US Stock Futures Recoup losses; Dollar Dips

Equities

Major US stock index futures rallied significantly yesterday, erasing losses incurred on Friday. The sharp drop triggered investors' interest in buying the dip, as the major fundamentals are still unchanged, and the Fed's policy remained data-dependent. The economic recovery is solid especially in the United States, despite labor supply not matching demand for now. The Dow Jones Industrial Average futures rose to 33862, the S&P500 futures rallied to 4223, and Nasdaq futures advanced to 14151.

USD

The dollar index which measures the greenback against a basket of major currencies fell to 91.80 after trading at 92.40 on the Fed's rally, the highest since April. The sharp upside rally triggered some profit-taking, which weighed on the dollar. The EURUSD recovered to $1.1921, the GBPUSD raced higher to $1.3937, and the USDCAD declined to 1.2351. Market participants are looking forward to Powell's testimony on emergency lending later today.

Metals

Precious metals prices inched higher as the dollar surrendered partial gains. The price of a gold ounce rose to $1790, the price of a silver ounce hovered near $26.01, and palladium rebounded to $2596.

Oil

Oil prices continued their upside rally, supported by optimism over recovery. Economic activity is picking up worldwide and governments are affirming their steps to remove restrictions at a faster pace. On the other hand, the failure of reaching a deal between Iran and the World's superpowers is delaying additional supply to the oil market, with inventories dipping. The West Texas Intermediate crude August delivery rose to $73.30, and the Brent blend August contract rallied above $75 to $75.20, the highest since April 2019.

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