US stocks wavered after mixed economic data from the US. Data from the Labor Department showed that the number of Americans filing for jobless claims declined from 377k to 348k last week. This was a better number than the expected decline to 363k. As a result, the number of continuing jobless claims declined from 2.89k to more than 2.82k. On the other hand, the Delta variant has led to manufacturing challenges. The Philadelphia Fed manufacturing index declined from 21.9 in July to 19.4 in August. This decline was worse than the median estimate of 23.0. The top corporate news was at Johnson & Johnson where the CEO stepped down and that Amazon is planning large retail location in the US.
The Japanese yen was little changed after the country published relatively weak inflation data. According to the statistics agency, the national consumer price index rose from 0.1% to 0.2% on a month-on-month basis. As a result, the CPI made a modest improvement to -0.3% on a year-on-year basis. Meanwhile, the national core CPI that excludes the volatile food and energy prices, rose from 0.1% to 0.2%. As a result, the Bank of Japan will likely maintain its policies in the near term.
The key events to watch today will be the retail sales data from the UK and Canada. Analysts expect the UK data to show that retail sales declined from 9.7% in June to 6.0% in July. On a month-on-month basis, they expect that sales declined from 0.5% to 0.4%. The core retail sales are expected to drop from 7.4% to 5.7%. The UK will also publish the latest public sector borrowing data. The other key event will be the latest Canadian retail sales numbers that are expected to show that sales bounced back by 4.4% in July. In the US, Fed member Robert Kaplan will deliver a speech almost two days after the bank released its minutes.
EURUSD
The sell-off of the EURUSD pair accelerated in the overnight session. The pair moved to a low of 1.1678, which was the lowest level since November last year. On the daily chart, it moved below the March low at 1.1700. It also declined below the 25-day and 50-day moving average and is along the 38.2% Fibonacci retracement level. The pair has also formed an M-pattern. Therefore, the overall sentiment is bearish, with the next key support being at the 50% Fibonacci level at 1.1500.
GBPUSD
The GBPUSD pair relentless sell-off continued in the overnight session. It declined to a low of 1.3623, which is the lowest it has been since last week. On the daily chart, the pair moved below the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has moved close to the oversold level at 30. It is slightly above the key support at 1.3571. Therefore, a bearish breakout below this level will see it drop further to below 1.3600.
UKOIL
The price of Brent crude oil dipped sharply on Thursday as investors continued worrying about Delta variant cases. The price declined to a multi-month low of 65.87. On the four-hour chart, it moved below the important support at 67.62. Also, the price remained below the 25-day moving average while the MACD has moved below the neutral level. The overall trend of oil prices is bearish.
