U.S. equity futures climbed and Asian stocks were mixed Monday following another record high for the S&P 500 Index as weak jobs data reinforced the case for stimulus. Gasoline and crude oil rose after a cyberattack forced the closure of a key U.S. pipeline.
The energy price surge is adding to the inflation debate ahead of a U.S. CPI report this week that is forecasted to show prices rising further in April. Investors will also parse comments from a series of Federal Reserve speakers for guidance on their thinking about the path of growth and policy following some softer-than-anticipated U.S. economic data.
U.S. jobs rose by 266,000 in April, trailing the projected one million jump and suggesting that the Fed may hold its accommodative stance for even longer. Treasury Secretary Janet Yellen said the report “underscores the long-haul climb back to recovery,” while reiterating her expectation for a return to full employment next year.
Some key GDP and inflation readings are due to dominate headlines in developed markets this week, as the issue of the day continues to be how reopening from coronavirus lockdowns is going.
Investors will watch to see any significant rebounds, with strong numbers expected in the UK following the latest stage of lockdown easing.
British Prime Minister Boris Johnson will hold a press conference later on Monday about how the country will move into the next phase of reopening from the COVID-19 lockdown, junior minister Nadine Dorries said.
“It does look as if the roadmap is on course,” Dorries told Sky News. “The prime minister will be making an announcement later this afternoon and he will be detailing how we’re going to unlock and when.”
Britain is slowly emerging from a months-lockdown which was imposed in January to tackle a deadly second wave. The government set out plans to slowly reopen international travel on Friday and indoor hospitality is expected to resume on May 17. Dorries, the minister for mental health, said the government needed to be careful that society did not reopen too quickly however because variants of the coronavirus have been circulating.
Keep an eye on the GBPUSD. GBPUSD is now trading above the psychological barrier of 1.40 and at the highest February 25, roughly ten weeks ago. With more positive news set to come from the UK today, this may go even higher!
A quiet week is expected in Europe, as CPIs and industrial production will be the main factors giving a temperature check on the eurozone economy.
It will be a mixed bag with a smattering of reopenings across the continent alongside some more strict lockdowns.
Elsewhere, Japanese household spending data is on the slate, alongside Australia’s retail sales and New Zealand manufacturing PMIs.
This Week’s High Impact Events
The times below are GMT+3.
Monday10th May
No High Impact Events Today
Tuesday11th May
12.30 – Australia – Annual Budget Release
Potential instruments to Trade: AUD Crosses.
17.30 – UK – BoE Gov. Bailey Speaks
Potential instruments to Trade: GBP Crosses.
Wednesday12th May
09.00 – UK–Prelim GDP q/q
Potential instruments to Trade: GBP Crosses.
12.00–Europe – EU Economic Forecasts
Potential instruments to Trade: EUR Crosses.
12.00 – GBP – BoE Gov Bailey Speaks
Potential instruments to Trade: GBP Crosses.
15.30 – US – CPI m/m & Core CPI m/m
Potential instruments to Trade: USD Crosses.
17.30 – US – Crude Oil Inventories
Potential instruments to Trade: USD & CAD Crosses.
20.01 – US – 10-Year Bond Auction
Potential instruments to Trade: USD Crosses & Gold.
Thursday13th May
15.30 – US – Employment Claims
Potential instruments to Trade: USD Crosses.
18.00– CAD – BoC Gov. Macklem Speaks
Potential instruments to Trade: CAD Crosses.
19.00– GBP – BoE Bailey Speaks
Potential instruments to Trade: GBP Crosses.
20.01 – US – 30-Year Bond Auction
Potential instruments to Trade: USD Crosses & Gold.
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