are likely to remain volatile again on Friday with AMC Entertainment seen opening lower after the cinema chain raised funds late on Thursday and closed 18% lower. The company has still doubled in value this week and jumped 450% this month as the new darling of retail of retail investors.
Docusign trades 5% high pre-market after beating in Q1 earnings.
Lululemon Athletica trades +0.9% pre-market after reporting an 88% jump in Q1 sales.
FX – USD drops, EUR sees disappointing retail sales
The US Dollar was trading on the front foot ahead of the ADP payroll release and extended those gains following the data.
EUR/USD is trading lower after Eurozone retail sales disappointed. Retail sales fell by -3.1% MoM in April, more than the -1.2% decline expected. This comes after a 3.3% MoM increase in March. Parts of the Euro area lockdown in April as the third wave of covid hit the continent.
GBP/USD +0.14% at 1.4125
EUR/USD -0.11% at 1.2114
Oil set for strong weekly gains
Oil prices are pushing higher on Friday and are looking to book gains of over 4.5% across the week driven by a strong demand outlook. Demand is expected to continue rising in the US, China and Europe outstripping supply in the second part of the year and overshadowing weakness in Asia.
EIA inventory data revealed a bigger than anticipated draw in crude inventory of 5 million barrels versus 2.4m draw forecast.
Attention will turn towards the Baker Hughes rig count to see whether crude oil trading at its highest level since October 2018 is attracting more rigs to reopen.
US crude trades +0.22% at $68.88
Brent trades +0.12% at $71.32
Learn more about trading oil here.
The complete guide to trading oil markets
Looking ahead
15:00 US Factory orders
18:00 Baker Hughes rig count
Latest market news
The complete CFD trading experience
Award-winning platforms, competitive spreads, low commissions and dedicated support.
We live and breathe the markets and are dedicated to helping traders realise their ambitions as we continue to set the industry bar.
Economic calendar
Web Trader platform
Our sophisticated web-based platform is packed with features.
Related articles
S&P 500 forecast: Stocks extend drop as correction risks grow
US and global equity markets have extended Wednesday’s sell-off, with Wall Street opening lower after a weak handover from Asia and Europe. The deterioration in risk appetite has been spreading across global markets. The dollar was firmer, Treasury yields were holding onto yesterday’s gains, while gold, silver and bitcoin were all under pressure alongside equities and major currencies.
Wall Street Forecast: DJIA falls as treasury yields hit new highs and ahead of the Trump-Xi summit
U.S. stocks are falling, further extending losses from the previous session, as oil prices move higher alongside Treasury yields and caution reigns ahead of the summit between President Trump and Xi Jinping.
Oil, USD/JPY Forecast: Two trades to watch
Oil recovers above $90 amid a lack of progress in US-Iran diplomacy. USD/JPY rises to 158 on widening Fed-BoJ policy outlook.
StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation.
StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.