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General Market Analysis 21/06/2024

Mixed Day for US Markets – Dow up 0.8%

US Stock markets experienced a mixed day yesterday after trading resumed following the midweek bank holiday. The S&P and Nasdaq ultimately fell having once again hit fresh highs, finishing the day down 0.25% and 0.79% respectively, yet the Dow pushed higher, closing up 0.77% by the end of the session. US yields edged higher despite more, weaker data prints, the 2-year gaining 2.5 basis points to 4.728% and the 10-year adding 3.5 basis points to 4.251%. Currencies saw bigger moves, the dollar gaining ground again, notably against the franc and the pound as the Swiss National Bank cut rates for the second time on the trot and the Bank of England turned more dovish. Oil pushed higher, Brent up 0.75% to $85.71 a barrel and WTI up 0.74% to $82.17 a barrel and Gold notched up 2-week highs, jumping 1.4% to trade up to $2,358 at the NY close.

Rate Cuts on the Horizon

Potential interest rate differential trades are starting to hit the market this week as differing prospects for countries start to figure into central action and thinking. The Swiss National Bank cut rates for the second consecutive month last night which was a bit of a surprise to the market, and we saw some good depreciation in the franc against the dollar and on the crosses. The Bank of England held firm at 5.25% but the MPC’s rhetoric took a distinctive dovish turn which led to good moves in the pound. All eyes are still on US data and Fed prospects for the dollar and with the FOMC remaining strong on a more hawkish outlook than the market would like, there should be good opportunities in the majors in the weeks and months ahead.

Busy Run into the Weekend

Markets are set for a busy run into the weekend today as volatility from the previous sessions should kick on to today’s trading and a plethora of data releases keep traders on their toes. There is a raft of Flash Services and Manufacturing PMI data releases due out across the globe including, Australia, France, Germany, the UK and the US. The UK also has Retail Sales data due out early in the session with expectation for a 1.6% monthly rise priced in and the New York session see’s the latest update on Canada’s Retail Sales numbers where markets are expecting a month-on-month 0.7% rise in the headline figure.

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