2021-05-21 06:56:10
Vantage FX Market Outlook for 21st May 2021
#Risk sentiment. Most Asian stocks climbed Friday after technology companies led a Wall Street rebound on economic optimism and easing concern about the possibility of reduced U.S. stimulus. Dollar held a decline. A drop in U.S. initial jobless claims put the focus back on the economic recovery and away from fears that price pressures imperil loose financial conditions. Gold is around the highest price in more than four months. Bitcoin steadied after a volatile cryptocurrency slump this week. The global economic revival, the risk of a significant pickup in inflation and Covid-19 flare ups in some parts of the world continue to shape market moves. For now, growth optimism is overshadowing the latest Fed minutes, which flagged the possibility of a debate at some point on some point on scaling back the exceptional stimulus that bolstered a variety of assets.
#DXY All three main stock indexes ended in the green on Thursday to halt three-day losing streak, helped gains in technology stocks, as risk appetite returned to markets following better-than-expected jobless claims figures. Dollar Index bottomed around 89.80 on Thursday, hovering near yearly lows as better than expected jobless claims numbers drove investors into riskier assets. Treasury yields fall to 1.62%. Increase in stocks and fall in treasury yield could make investors worry about the Fed tightening monetary policy, we could possibly see a further drop in the dollar.
#Gold Gold pushed higher on Thursday to hit above $1880 per ounce, just shy of its previous high at $1890. This was due to general dollar weakness and falling treasury yields that buoyed the price of gold. Over the past week, gold has seen a rise by 2%, and a monthly rally of about 6% thus far. Gold prices could edge higher, buoyed by rising concerns of rising inflationary pressure with a burst in economic activity, as the precious metal is often seen as a hedge against inflation.
#CrudeOil #Oil Oil prices dropped by 2% overnight, continuing it’s 3rd consecutive days of losses. This comes after diplomats said that the US and Iran nuclear deal seems to have made further progress. With a further drop in oil prices, the market looks to position itself and get ready for Iranian oil to flood the markets as soon as the US lifts its sanctions on Iran. Further, the overarching issue of the virus pandemic looks to further dampen demand recovery as the UK could be delaying the reopening of its beaches and major cities as a sign of caution. At the start of the Asian trading session, WTI opened higher by about 0.5%, whilst Brent opened unchanged at 0.1%.
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