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Market Wrap – 29th July 2022

 

MARKET WRAP – 29th July 2022

  • The AUD/USD pair found demand ahead of the US close, trading at around 0.6970. Recession-related fears pushed investors into the greenback but soaring US indexes underpinned the pair.

 

  • The Dow Jones Industrial Average rose 1% to 32,529.63, the S&P 500 climbed 1.2% to 4,072.43 and the Nasdaq Composite was 1.1% higher at 12,162.59.

 

  • • Asian equities closed largely higher with the Hang Seng underperforming its peers down 0.2%. The ASX finished Thursday’s session up 1.0%, with minerals leading the gains up 2.4%, as iron ore futures rose ~4%.

 

  • China’s Politburo calls for stabilising of the property market. China vowed to strive for ‘best outcome’ for 2H Economic Growth.

 

  • German preliminary July EU harmonised CPI rose 0.8% m/m, beating expectations of 0.4%, and up from a previous -0.1%.

 

 

  • US Q2 GDP printed at -0.9%, down from -1.6% and well below expectations of +0.4%, the result seeing the US enter a technical recession. Personal Consumption fell from 1.8% to 1.0% to fall short of expectations of 1.2% with Core PCE falling from 5.2% to 4.4% as expected. Also released and weekly jobless claims data was mixed with initial claims at 256k compared to estimates of 250k while continuing claims were 1.359 million to be lower than expectations of 1.386 million.

                                                                      FX

  • The greenback comes under pressure following the release of the flash Q2 GDP figures, although it manages well to keep the trade in the 106.50/60 band so far when tracked by the US Dollar Index (DXY).

 

  • The EUR/USD pair trades around 1.0180, shrugging off downbeat European data and fears of an EU economic setback. Worse-than-expected US Gross Domestic Product put financial markets upside down on Thursday.

 

  • GBP/USD seems to have steadied above 1.2100 after having tested that level earlier in the day. Although the dollar is struggling to gather strength following the disappointing US data, the pair continues to trade in negative territory.

 

  • USD/JPY is falling like a house of cards after surrendering the crucial support of 136.40 in the early Tokyo session. The pair has lost roughly 1% and is likely to display more losses ahead as the US dollar index (DXY) is heavily dumped on the less hawkish Fed. US GDP awaited.

 


                                                    TODAY’S KEY RISK EVENTS

  • European GDP data will be in focus today with preliminary estimates to be released at market open. The RBA will publish the monthly credit figures for June this morning, which we expect to show some slowing in housing credit growth given both housing prices and turnover are declining.

 

 

                                                                                                          

CURRENCY/INDICIES RANGES

Currency Pair Low High
AUD/USD 0.6955 0.70135
EUR/USD 1.0114 1.0234
GBP/USD 1.2105 1.21915
USD/JPY 134.2 136.57
NZD/USD 0.62515 0.6292
USD/CAD 1.2795 1.2869
USD/CNH 6.7348 6.7555
AUD/JPY 93.54 95.59
AUD/NZD 1.1098 1.1179
DXY 106.059 106.975

 

Equity Index Daily % Change Closing Level
ASX 1.0% 6890
SHANGHAI COMP 0.2% 3283
NIKKEI 0.4% 27815
FTSE 0.0% 7345
DAX 0.9% 13282
CAC 1.3% 6339
DOW JONES 1.0% 32530
S&P 500 1.2% 4071
NASDAQ 1.1% 12163
VIX -3.4% 22.46
 
     
Commodity Daily % Change Closing Level
CRUDE OIL -0.1% 97.2
ICE NAT GAS -11.6% 373.9
GOLD 0.1% 1755.6
SILVER 0.4% 20.0
SGX IRON ORE -0.8% 117.8
CMX COPPER 1.6% 348.6
ICE SUGAR 1.8% 17.7
ICE COTTON 1.2% 373.9
CBT WHEAT 3.3% 816.5
BITCOIN 0.4% 23865.3
 
     
Rates Markets Yield Daily Change
US 2 YEAR 2.87% -12.9
US 10 YEAR 2.67% -11.7
AUST 2 YEAR 2.58% -3.3
AUST 10 YEAR 3.21% -4.3

Source – Bloomberg

   

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Disclaimer: This material is provided by Navigate Global Payments (Navigate) ACN 615 699 888, AFSL 502711. The material contains general commentary only and does not constitute investment or any other advice. Certain types of transactions, like futures, options and high yield securities can be risky, and not suitable for all investors. This information has been prepared without considering your objectives, financial situation or needs. Please seek your own independent legal or financial advice before proceeding with any investment decision. The information is believed to be accurate at the time of compilation and is provided in good faith. Navigate does not warrant the accuracy or completeness of any information contributed by a third party. The information is subject to change without notice and Navigate is under no obligation to update the information. The information contained in this material are opinions of the author at the time of writing and does not constitute an offer, recommendation to act, a solicitation of an offer, or an inducement to subscribe for, purchase or sell any financial instrument or to enter a legally binding contract. This information, including any assumptions and conclusions is not intended to be a comprehensive statement of relevant practise or law that is often complex and can change. Past performance is not a reliable indicator of future performance. Any forecasts given in this material are predictive in character.

 

 

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Disclaimer:This material is provided by Navigate Global Payments (Navigate) ACN 615 699 888, AFSL 502711.  The material contains general commentary only and does not constitute investment or any other advice.  Certain types of transactions, like futures, options and high yield securities can be risky, and not suitable for all investors.  This information has been prepared without considering your objectives, financial situation or needs.  Please seek your own independent legal or financial advice before proceeding with any investment decision. The information is believed to be accurate at the time of compilation and is provided in good faith.  Navigate does not warrant the accuracy or completeness of any information contributed by a third party. The information is subject to change without notice and Navigate is under no obligation to update the information. The information contained in this material are opinions of the author at the time of writing and does not constitute an offer, recommendation to act, a solicitation of an offer, or an inducement to subscribe for, purchase or sell any financial instrument or to enter a legally binding contract.  This information, including any assumptions and conclusions is not intended to be a comprehensive statement of relevant practise or law that is often complex and can change.  Past performance is not a reliable indicator of future performance. Any forecasts given in this material are predictive in character.

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