A Labour win is seen as a net positive for both the British stock markets and Sterling [Video]
|Yesterday soft data from the US fueled the Fed doves yesterday. The latest ADP report showed that the US economy added 150’000 new private jobs in June, less than expected by analysts and slightly less than last month, initial jobless claims rose, the factory orders unexpectedly fell in May and the ISM services unexpectedly contracted in June, the employment component plunged while prices fell more than expected. As such, investors saw in the data the evidence that the Fed is looking for to cut its rates. US yields and the USD fell and major US indices refreshed record before July 4th holiday.
Today, Brits are heading to the polls today aiming to oust the Conservatives from power after 14-years. A Labour win is seen as a net positive for both the British stock markets and sterling.
On the continent, the broad based dollar weakness sent the EURUSD past the 1.0750 resistance yesterday, the pair tested shortly traded past the 1.08 level, but the French political risks prevail and visibility is low into the second election weekend in France where we just don’t know whether Le Pen will or will not win a parliamentary majority.
Elsewhere, Japanese Nikkei is up for the third consecutive session and is approaching an ATH level reached back in March. The USDJPY doesn’t dare to move above the 162 for now. A broad based dollar weakness helps keeping the pressure contained.
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