Thread: Forex News from InstaForex

Wall Street Flat as Defensive Stocks Rise, Financials Slip





Wall Street was flat on the final trading day of May, as a decline in the financials sector counterbalanced gains in defensive plays. The tech-heavy Nasdaq gained 2.5 percent in May and touched a seven-month winning streak, its longest since 2013.


The Dow Jones industrial average slipped 0.1 percent to end at 21,008.65, as Goldman Sachs led losses while Pfizer was the best performer. The S&P 500 fell 0.05 percent to close at 2,411.80, as financials led four sectors down while utilities outperformed. The Nasdaq Composite shed 0.08 percent to 6,198.52.


Financials rallied over 20 percent in the aftermath of the U.S. presidential election on prospects of fiscal stimulus and deregulation under President Donald Trump. However it is currently struggling. The sector is 0.3 percent lower on the year.


JPMorgan blamed lower volatility for the 15 percent loss in trading revenue in the second quarter compared to 2016. Bank of America said trading revenue in the current quarter is poised to be 10 to 12 percent off than the previous year.


Shares of JPMorgan fell 2.1 percent and Bank of America slipped 1.9 percent, as both weighed on the S&P 500 the most. Goldman Sachs tumbled 3.3 percent, adding the most pressure on the Dow.


Defensive plays like utilities rose 0.46 percent while telecoms gained 0.35 percent. Energy stocks dropped 0.4 percent as oil prices notched a three-week low.


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China Imposes Tighter Cybersecurity Law





China has started enforcing its new cybersecurity law overseeing data gathering, amid backlash and concerns from the global community.


Essentially, the new law is requiring companies to maintain collated client information within China. Entities need to secure approval before transmitting these details outside the Asian country.


The decree, ratified in November by the country's legislative body, intends to strengthen the security of the Internet and data in response to the increasing number of firms which collect and review such details to either render services or create business plans.


Foreign entities requested for delaying the implementation of this legislation, but it did not push through. Chinese officials and non-Chinese companies are awaited to discuss the new law soon.

Australia Q1 Inventories Jump 1.2% On Quarter





Inventories in Australia were up a seasonally adjusted 1.2 percent on quarter in the first three months of 2017, the Australian Bureau of Statistics said on Monday.


That beat forecasts for a rise of 0.5 percent following the 0.3 percent gain in the previous three months.


Inventories were up 2.5 percent on year. Company operating profits advanced 6.0 percent on quarter - also exceeding expectations for 5.0 percent but down from 20.1 percent in the three months prior.


Profits were up 39.7 percent on year.


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Dollar Nurses Losses after Weak U.S. Data, Pound Slips after London Attacks





The dollar came close near a seven-month low touched after latest U.S. jobs growth in May fell short of expectations while terror attacks in London which left nearly seven people dead and 48 injured ahead of the national election dented the sterling.


The dollar index against a basket of six major currencies touched its lowest level since the November election. It last stood little changed in early Asian trading at 96.736, but not far from Friday's low of 96.654, its weakest since Nov. 9.


The sterling inched down, under pressure after the third terrorist attack in Britain. It fell as much as 0.3 percent against the dollar. Sterling trimmed losses to trade 0.2 percent lower at $1.2871 early on Monday.


The pound was battered over the past two weeks with polls showing a tightening race, which raises the possibility of a hung parliament. Leveraged clients await the results of new polls taken after the incident, according to a trader.


The greenback was stable at 110.40 yen, after slipping 0.8 percent on Friday.


The U.S. 10-year Treasury yield was at 2.1547 on Monday, having dropped from Thursday's close of 2.217 before the jobs data was released.


The euro was down 0.1 percent to $1.12745 on Monday, holding on to most of Friday's 0.6 percent gain.


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New Zealand Building Volume Slides 3.5% In Q1





The total volume of building in New Zealand was down a seasonally adjusted 3.5 percent on quarter in the first three months of 2017, Statistics New Zealand said on Tuesday.


That misses forecasts for a gain of 0.3 percent following the downwardly revised 1.3 percent increase in the previous three months (originally 1.9 percent).


Residential building activity shed 0.8 percent on quarter, while non-residential building activity skidded 7.2 percent.


The value of building work on new homes was NZ$2.7 billion in Q1.


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Treasury Yields Jumps Amid Mixed Economic Data





U.S. government bond yields rallied amid a string of data that did not help clarify U.S. economic prospects after a disappointing jobs report helped trim growth expectations.


The 10-year Treasury note yield advanced 2.2 basis points to 2.182 percent. Despite its rally, the benchmark yield's closing was still its lowest close this year. Yield on the two-year note rose 1.8 basis point to 1.308 percent, while the yield on the 30-year bond or the long bond advanced 3.1 basis point to 2.840 percent.


The movement in yields came after the ISM services index for May slid to 56.9 percent against the 57.5 percent seen in the previous month. However, April's reading marked a 12-year high and the index continued to be above the adjusted annual average of 55.9 percent.


Another report showed that U.S. productivity growth during the first quarter of the year was revised upward from 0.6 percent, indicating that economic data in Q1 was not as soft as initially reported.


In the last few weeks, muted economic data, underlined by a dismal May nonfarm payrolls report, has barely discouraged investors from betting a June rate hike. Traders are now wagering in a 95.8 percent odds of a rate increase during the Fed's next policy meeting, based on the Chicago Mercantile Exchange's FedWatch tool.


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Australia Manufacturing Sector Picks Up Steam In May - AIG





The construction sector in Australia continued to expand in May, and at a faster rate, the latest survey from the Australian Industry Group revealed on Wednesday with a Performance of Construction Index score of 56.7.


That's up sharply from 51.9 in April, and it moves farther above the boom-or-bust line of 50 that separates expansion from contraction.


It also marks the fastest rate of expansion in more than two and a half years.


Individually, apartment building saw the biggest jump, although house building fell back into contraction.


Engineering construction and commercial construction were firmly in expansion territory.


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Japan Overall Bank Lending Climbs 3.2% In May





Overall bank lending in Japan was up 3.2 percent on year in May, the Bank of Japan said on Thursday - coming in at 513.269 trillion yen.


That topped expectations for an increase of 3.0 percent, which would have been unchanged from the April reading.


Excluding trusts, bank lending was up an annual 3.3 percent to 446.592 trillion yen. That also beat forecasts for 3.0 percent, which would have been unchanged.


Lending from foreign banks gained 2.9 percent on year to 66.676 trillion yen after rising 2.8 percent in the previous month.


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Wall Street Higher Supported by Comey Relief





U.S. equities finished higher on Wednesday after written testimony from former FBI director James Comey did not provide major revelations regarding the probe into Russian meddling with 2016's presidential election.


The Dow Jones industrial average climbed 0.18 percent to end at 21,173.69, with Nike leading gains while Coca-Cola lagged behind. The S&P 500 added 0.16 percent to close at 2,433.14, as financials led eight sectors up and energy declined the most. The Nasdaq composite rose 0.36 percent to finish at 6,297.38.


The stock market mostly fluctuated this week as investors held off from making large wagers ahead of Comey's testimony.


Equities were pressured by the near two percent decline in the S&P 500's energy sector. All but two of the 34 components of the sector dropped as U.S. crude futures plunged five percent because of the sudden increase in U.S. inventories.


Signet Jewelers was the biggest percentage advancer on the S&P 500, which climbed four percent. Newfield Exploration was the biggest decliner by tumbling seven percent.


Investors are currently focused on Britain's general election and the European Central Bank's policy meeting, both on Thursday.


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Uk Election: Odds are in Decline for Conservatives





After exit polls somewhat shocked the market and pointing to YouGov model prediction just weeks ago that forecasted a hung parliament weeks ago, betting odds are in decline, except for the odds for most seats.


The betting market is pricing 93 percent probability that the Conservative will win most of the seats in 650 members’ parliament.


The market is pricing less than 62 percent probability that Theresa may be the next Prime Minister. The odds for Jeremy Corbyn has moved higher from 20 percent to 33 percent.


The market is also pricing 66 percent probability that the Conservatives will be able to hold on to their majority in the election. The odds of a Labour Party majority is currently at less than 7 percent.


The odds of a hung parliament has moved up from less than 20 percent before the election to 33 percent as of now.


Foreign Secretary Boris Johnson is the favorite with 30 percent odds to become the next Conservative Party leader if Theresa May is replaced.


Results so far:
So far, the Labour Party has won 10 seats, while the Conservatives have secured wins in five. Still, a very long way to reach the magic figure (326).


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