Precious metals take a step back as the greenback shines

Summary:

• European equities push higher at the beginning of the new trading week

• A crypto-related company has been listed on the LSE

• USD shines while GBP deepens decline

• A stream of data from the Chinese economy scheduled for this week

As it is usual the case on Mondays the economic calendar is empty. However, we will get some crucial readings from the Chinese economy this week therefore we encourage you to take a look at our weekly calendar review that is available here. Equities from the Western Europe trade generally higher but weakness can be spotted on the Italian and Spanish stock markets. The US dollar and the Swiss franc are advancing against other majors while the British pound is deepening its decline being the worst performing G10 currency. On the commodity front we are observing declines among precious metals amid strengthening of the US currency. Apart from that, oil trades noticeably higher, just as heating oil. Investors should be aware that trading on the CAD tied FX pairs may be a bit more sluggish today as the Canadian investors are taking a day off for the Civic holiday.

At the beginning of July we have pointed that the declines on the oil market are probably just temporary and will lead to WTI testing $65 handle. Key technical levels have not been disturbed and prices have begun to increase once again. Nevertheless, we are encountering range trading that reflects the uncertainty concerning the future of the market.

Let’s move to London where the first crypto company has gone public on the London Stock Exchange. The firm is called Argo Blockchain, and it has raised £25 million through an IPO. The company’s IPO unveiled an overwhelming interest in firms connected to the digital assets as it has raised around a quarter more than it initially planned.

While data flowing from the European economy begin showing some worrisome signals, there are more and more ECB policymakers opting for rate rises. Over the weekend we had a speech from Lautenschlaeger who backed gradual interest rate rises. Although, she said that she is very much in favour of normalising monetary policy, she notice that it would be wrong to rise borrowing costs too quickly.

Over the weekend we were also offered some interesting tweets from the US President Donald Trump. In these tweets he hailed effects of implemented tariffs saying that they "have had a tremendous positive impact on our steel industry" adding that they "are working far better than anyone ever anticipated".