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Markets taking a deep breath Friday morning and waiting for the US employment report for July. The US Bureau of Labor Statistics (BLS) will release the July jobs report today at 12:30 GMT. The expectations are for 200k jobs to have been added to the US economy in July and the unemployment rate is expected to be unchanged at 3.6%.
The NFP data could bring extra volatility to the global markets after recent suggestions from Fed officials of a potential slowdown in the tightening pace. A strong employment number might cause Fed officials to consider raising its key interest rates in September or October to curb inflation.
Due to the significant volatility, we may experience market gaps so we recommend that everyone should have sufficient margin coverage and be comfortable with your exposure on your account.
EQUITIES
European stocks trade lower after the release of weak Eurozone retail sales data. The data showed that eurozone retail sales dropped to 0.3 percent from a month earlier in June 2023, missing market expectations of a 0.2 percent increase. US stock futures notched up small gains on Friday Morning, but the upside pressure clearly weakened amid a solid ceiling in place.
On the earnings front, Nikola and Fisker are amongst those reporting the last quarter's financial results today.
OIL
Crude oil prices returned to 3-month highs after Wednesday’s retracement. The overall momentum remained bullish throughout the Asian session despite the strong US dollar supported by the surprise crude inventory draw. Crude oil prices have been more volatile than many other commodity or asset prices in recent days.
CURRENCIES
In the currency market, the British pound regained momentum against the US dollar and Euro after the Bank of England signals more tightening ahead. "Interest rates will not fall until there is "solid evidence" that rapid price rises are slowing" - Bank of England Governor Andrew Bailey said. The central bank increased the policy rate by 25 basis points from 5% to 5.25%. With the 14th increase in a row to combat inflation, the interest rate saw 5.25% for the first time since April 2008.
GOLD
The precious metal remains under pressure as the king dollar hovers near the 4-week highs. However, later today could see increased volatility spikes after the release of the US employment report. During the previous session, the metal failed to regain momentum following the release of the disappointing US ISM services PMI report as the traders awaiting the payrolls report from the US.
Economic Outlook
On the data front, the US ISM services purchasing managers index fell to 52.7% last month, down from 53.9% in June. The data also missed consensus expectations, with economists expecting a slight decline to 53.1%. The US factory sector showed resilience in June, as factory orders surged by 2.3%, exceeding analysts’ expectations for a 2.2% gain following a 0.4% increase in May.
Moving ahead today, the important events to watch:
UK – Non-Farm payrolls: GMT – 12:30
Canada – Employment report: GMT – 12:30
Technical Outlook and Review
EURUSD: For today the key support remains below the previous session low of 1.0910 then 1.0870. On the flip side, the immediate resistance is located above 1.0960, a break above this level will confirm a possible move to 1.1010/30.
The important levels to watch for today: Support- 1.0910 and 1.0870 Resistance- 1.0960 and 1.1030.
GOLD: For today, the first nearest support level is located at 1930. In case it breaks below this level, it will head towards the next support level which is located near 1924. On the upper side, 1940 will act as an immediate and strong hurdle while 1946 will be a critical resistance zone because above this, bulls are likely to dominate.
The important levels to watch for today: Support- 1928 and 1922 Resistance- 1940 and 1946.
Quote of the day – My experience with novice traders is that they trade three to five times too big. They are taking 5 to 10 percent risks on a trade when they should be taking 1 to 2 percent risks - Bruce Kovner.
Read more - https://gulfbrokers.com/en/daily-market-report-699
The NFP data could bring extra volatility to the global markets after recent suggestions from Fed officials of a potential slowdown in the tightening pace. A strong employment number might cause Fed officials to consider raising its key interest rates in September or October to curb inflation.
Due to the significant volatility, we may experience market gaps so we recommend that everyone should have sufficient margin coverage and be comfortable with your exposure on your account.
EQUITIES
European stocks trade lower after the release of weak Eurozone retail sales data. The data showed that eurozone retail sales dropped to 0.3 percent from a month earlier in June 2023, missing market expectations of a 0.2 percent increase. US stock futures notched up small gains on Friday Morning, but the upside pressure clearly weakened amid a solid ceiling in place.
On the earnings front, Nikola and Fisker are amongst those reporting the last quarter's financial results today.
OIL
Crude oil prices returned to 3-month highs after Wednesday’s retracement. The overall momentum remained bullish throughout the Asian session despite the strong US dollar supported by the surprise crude inventory draw. Crude oil prices have been more volatile than many other commodity or asset prices in recent days.
CURRENCIES
In the currency market, the British pound regained momentum against the US dollar and Euro after the Bank of England signals more tightening ahead. "Interest rates will not fall until there is "solid evidence" that rapid price rises are slowing" - Bank of England Governor Andrew Bailey said. The central bank increased the policy rate by 25 basis points from 5% to 5.25%. With the 14th increase in a row to combat inflation, the interest rate saw 5.25% for the first time since April 2008.
GOLD
The precious metal remains under pressure as the king dollar hovers near the 4-week highs. However, later today could see increased volatility spikes after the release of the US employment report. During the previous session, the metal failed to regain momentum following the release of the disappointing US ISM services PMI report as the traders awaiting the payrolls report from the US.
Economic Outlook
On the data front, the US ISM services purchasing managers index fell to 52.7% last month, down from 53.9% in June. The data also missed consensus expectations, with economists expecting a slight decline to 53.1%. The US factory sector showed resilience in June, as factory orders surged by 2.3%, exceeding analysts’ expectations for a 2.2% gain following a 0.4% increase in May.
Moving ahead today, the important events to watch:
UK – Non-Farm payrolls: GMT – 12:30
Canada – Employment report: GMT – 12:30
Technical Outlook and Review
EURUSD: For today the key support remains below the previous session low of 1.0910 then 1.0870. On the flip side, the immediate resistance is located above 1.0960, a break above this level will confirm a possible move to 1.1010/30.
The important levels to watch for today: Support- 1.0910 and 1.0870 Resistance- 1.0960 and 1.1030.
GOLD: For today, the first nearest support level is located at 1930. In case it breaks below this level, it will head towards the next support level which is located near 1924. On the upper side, 1940 will act as an immediate and strong hurdle while 1946 will be a critical resistance zone because above this, bulls are likely to dominate.
The important levels to watch for today: Support- 1928 and 1922 Resistance- 1940 and 1946.
Quote of the day – My experience with novice traders is that they trade three to five times too big. They are taking 5 to 10 percent risks on a trade when they should be taking 1 to 2 percent risks - Bruce Kovner.
Read more - https://gulfbrokers.com/en/daily-market-report-699
