Forex News

In New York, the Dow Jones Index rose 654 points or 1.64 percent on Friday. Leading the gains are 3M (23.74%), Salesforce (2.35%) and American Express (2.21%).

The Ibovespa surged 1.2% to close at 127,493 on Friday, trimming the week’s loss to a marginal decline of 0.1% amid positive corporate developments. Vale rose 1.6% after a strong second quarter report, boasting a 210% net income increase compared to the previous year’s performance. Additionally, JBS saw its shares soar 7.1% after announcing plans to open a chicken breading plant in Saudi Arabia in November, which will quadruple its production capacity for chicken products to 40,000 tons per year. This news positively impacted the industry overall, lifting Marfrig, BRF, and Minerva by 3.6%, 3%, and 2.8%, respectively. Meanwhile, the consumer discretionary sector benefited from markets remaining fully priced in for a September rate cut by the US Federal Reserve with Hypermarcas (5.5%), Magazine Luiza (2.8%), and Localiza (2.2%) all posting substantial gains.

The S&P/TSX Composite Index rose 0.9% to close at 22,814 on Friday, breaking a three-day losing streak and resulting in a weekly advance of 0.5%, driven by dovish outlooks for North American central banks, which offset pressure from lower commodity prices affecting heavyweight companies within the TSX. The prospect of looser borrowing conditions created an environment for increased credit demand and reduced delinquency risks, benefiting major banks such as RBC, TD Bank, BMO, and Scotiabank, all of which rose by over 0.5%. Similarly, Brookfield added 2.1% to close at a record high of CAD 65.38, contributing to the financial sector’s average gain of 1%. The technology sector also supported the index's rise, with heavyweight Shopify jumping 0.9% and Constellation Software increasing by 2.7%. Meanwhile, despite a hotter-than-expected Core PCE Prices report in the US, markets remain fully priced in for a September rate cut by the Federal Reserve.

The S&P 500 closed 1.1% higher on Friday, the Nasdaq 100 gained 1%, and the Dow surged 654 points. Market sentiment was buoyed by new data suggesting easing inflation, reinforcing expectations for a potential interest rate cut in September. The PCE reading, the Federal Reserve's preferred inflation measure, aligned with expectations, though the core rate increased by 0.2%, slightly above the forecast of 0.1%. All sectors posted gains, led by industrials as 3M soared 23.1%, marking its best day since at least 1972. Deckers Outdoor jumped 6.5% on upbeat quarterly results, while Coursera surged 44.8% following an 11% increase in second-quarter revenue. In contrast, DexCom plunged 40% after lowering its fiscal-year sales forecast. For the week, the S&P 500 and Nasdaq declined 1.5% and 3.8%, respectively, while the Dow added 0.7%. Investors are preparing for next week's quarterly earnings reports from four of the Magnificent Seven tech giants: Apple, Microsoft, Amazon, and Meta.

WTI crude oil futures fell by 1.4% to settle at $77.16 per barrel on Friday, marking a third consecutive weekly decline due to weak Chinese demand despite positive US inventory data. Concerns about China's economic growth, highlighted by Beijing's rate cuts to stimulate the economy, negatively impacted market sentiment. China's reduced oil imports and refinery activity due to slow economic growth also weighed on prices. Additionally, ceasefire talks between Israel and Hamas eased supply concerns, adding further pressure. Meanwhile, strong US Q2 economic growth raised expectations for potential Fed rate cuts in September, which could boost oil demand. On Wednesday, the EIA reported a larger-than-expected drop in US crude inventories by 3.7 million barrels and a significant decrease in gasoline stocks by 5.6 million barrels. Looking ahead, market watchers are divided on whether OPEC+ will ease output curbs next quarter, with a meeting scheduled for August 1.

Bitcoin and Ether are on the rise. Bitcoin is leading the charge with a 2.76% gain. Ether follows with a 2.36% increase.

Top commodity losers are Corn (-6.21%), Soybeans (-3.70%) and Canola (-3.37%). Gains are led by Orange Juice (3.25%), Cocoa (2.56%) and Lumber (2.48%).

Top commodity losers are Steel Rebar (-1.66%) and Copper (-0.92%). Gains are led by Gold (0.94%).

Top commodity gainers are Natural Gas UK GBP (1.95%), Methanol (1.42%) and Natural Gas EU Dutch TTF (1.05%). Biggest losers are Heating Oil (-1.87%), Brent Crude Oil (-1.38%) and Crude Oil WTI (-1.26%).

Steel rebar futures sank past CNY 3,100 per tonne in late July, the lowest in over seven years, amid poor demand and ample supply in top consumer China. The Chinese government mandated fresh quality standards for steel rebar to start in late September, driving mills and traders to flood the market with old stockpiles before the new standards for the metal are enacted. In the meantime, China’s economy grew less than expected in the second quarter, and home prices slumped the most in nine years in June to underscore the gravity of the crisis in China’s real estate sector. The data dampened the outlook for future construction activity and increased the likelihood of China’s debt-ridden property developers to liquidate, erasing a major source of global demand and Chinese economic output. The deflationary streak caused by the housing slump prevented the Chinese government from aiding property developers, as such actions would worsen the current oversupply of housing.

US stocks rallied in afternoon trading, with the S&P 500 up 1.3%, the Nasdaq 100 rising 1.2%, and the Dow soaring over 700 points. Investors reacted positively to new data indicating easing inflation, reinforcing expectations for a September interest-rate reduction. The PCE reading, the Federal Reserve’s preferred inflation measure, met expectations, though the core rate rose 0.2%, slightly above the forecast of 0.1%. All sectors posted gains, led by industrials, with GE Aerospace climbing 3% and 3M soaring about 19%, marking its best day since at least 1972. Deckers Outdoor jumped 8% after surpassing first-quarter earnings and revenue estimates. Coursera surged 42% following an 11% increase in second-quarter revenue. Nvidia rose 1.8%, despite recent declines due to a rotation out of big tech stocks. Conversely, DexCom plummeted 42% after lowering its fiscal-year sales forecast. For the week, the S&P 500 and Nasdaq are set to drop 1.3% and 3.1%, respectively, while the Dow is up 0.8%.

Copper futures fell to $4.1 per pound in late July, extending its recent sharp downturn to the lowest in nearly four months amid mounting demand concerns from top consumer China. The Chinese government refrained from passing stimulus to target the aggressive slowdown in the world’s largest manufacturing sector, and reiterated its priority to steer the economy away from construction and industry to specialize in advanced technologies and new energies. The lack of economic support drove markets to sell off assets and base metals contracts, forcing the PBoC to deliver extraordinary rate cuts. The developments followed concerning factory activity data, with the domestically-focused NBS manufacturing PMI contracting for a second month in June, driving smelters and broader factories to rely on foreign demand for growth, as signaled by the 187% annual surge in copper exports in the period. Consequently, threats of trade barriers from the US and Europe magnified the bearish momentum.

The CAC 40 rose 1.2% to close at 7,518 on Friday, rebounding from a six-month low reached in the previous session as investors assessed a fresh wave of corporate results. Essilor led the gainers, surging 7.4% after reporting a 5.2% increase in Q2 revenue to EUR 13.29 billion, driven by strong performance in the EMEA region. Hermès shares climbed 3.4% following a 13% rise in Q2 sales to EUR 3.7 billion, surpassing forecasts and defying a gloomy trend for the luxury sector set by LVMH and Kering. Dassault Systèmes recorded a 3.6% gain after posting year-on-year increases in H1 net income and revenue. Vinci shares rose 3.5% despite a decline in H1 net income due to increased total revenue. Conversely, Capgemini shares fell nearly 2.5% after the IT group downgraded its revenue growth forecast for the year amid downturns in the automotive and aerospace sectors. Despite Friday's gains, the CAC 40 posted a 0.2% decline for the week, marking its second consecutive week of losses.

In Frankfurt, the DAX Index gained 123 points or 0.67 percent on Friday. Gains were led by Sartorius (6.96%), Rheinmetall (3.78%) and Puma (3.49%). Biggest losers were BASF (-2.31%), Fresenius Medical Care (-1.51%) and Commerzbank (-1.25%).

In Paris, the CAC 40 Index went up by 90 points or 1.22 percent on Friday. Top gainers were Essilor (7.57%), Saint-Gobain (4.32%) and Hermes International (4.21%).

The IBEX 35 rose by 0.4% to close at 11,186 on Friday, rebounding from earlier losses and mirroring the positive trend in European markets as earnings reports boosted investor sentiment. Meanwhile, the US PCE report had little impact on expectations that the Federal Reserve will cut interest rates in September. Major Spanish stocks showed mixed performance, where Inditex (+0.5%), Aena (+0.4%) and Cellnex (+2.5%) were up, while Santander (-0.5%), CaixaBank (-0.5%), Amadeus (-0.6%) and Telefonica (-0.4%) were in the red. Meanwhile, Mapfre and Fluidra were among top performers, gaining 3.3% and 2.7% respectively. For the week, IBEX gained 0.4%.

In London, the FTSE 100 Index rose 101 points or 1.24 percent on Friday. Leading the gains are Natwest (5.47%), Anglo American (5.08%) and Intertek (3.87%).

US heating oil futures declined toward $2.40 per gallon in late July, reaching a seven-week low as they tracked lower oil prices amid concerns over China's slowing economic growth, dampening the demand outlook for energy. Furthermore, easing supply concerns stemming from ceasefire talks between Israel and Hamas have contributed to the downward pressure on prices. However, recent indications of reduced supply coupled with an uptick in demand have limited the overall decline in heating oil. The latest EIA report revealed a draw of 2.753 million barrels in distillate stockpiles, significantly below the expected build of 0.53 million barrels for the week ending July 19. Additionally, heating oil inventories decreased by 489 thousand barrels, reversing the previous week’s increase, while product supplied for distillate fuels rose by 276 thousand barrels, signaling higher demand.

In the United States, key highlights will include the Fed's interest rate decision and the nonfarm payrolls report. Other important events will feature JOLTs job openings, CB Consumer Confidence, ISM Manufacturing PMI, factory orders, S&P Case-Shiller House Price Index, pending home sales, and the employment cost index. Earnings season will enter one of the busiest weeks, with megacaps Microsoft, Meta, Apple, and Amazon taking center stage. Globally, Bank of England, Bank of Japan, and Central Bank of Brazil will provide updates on their monetary policy. Inflation rates will be released for Spain, Germany, Australia, Netherlands, France, Poland, the Euro Area, Italy, South Korea, and Switzerland. Additionally, GDP growth rates will be announced for France, Spain, Germany, Italy, the Euro Area, and Mexico. In China, manufacturing and services PMIs will be closely watched. Manufacturing PMIs will also be published for South Korea, Russia, Spain, Italy, and Canada.

Canada's government budget surplus narrowed to CAD 1.1 billion in May 2024, down from CAD 3.35 billion in the same month of the previous year. During the first twelve months of the 2023/24 fiscal year (June-May), the country recorded a deficit of CAD 3.89 billion, a significant shift from the CAD 1.5 billion surplus reported in the same period a year earlier. Program expenses surged by 15.9%, excluding net actuarial losses, while public debt charges rose by 33.8% due to higher interest rates. Conversely, government revenues grew by 8.9%, driven by increases in personal income tax revenue, goods and services tax, and other non-tax revenues.