Dollar Drifts Lower Ahead of Jobs Data
Dollar Drifts Lower Ahead of Jobs Data
Dollar
The dollar index, which measures the greenback against a basket of major currencies, tumbled to 96.95 as investors await the June job figures. The improved risk sentiment following an announcement over a vaccine by Pfizer supported the flow into riskier currencies, weighing on safe currencies such as the dollar, Japanese yen, and Swiss franc. Market participants are looking forward to the US jobs report to have more understanding of the rebound in the labor market after resuming the economic activity. The EURUSD edged higher to $1.1285, the GBPUSD rallied to 1.2506 on optimism over the future ties with the EU, and the risk-sensitive AUDUSD inched higher to $0.6943.
Equities
Major US stock-index futures extended upside rally supported by optimism over a vaccine for COVID19. STAT News reported that the vaccine developed by Pfizer and BioNTech is yielding positive results. The Dow Jones Industrial Average futures rose to 25892, the S&P500 futures advanced to 3120, and Nasdaq futures rallied to a fresh record high of 10319. Today, market participants are looking forward to the US jobs report for further insight into the economic recovery.
Metals
Gold prices declined as risk sentiment soared, supporting the flow into riskier asset classes. The price of a gold ounce dropped to $1764, the price of a silver ounce fell to $17.85, and palladium futures eased to $1918.
Oil
Oil prices rallied on hopes of a rapid and strong economic recovery, and a sharp drop in US inventories. The recent economic indicators are suggesting that the economic activity around the world is improving with life getting back to normal. However, the downside risks to the economy from second wave of infections are still there. On the other hand, the US Energy Information Administration reported a decline of 7.195 million barrels in US crude inventories, signaling improving demand. The West Texas Intermediate crude August delivery rose to $40.33, and Brent Blend September delivery ascended to $42.59.
Major Economic Events
| GMT | Country | Event | Expectation | Previous |
|---|---|---|---|---|
| 9:00 | EZ | PPI (MoM) (May) | -0.5% | -2.0% |
| 9:00 | EZ | Unemployment Rate (May) | 7.7% | 7.3% |
| 12:30 | US | Initial Jobless Claims | 1355 | 1480 |
| 12:30 | US | Average Hourly Earnings (MoM) (Jun) | -0.7% | -1.0% |
| 12:30 | US | Nonfarm Payrolls (Jun) | 3.000 | 2.509 |
| 12:30 | US | Unemployment Rate (Jun) | 12.3% | 13.3% |
| 12:30 | US | Trade Balance (May) | -53.00 | -49.40 |
| 12:30 | CA | Trade Balance (May) | -2.50 | -3.25 |
| 14:00 | US | Factory Orders (MoM) (May) | 8.6% | -13.6% |
| 17:00 | US | U.S. Baker Hughes Oil Rig Count | - | 188 |
Disclaimer
The prices and news mentioned in this outlook are absolutely no guarantee of future market performance and do not represent the view of ICM.COM. Financial markets can move in either direction causing profits to be made or complete losses to be incurred by the trader. Each trader must decide for themselves what their risk appetite is and ensure that correct risk management procedures are in place before placing any trades.
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