Daily summary: Risk sentiment improves at the end of the week

• European indices finished today's session mostly lower with German DAX down 0.29% led by declines in real estate companies. FTSE 100 rose 0.37% despite ongoing political turmoil in the UK following Liz Truss's resignation. On the corporate front, Adidas tumbled 8% after cutting its full-year outlook.

• The EU summit started today but so far no news regarding price caps on natural gas and electricity has been provided. 

• US indices are trading higher, with Dow Jones adding more than 1.80% and both the S&P 500 and Nasdaq up around 1.5% after report from the WSJ showed that some FED officials are signaling a desire to slow down the pace of the increase soon to gauge the impact of such tightening on growth. Also dovish comments from FED Daly supported market bulls. Tomorrow is the Fed blackout and many investors sees this as a coordinated message to push back against the market pricing in too much tightening. 

• Nevertheless several disappointing quarterly results capped gains. Snap shares plunged 30% after the company forecasted zero growth for the current quarter, triggering a selloff among other social media companies dependent on advertising revenue.

• Oil is trading higher and so are precious metals as USD weakening is easing pressure on commodity prices. Gold rose 1.7%, while silver surged 2.7%. 

• The Forex market experienced elevated volatility on Friday. Early in the session USDJPY pair jumped to fresh high at 152.00 only to fall sharply more than 2.5% on possible BoJ/Ministry of Finance intervention, which took place in the afternoon. Currently AUD and JPY are the best performing major currencies while USD and GBP lag the most.

• Cryptocurrencies also benefited from the upbeat sentiment. Bitcoin erased early losses and jumped above $19,000, while Ethereum is climbing towards psychological support at $1300. 

​​​​​​​The scale of today's BoJ intervention is around 600 pips, similar to last month's intervention. Source: Bloomberg via ZeroHedge

Gold bounced off major support at $1615 per ounce on Friday amid weaker dollar and lower treasury yields. Nevertheless as long as price sits below key resistance at $1685 per ounce, the main trend remains bearish. The aforementioned support is marked with 38.2% Fibonacci retracement of the upward wave launched in March 2020 and lower limit of the descending channel. Source: xStation5