21/06/2024 - 07:48 UTCA moderate recovery was observed in the dollar on Thursday, with the dollar index (USDX) ending the session 0.42% higher supported by data indicating that the jobs market remains strong despite a gradual cooling seen recently. Against the yen, the dollar hit its highest since April 29 as traders remain on alert for signs of continued intervention by the Bank of Japan to boost a currency that hit 34-year lows in late April.
In other news, oil prices are set for second week of gains on signs of improving demand and falling oil and fuel inventories in the U.S., the world's biggest oil consumer. Prices of the two main benchmarks WTI and Brent have risen by more than 5% since the beginning of the month as demand prospects are somewhat improved.
Even though Wall Street saw a wave of positive developments recently, especially in the technology sector, the US 500 and the US tech 100 fell on Thursday, taking a breather from their recent rally on signs of weakness in economic activity that coincided with Nvidia's retreat, dampening the tech sector's optimism.
As Nvidia’s stock price dropped over 3%, surrendering its title as the world's most valuable company to Microsoft. Nvidia's market cap dipped to $3.217 trillion, narrowly falling behind Microsoft's $3.312 trillion. Apple remains a close in third position, at $3.215 trillion. Advanced Micro Devices (AMD) enjoyed a 4% gain after Piper Sandler named them a top pick, citing promising prospects for the latter half of the year.
Economic data takes center stage today with a series of key manufacturing and services PMIs are due from the Eurozone, the UK and the US while later in the session, the US will release existing home sales numbers.
The EUR/USD pair fell on Thursday ending the session 0.38% lower, after a miss in US economic figures bolstered the Greenback.
In May, Germany's Producer Price Index (PPI) fell to 0.0% on a month-over-month basis. On a year-over-year basis, the PPI also came in below expectations, declining to -2.2% for the year ending in May. Although the annual figure improved from the previous -3.3%, it still fell short of the forecasted recovery to -2.0%.
The latest US Initial Jobless Claims numbers came in higher than expected, with 238,000 people filing for unemployment benefits in the week ending June 14. The Philadelphia Fed Manufacturing Survey for June dropped to 1.3 from 4.5, falling short of the expected 5.0.
Friday markets loom ahead with a packed data docket, with Purchasing Managers Index (PMI) figures for both the EU and the US on the cards.
Gold prices rose more than 1% on Thursday to their highest level in two weeks, as recent U.S. economic data showing signs of a slowdown in the world's largest economy boosted bets for interest rate cuts from the Federal Reserve this year.
Safe-haven Gold sees demand pick up as investors cast a worrying eye over intensifying geopolitical events on the world stage.
In the Middle East, tensions between Israel and Lebanon reached boiling point on Wednesday after Israeli officials warned they had approved plans for the Northern Command to launch an “all-out war” with Hezbollah in Lebanon. On Wednesday, Russian President Vladimir Putin signed a pact with North Korean leader Kim Jong Un that ensures either country will support the other in the case they are attacked.
Oil prices settled higher Thursday, as traders digested falling crude inventories and ongoing rising hopes for the U.S. rate cuts following weaker-than-expected economic data.
The prospect of sooner rather than later Federal Reserve rate cut also helped boost sentiment on oil prices after a flurry of weaker-than-expected economic data.
U.S. oil stocks fell by 2.5 million barrels last week barrels in the week to Jun. 14, but while that missed expectations for a decline of 2.8M barrels.
Furthermore, Oil prices have been supported because of a growing geopolitical risk premium driven by conflict in the Middle East.
U.S. stocks were mixed after the close on Thursday, as gains in the Oil & Gas, Utilities and Financials sectors led shares higher while losses in the Technology, Consumer Goods and Telecoms sectors led shares lower.
At the close in NYSE, the US 30 gained 0.77%, while the US 500 lost 0.03%, and the US Tech 100 rose 0.06%.
Economic data released earlier Thursday pointed to a slowing economy, with initial jobless claims coming in at 238,000, above the 235,000 expected, while housing starts slumped 5.5% in May. Investors also evaluated the recent economic data and commentary from Federal Reserve officials to determine the timing of interest-rate cuts this year.
NVIDIA Corporation gave up gains to trade more than 3% lower, ceding its position as most valuable to company to Microsoft.
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