Markets uncertain despite robust US data - 6.12.2022

The Dollar strengthening is intact currently. The live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, rose 0.4% on Monday after better than expected data from the services sector.

Both GBP/USD and EUR/USD reversed their climbing Monday while the euro zone statistics office Eurostat reported retail sales in euro area declined more than expected in October. Both pairs are down currently. USD/JPY reversed its retreating yesterday while AUD/USD accelerated its sliding with the yen lower against the Greenback currently and the Australian dollar higher.

Futures on three main US stock indexes are up currently ahead of trade balance report at 14:30 CET today with the yield on benchmark 10-year Treasury notes down at 3.577%. The three main benchmark indexes ended lower on Monday recording daily losses ranging from 1.4% to 1.99% while the Institute for Supply Management reported US services industry activity unexpectedly picked up in November.

European stock indexes futures are down currently after closing lower Monday as food and beverage shares led losses. Asian indexes futures are mostly rising today with Hong Kong’s Hang Seng index leading gains as Beijing dropped the requirement for people to show negative COVID tests to enter supermarkets and offices while the Reserve Bank of Australia raised interest rates to decade highs.

Brent is rebounding currently. Prices fell yesterday despite the implementation of sanctions on Russian seaborne crude oil - the Group of Seven set a top price of $60 a barrel on Russian crude which should be reflected in tanker insurance for all carrying vessels. There are estimates this will reduce Russia’s crude exports to 2.4 million barrels per day (bpd) – 500,000 bpd lower. US West Texas Intermediate WTI dropped 3.8% but is higher currently. Brent lost 3.4% to $82.68 a barrel on Monday.