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Macro Roundup (May 19)
2023-5-19
This is a roundup of global macroeconomic news last night and what is expected today.
The U.S. dollar rose to fresh seven-week peaks on Thursday after another round of solid economic data further he dollar rose to fresh seven-week peaks on Thursday as another round of solid economic data further pared back bets on easing by the Federal Reserve and amid market optimism about a U.S. debt ceiling deal to avert a potential default.
Against the yen, the dollar rose to a six-month peak and was last up 0.76% at 138.72.
Apart from debt ceiling negotiations, investors also looked at economic data, which in recent weeks have depicted strength.
Thursday’s reports showed lower-than-expected U.S. initial jobless claims of 242,000 in the latest week, compared with forecasts of 254,000.
Another piece of data indicated a milder-than-expected fall in the Philadelphia Federal Reserve’s manufacturing index to -10.4 in May from -31.3 in April. Markets were forecasting a contraction of -19.8. The index though has been in contraction since September and many of the real sector components remain in negative territory.
Traders are pricing in a roughly 33% chance that the Fed raises the benchmark interest rate at its June meeting. Around a month ago, markets were pricing in around a 20% chance of a cut.
U.S. stock futures ticked slightly higher in overnight trading Thursday as Wall Street continued monitoring the situation surrounding the debt ceiling.
Futures connected to the Dow Jones Industrial Average added 17 points, or 0.05%, while S&P 500 and Nasdaq-100 futures gained 0.1% and 0.3%, respectively.
Stocks are coming off a positive session in which the S&P 500 and Nasdaq Composite jumped 0.94% and 1.51%, respectively, to hit their highest closing levels since August. The Dow Jones Industrial Average rose more than 115 points, or 0.34%.
Thursday’s moves boosted the major averages’ weekly gains, with the Nasdaq up 3.3% and the S&P on pace to end 1.8% higher. Both are on track for their best weekly performance since March 31. The Dow is up 0.7%.
Oil prices slid about 2% on Thursday after solid U.S. economic data spurred the dollar to a two-month high on growing expectations the U.S. Federal Reserve could raise interest rates again in June.
Brent futures fell $1, or 1.2%, to $75.98 a barrel by 3:22 p.m. EDT, while U.S. West Texas Intermediate (WTI) crude fell 85 cents, or 1.1%, to $72.04.
Gold extended declines on Thursday after more strong economic readings from the U.S. further soured bets that the Federal Reserve may ease up on interest rates hikes, with bullion also pressured by optimism for a debt ceiling deal.
Spot gold fell 1.3% to $1,956.1346 per ounce by 3:24 p.m. EDT, after earlier touching its lowest since April 3 at $1,951.73.
European markets closed higher Thursday as U.S. debt ceiling talks made progress and several sectors made strong gains.
The pan-European Stoxx 600 index closed up 0.43% provisionally, with autos rising 2.5% and tech stocks up 2.5%.
The U.S. dollar rose to fresh seven-week peaks on Thursday after another round of solid economic data further he dollar rose to fresh seven-week peaks on Thursday as another round of solid economic data further pared back bets on easing by the Federal Reserve and amid market optimism about a U.S. debt ceiling deal to avert a potential default.
Against the yen, the dollar rose to a six-month peak and was last up 0.76% at 138.72.
Apart from debt ceiling negotiations, investors also looked at economic data, which in recent weeks have depicted strength.
Thursday’s reports showed lower-than-expected U.S. initial jobless claims of 242,000 in the latest week, compared with forecasts of 254,000.
Another piece of data indicated a milder-than-expected fall in the Philadelphia Federal Reserve’s manufacturing index to -10.4 in May from -31.3 in April. Markets were forecasting a contraction of -19.8. The index though has been in contraction since September and many of the real sector components remain in negative territory.
Traders are pricing in a roughly 33% chance that the Fed raises the benchmark interest rate at its June meeting. Around a month ago, markets were pricing in around a 20% chance of a cut.
U.S. stock futures ticked slightly higher in overnight trading Thursday as Wall Street continued monitoring the situation surrounding the debt ceiling.
Futures connected to the Dow Jones Industrial Average added 17 points, or 0.05%, while S&P 500 and Nasdaq-100 futures gained 0.1% and 0.3%, respectively.
Stocks are coming off a positive session in which the S&P 500 and Nasdaq Composite jumped 0.94% and 1.51%, respectively, to hit their highest closing levels since August. The Dow Jones Industrial Average rose more than 115 points, or 0.34%.
Thursday’s moves boosted the major averages’ weekly gains, with the Nasdaq up 3.3% and the S&P on pace to end 1.8% higher. Both are on track for their best weekly performance since March 31. The Dow is up 0.7%.
Oil prices slid about 2% on Thursday after solid U.S. economic data spurred the dollar to a two-month high on growing expectations the U.S. Federal Reserve could raise interest rates again in June.
Brent futures fell $1, or 1.2%, to $75.98 a barrel by 3:22 p.m. EDT, while U.S. West Texas Intermediate (WTI) crude fell 85 cents, or 1.1%, to $72.04.
Gold extended declines on Thursday after more strong economic readings from the U.S. further soured bets that the Federal Reserve may ease up on interest rates hikes, with bullion also pressured by optimism for a debt ceiling deal.
Spot gold fell 1.3% to $1,956.1346 per ounce by 3:24 p.m. EDT, after earlier touching its lowest since April 3 at $1,951.73.
European markets closed higher Thursday as U.S. debt ceiling talks made progress and several sectors made strong gains.
The pan-European Stoxx 600 index closed up 0.43% provisionally, with autos rising 2.5% and tech stocks up 2.5%.
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