- European equities lack direction
- Increased volatility on Wall Street
- Brent crude at over 3-year high, WTI highest since 2014
European indices finished today's session in mixed moods amid surging oil prices and rising inflation expectations. Europe’s mining sector jumped 3% to post its biggest daily gain in three months as iron ore and coal rose sharply on supply fears, while base metals prices jumped on concerns about rising cost of energy and raw materials. Also, markets brought forward ECB rate hike bets alongside those on other central banks like the Fed and the Bank of England in recent weeks, after ECB policymakers discussed last week the possibility of exiting pandemic-era monetary and fiscal support measures. London's FTSE 100 climbed 0.72%, while Germany's DAX 30 slipped 0.05%. France's CAC 40 was up 0.16%, Italy's FTSE MIB 30 was down 0.46%, while Spain's IBEX 35 fell 0.63%.
US indices are swinging between gains and losses as investors weighed surging oil prices, economic worries and major earnings results ahead. On Wednesday investors will be offered reports from the large US banks that will serve as a hint at a condition of the US economy. FOMC minutes due Wednesday will be in the spotlight for any clues on the Fed's tapering timeline. Meanwhile, Goldman reduced its economic growth forecast to 4% from 4.4% and took its 2021 estimate down a tick to 5.6% from 5.7%, citing the expiration of fiscal support from Congress and a slower-than-expected recovery in consumer spending, specifically services.
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile appWhen it comes to the commodity market, crude oil has once again taken the spotlight. The price of black gold again reached its highest levels this year, which should be associated with the growing demand for this commodity due to gas to oil switching and restrained supplies from major producers. In the evening Brent gains 1.5%, and WTI rose 1.7%. On the other hand, the volatility in the precious metals market was lower today. Gold and silver had been moving sideways, both metals currently are trading 0.15% lower.
Cryptocurrencies are performing well on Monday. The main digital assets - Bitcoin and Ethereum, gain over 4%, thus we observe a continuation of the bull market. If current sentiment prevails, Bitcoin price may move towards all-time highs from April.
USDJPY pair continues its upward movement. After the resistance at the 111.50 zone was broken at the end of last week, the rally accelerated. We are currently observing a test of the resistance zone around 113.30-113.44, which coincides with the upper limit of the ascending channel and the external 161.8% Fibonacci retracement. On the other hand, if sellers manage to regain control, the zone at 112.10 should be treated as the nearest support.
USDJPY interval D1. Source: xStation5
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
