Weekly Market Review – May 23–27 2016
Key economic data, including various GDP reports will be released. Most of the major currencies will be impacted.
Almost all major currencies closed last week below zero. The biggest growth against US dollar came via the British pound (+ 1.01%). The drop on the other hand showed the New Zealand dollar (-0.05%), the Australian dollar (-0.67%), the Euro (-0.76%), Canadian dollar (-1.32%), Japanese yen (-1.36%) Swiss Franc (-1.47%). The main event that helped the USD was last week’s FOMC Meeting Minutes, with the Fed stating that a June rate hike is a possibility. This overall sentiment of course caused the USD to rise significantly. Additionally, talk of a Brexit played a major role on the currency market. According to the latest information, majority of UK citizens do not want the country to exit from the EU, as many fear the negative consequences.
As this week unfolds many key economic statistics will be released. Various GDP findings including that of the UK and the US will be published on Thursday and Friday respectively. Furthermore, before that, the Bank of Canada will announce their interest rates on Wednesday 14:00 GMT.
Major US stocks traded with mixed dynamics last week. On the one hand rising oil prices provided some key support for the stock markets. However, various US economic statistics exerted downward pressure on the stock market such as last Tuesday’s US inflation data, which beat most forecasts. Additionally, the possibility of a June rate hike put further pressure on the US stock indexes. Nevertheless, at the end of the trading week, US stocks recovered lost ground as positive corporate reports flowed in.
European stock markets including the FTSE 100 reacted to the region’s economic statistics. Thus, according to the presented data, inflation in the UK slowed slightly in April, which boosted that particular index. In the Eurozone signs of deflation were certainly present. Furthermore, data on the British labor market including the nation’s retail sales proved to be better than what was expected, which provide some impact on the market. This week there will be important data on the German and British GDP, which will almost certainly affect the DAX and the FTSE 100.
Crude Oil Futures, Daily
Crude oil prices grew strongly during the first half of the week, aided by the US Institute of Petroleum reduced inventories. Nevertheless, the Department of Energy released opposing data, indicating that the inventories increased. Furthermore, during Friday’s session crude oil lost over $1.5, after data on the number of active rigs was published. Interestingly enough most analysts believe that higher oil prices will once again return to the US market.