2 May: US$ firm, stocks lower after Fed dampens rate cut theory. Mfg PMIs, BOE meeting now in focus. NFP, Friday.

By | May 2, 2019

 

The US$ is firmer, while stocks and the metals are lower on Thursday, following the  comments from the Fed Chair, Jerome Powell, in his post-FOMC press conference, which dampened expectations of any potential rate cut later this year and contradicted the Tuesday comments from Donald Trump suggesting that a 1% cut to rates is needed. At the same time though, Powell did not see the case for an imminent hike either, so the status quo looks intact for the foreseeable future and the Fed statement did make note of the fact that the core PCE inflation figure has slowed to a rate 1.6%, well below the central bank’s 2% target, suggesting little movement in policy is likely any time soon. From a market perspective, the most interesting point to come out of the session was that the S+P, having put in a new all-time high earlier in the session (2960), is now lower (2915), and in the process has made a bearish key-day reversal on the charts, suggesting that we may have seen an interim top.

Looking ahead, Thursday will begin some potential activity for the NZ$ and the Aud$, with the March, NZ Building Permits (exp -1.6%mm), Australian New Home Sales both due. It then goes fairly quiet until the release of the German Retail Sales and the EU Manufacturing PMIs, while the BOE Meeting/Statement/Minutes/Vote Count/APP Facility will also take place. No change is expected and the BOE are likely to strike a neutral stance while the Brexit mayhem continues although the BOE Governor, Mark Carney will be speaking and may create some volatility. From the US, we get the weekly Jobless Claims, ISM NY Business Conditions and Factory Orders, while the ECB’s Praet and the BuBa’s Weidmann will both speak late in the day.

Economic data highlights will include:

Thur: NZ Building Permits, Australian New Home Sales, German Retail Sales, EU Manufacturing PMIs, BOE Meeting/Statement/Minutes/Vote Count/APP Facility, US Jobless Claims, ISM NY Business Conditions, Factory Orders

Market moves, in brief:

FX: DXY 97.65 (+0.13%)

Bonds: US10Y; 2.503% (+0.00%), German 10Y; 0.014% (-1.45%), UK 10Y; 1.149% (-2.98%), Australian 10Y; 1.791% (-0.47%), NZ 10Y; 1.86% (-2.62 %), China 10Y; 3.40% (0.00%)

Stock Indices: DJI; -0.61%, S+P; -0.75%, NASDAQ; -0.57%, EUStoxx50; 0.00%, FTSE100; -0.44%, Shanghai Composite; +0.52%,

Metals: Gold $1276oz (-0.52%), Silver $16.67 oz (-1.86%), Copper $2.790 lb (-3.94%), Iron Ore $93.65 per tonne (NYMEX) (-0.15%),

Oil: WTI $63.58 pb (+0.24%)

CURRENCIES
EURUSD: 1.1192
Res  1.1215  1.1240  1.1265
Sup  1.1175  1.1145  1.1110
USDJPY: 111.41
Res  111.60  111.80  112.00
Sup  111.20  111.05  110.80
GBPUSD: 1.3047
Res  1.3070  1.3130  1.3190
Sup  1.3010  1.2965  1.2905
USDCHF: 1.0178
Res  1.0205  1.0225  1.0250
Sup  1.0165  1.0145  1.0125
AUDUSD: 0.7014
Res  0.7030  0.7050  0.7070
Sup  0.7000  0.6985  0.6970
NZDUSD: 0.6619
Res  0.6640  0.6665  0.6690
Sup  0.6600  0.6580  0.6555
INDICES / COMMODITIES
S&P.fs: 2922.78
Res  2930.00  2940.00  2950.00
Sup  2915.00  2905.00  2895.00
DJ30.fs: 26384.50
Res  26450.00  26510.00  26565.00
Sup  26345.00  26290.00  26230.00
SPI200.fs: 6325
Res  6340  6355  6370
Sup  6310  6295  6280
XAUUSD: 1276.22
Res  1280.00  1285.00  1290.00
Sup  1270.00  1265.00  1260.00
XAGUSD: 14.67
Res  14.75  14.85  14.95
Sup  14.60  14.50  14.40
WTI.fs: 63.54
Res  64.50  65.40  66.55
Sup  62.85  62.05  61.00