Oil pops on EU’s Russian oil ban

 

“Best startups generally come from somebody needing to scratch an itch.” — Michael Arrington 

 

 

HEADLINES

 

Dollar stronger as inflation worries dampen risk sentiment 

Gold Fields shells out to beat the ageing process

Oil extends bull run as EU agrees to ban most Russian oil

Global stocks fall, U.S. yields rise as oil prices reach new highs

USD/CAD: Break under mid-1.26s to open the door to a drop back toward 1.2405 – Scotiabank

GBPJPY Near Term: Upside favored

 

 

FOREX

 

CURRENCIES

 

Dollar stronger as inflation worries dampen risk sentiment 

 

 

The U.S. dollar rose across the board on Tuesday as Treasury yields climbed and worries over a further acceleration in global inflation kept investors’ risk appetite at bay. 

The dollar was supported by demand for havens. U.S. stocks fell on Tuesday as soaring oil prices and hawkish comments from a Federal Reserve official spooked investors.

The U.S. Dollar Currency Index, which tracks the greenback against six major currencies, was up 0.1% at 101.74. The dollar index, up about 6.6% for the year, is down 1.2% for May, on pace for its worst monthly loss in a year.

 

 

COMMODITIES

 

 

Gold Fields shells out to beat the ageing process 

 

 

With the gold price riding high at $1,800 or more an ounce since the start of the pandemic, it’s hard to feel sorry for Griffith or his rivals at behemoths like $54 billion Newmont (NEM.N) or $37 billion Barrick Gold (ABX.TO). Last year, the trio dug out the precious metal at an all-in cost of around $1,050 an ounce. Any proceeds above that figure flow pretty much straight to the bottom line. Gold Fields’ EBITDA has doubled since 2019, as has its market value. 

Gold Fields shares were down 13% 165.75 rand by 1330 GMT on May 31. Yamana shares were up 4% at 7.05 Canadian dollars.

 

 

ENERGY

 

 

Oil extends bull run as EU agrees to ban most Russian oil 

 

 

Oil prices extended a bull run on Tuesday after the European Union agreed to a partial and phased ban on Russian oil and China decided to lift some COVID-19 restrictions and the U.S. summer driving season kicked off. 

Brent crude for July, which expires on Tuesday, rose $1.58, or 1.3%, to $123.25 a barrel by 12:30 p.m. ET (1630 GMT), after earlier rising to $125.28 - its highest since March 9. The more active August contract hit a high of $120.80.

 

 

STOCKS

 

 

Global stocks fall, U.S. yields rise as oil prices reach new highs 

 

Global equity markets dipped while U.S. Treasury yields rose sharply on Tuesday as investors weighed the prospects of higher inflation following a phased ban of Russian oil imports by the European Union that has lifted crude prices to new highs. 

U.S. Treasury yields rose, with most maturities hitting one-week highs, as inflation concerns dominated trading after euro zone inflation climbed to a record high this month.

On Wall Street, the S&P 500 and the Dow were trading lower led by healthcare, industrial and technology sectors. The Nasdaq mad gains after reversing earlier session losses.

 

 

ANALYSIS

 

 

USD/CAD: Break under mid-1.26s to open the door to a drop back toward 1.2405 – Scotiabank 

 

“We spot support intraday at 1.2655/60 and resistance at 1.2690, although resistance likely extends up to the 1.2715 area, the early May low.”

“USD weakness through the mid-1.26s target losses to the mid-1.25s and potentially opens the door to a drop back to the Apr low at 1.2405.” 

 

 

CHART

 

 

GBPJPY Near Term: Upside favored

Technical View: Long position above 158.95. Target 162.35. Conversely, break below 158.95, to open 157.85.

Comments: The pair remains supported. Further advance favored.

 

 

 

 

Source: Trading Central 

 

CALENDAR

 

 

*Times in GMT

 

 

 

 

Source: FX Street Economic Calendar

Footnotes
https://www.cnbc.com/2022/05/31/forex-markets-euro.html
https://www.reuters.com/breakingviews/gold-fields-shells-out-beat-ageing-process-2022-05-31/
https://www.reuters.com/markets/commodities/oil-prices-rise-after-eu-bans-most-russian-oil-imports-2022-05-31/
https://www.reuters.com/markets/europe/global-markets-wrapup-1-2022-05-31/
https://www.fxstreet.com/news/usd-cad-break-under-mid-126s-to-open-the-door-to-a-drop-back-toward-12405-scotiabank-202205311340