Global Markets:
- Asian stock markets: Nikkei down 1.50 %, Hang Seng lost 0.30 %, ASX 200 down 1.40 %
- Commodities: WTI Oil at $48.90 (-0.30 %), Brent Oil at $52.00 (-0.30%), Gold at $1260 (+0.15 %), Silver at $16.86 (-0.25 %)
News & Data:
- Australia Employment Change Apr: 37.4k, Est. (5k), Prior (60.9k)
- Australia Unemployment Rate Apr 5.7%, Est. (5.90%), Prior (5.90%)
- New Zealand Consumer Confidence Index (May) 123.9, Prior (121.7)
- New Zealand Consumer Confidence (MoM) May 1.8%, Prior (-2.8%)
- Japan GDP SA (QoQ) Q1 P: 0.5%Est. (0.40%), Prior (0.30%)
- Japan GDP Annualized SA (QoQ) Q1 P: 2.2% Est. (1.80%), Prior (1.20%)
Markets Update:
Another risk-off session as the markets remain worried about the crisis within the White House. US President Trump is facing on-going criticism about his practices, and the recent allegations are the most serious ones so far. It is clear that the planned tax reform will once again have to wait. Trump has plenty of other issues that he has to deal with at the moment.
This led to profit taking in the global equity markets. The SP 500 declined more than one percent, and all the major EU indices fell too. The short-term outlook for the global stock markets has turned negative.
The risk-off sentiment was also present in the FX market. After breaking below a key support level at 113, downside momentum in USDJPY accelerated sharply and the pair declined towards 111. The next important support level now lies at 110. As there are not many near-term catalysts that could support the Dollar, the pair will likely remain under pressure.
Meanwhile, the Euro continues to show strength. Good economic data out of the Euro Zone have been supporting the currency. The outlook looks also bullish from a technical perspective. The next significant resistance level now lies at 113.
While the US Dollar is rather weak, the Australian Dollar failed to benefit much from it. The risk-off theme is weighing on the AUD as well. It would need a clear break above .7450 resistance to change that. AUDUSD could then head towards 0.76.
Upcoming Events:
- 09:30 BST – UK Retail Sales
- 13:30 BST – US Initial Jobless Claims
- 13:30 BST – US Philadelphia Manufacturing Index
