FOREX
The US dollar ceded ground to other major currencies during early Thursday trading. The release of US services data, indicating lower-than-expected growth, drew investors' attention to this Friday's employment data, poised to sway the Federal Reserve's decision on whether to initiate rate cuts in June or later. The US central bank's decision-making remains contingent on data, as reiterated by Chairman Jerome Powell during a recent public address. Against this backdrop, Friday's employment figures will shed further light on the state of the underlying US economy and could solidify traders' expectations regarding the timing of the first Fed rate cut, likely prompting corresponding reactions from the dollar.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
EUROPEAN SHARES
Stocks opened without clear direction on Thursday, holding yesterday’s gains following a positive trading session in Asia, as investor caution eases.
Benchmarks continue their bounce back following the sell-off registered at the beginning of the week in Europe, as Fed Chairman Powell provided bull traders with more support, saying the recent batch of macro data “didn’t materially change the picture”. This came as a relief for buyers as it is seen as a sign the Fed’s plan for rates, with three cuts in 2024 starting not later than June, is still alive.
While optimism is returning to the market, investors will cautiously monitor the next batch of data for this week, including today’s PMI and PPI data from the Eurozone and the initial jobless claims from the US.
In addition, several speeches from Fed officials alongside the publication of the minutes of the last ECB meeting may also bring higher market volatility throughout the day ahead of tomorrow’s US Non-Farm Payroll.
The STOXX-50 index is currently challenging its first short-term significant resistance at 5,081 pts, led higher by banking shares.
Pierre Veyret – Technical analyst, ActivTrades
Source: ActivTrader
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