Dollar Firms, Stock Futures Hold Gains ahead of Powell Testimony

Dollar

The dollar index, which measures the greenback against a basket of major currencies, edged higher to a one-week high of 97.73 ahead of Powell's testimony before the House Financial Services Committee. The Treasury Secretary Steven Mnuchin and Fed's Powell will be testifying on their response to the COVID19. Market participants will be looking for any hints on the future path of the monetary policy. On the other hand, the dollar earned a lift from the solid housing data, where pending homes sales rose by 44.3% in May, signaling a recovery in the housing market. Moreover, the dollar was firmer as European currencies tumbled. The EURUSD dipped to $1.1204, and the GBPUSD tumbled to a one-month low of $1.2251 as investors fear that the EU and UK won't reach a trade agreement.

Equities

Major US stock index futures finished sharply higher on Monday, supported by a drawback in the rate of increasing coronavirus cases. Investors are closely watching the developments of COVID19 and how authorities will respond to a significant rise in cases. Increased prospects of another lockdown weighed on the risk appetite in the past couple of days. However, stock benchmarks managed to recover where the Dow Jones Industrial Average futures rose to 25604, the S&P500 futures rallied to 3058, and Nasdaq futures advanced to 10027.

Metals

Gold prices continued to trade near their highest levels in almost eight years as investors awaited fresh fundamental drivers. The price of a gold ounce hovered above $1770, the price of a silver ounce held steady near $17.85, and palladium futures eased to $1920.

Oil

Oil prices raced higher on hopes of a rapid and solid recovery. The outstanding US pending lifted optimism over the economic recovery from COVID19. However, the sentiment remains a bit fragile, as investors are also assessing the return of Libyan oil supply to the market. The West Texas Intermediate crude August delivery traded near $39.50, and Brent Blend September delivery eased to $41.50.

Major Economic Events

Disclaimer

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