5 things traders are reacting to

What traders are reacting to today.

1. China’s Jinping confirms Trump meeting
The market’s reaction to news China’s Jinping Xi will meet Trump on the side-line at the G20, has been tame. A meeting between the two is clearly a step in the right direction, but no one is being fooled into thinking that China will suddenly back down from their position. Investors are looking ahead cautiously to the G20 with a quiet optimism that some progress could be made. US equities are edging higher.

2. Commodities in focus as US threatens more sanctions on Iran
Escalating tensions between the US and Iran is keeping a lid on broader market sentiment. Gold rallied to a fresh 6 year high, whilst oil also extended last week’s gains in early trade, as the US looked to implement further sanctions on the already choking Iran. 

3. Fed battered dollar extends losses
The dollar slipped again on Monday, extending losses from its largest weekly decline in 4 months last week. The dollar dropped as the Fed opened the door to a rate cut, possibly as soon as next month. A dovish outlook on the economy by the Fed, amid concerns of a slowing global economy saw the dollar decline 1.4% versus a basket of currencies last week. The dollar is down a further 0.1% towards the end of the European session on Monday.

4. Euro – the best of a bad bunch?
The weaker dollar injected life into the euro which is looking like the best of a bad bunch right now.  With the Fed ready to cut rates and the UK set to experience 0% growth in Q2 amid lingering Brexit uncertainty, any signs of a positive in the eurozone will be well received. The IFO business climate index recorded a decline, however it was less of a decline than forecast allowing euro traders a small sense of relief. 

5. Pound pares earlier gains, has Boris dented his chances of winning?
The pound failed to capitalise on the weaker dollar. All eyes are on Westminster as Boris Johnson and Jeremy Hunt go head to head in the final leg of the Toy leadership race. Postal votes will be cast by 160,000 conservatives with the results to be revealed late July. Boris was once again driving his Brexit, come rain or shine message, as he attempted to move past the weekend’s shenanigans.  

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.