European averages take the lead as indices probe higher

Intermediate

Macroeconomic/ geopolitical developments

  • A quiet week in financial markets with muted central bank activity and a relatively light data calendar.
  • The standout on Wednesday was a more hawkish tone from the Reserve Bank of New Zealand (RBNZ).
  • This helped the New Zealand Dollar post firm gains across the Forex board.
  • Cryptocurrencies remained volatile, with Bitcoin unable to hold onto rebounds since the May plunge.
Bitcoin bear

Global financial market developments

  • European averages have taken the lead from their US counterparts in the past week, with the EURO STOXX 50 hitting a new cycle high.
Euro Stoxx Chart
  • Global stock averages also pushed higher, but US averages are still capped below record and multi-month highs.
  • Big Tech is starting to rebound, and the Nasdaq probed back higher.
  • The US Dollar Index has AGAIN, held above key support.
DXY chart
  • The Euro is still indecisive, with EURSD capped below key resistance.
  • USDJPY is strengthening.
  • NZDUSD reacted positively to the more hawkish tone from the RBNZ (as above).
  • Gold pushed higher again, sustaining an upside bias.
  • Oil has bounced and extended higher.
  • Copper bounced too, aiming back at the recent multi-year peak.

Key this week

  • Geopolitics:
    • A holiday in the UK and US on Monday, local markets are closed.
    • Still looking for further easing of lockdown measures, particularly in Europe.
    • Monitoring COVID-19 cases, hospitalisations and deaths globally, alongside the spread of the Indian variant in the UK and Europe.
  • Central Bank Watch:  A quiet week for central banks, with the Reserve Bank of Australia (RBA) interest rate decision and statement on Tuesday.
  • Macroeconomic data: A busy data week with global Markit Manufacturing, Services and Composite PMI, plus the US ISM Manufacturing and Services PMI on Tuesday and Thursday, with the US Employment report on Friday.
DateKey Macroeconomic Events
31/05/21UK and US holidays, these markets closed; China PMI; German CPI
01/06/21RBA interest rate decision and statement; global Markit Manufacturing PMI; German Unemployment; EU CPI and Employment; US ISM Manufacturing PMI
02/06/21Australian GDP; German Retail Sales
03/06/21Global Markit Services and Composite PMI; US ISM Services PMI
04/06/21US Employment report; Canadian Employment report

Editor in chief

Steve Miley is the Market Chartist and has 29 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Mar... Continued

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