Article / 11 July 2016 at 22:58 GMT

US Market Wrap: Dollar mixed as S&P500 soars to a new high

FX Trade Strategist /

  • Australia: NAB Business Confidence Index                                     2130 GMT 
US Data released

  • Nothing of note 

Sterling was the stand out performer of the day. GBPUSD opened at 1.2866 and soared to the day's high of 1.3017 within the first hour of trading when Conservative leadership candidate, Andrea Leasom quit the race. (See Saxo on Brexit: Leadsom pullout underpins UK crisis) Theresa May is now the new leader of the ruling Conservatives in the UK, and Prime Minister-in-waiting, by default,

EURUSD followed GBPUSD higher but the magnitude of the move was much narrower.

Crude oil prices came under renewed pressure and WTI hit a two-month low at $42.42/barrel as traders became concerned that perhaps the oil supply imbalance was still an issue. A Reuters analyst blames hedge funds liquidating bullish bets for part of the WTI weakness. The WTI drop also turned USDCAD bid.

Kansas City Fed President, Esther George, said that interest rates were too low  in a speech that she gave in New Mexico on Thursday. George added that “moving rates to a more-normal level and at a gradual pace is necessary to minimize distortions in the economy that can build over many years when rates are held so low". Her remarks didn’t hurt equity markets.

The S&P 500 index made another new high. The prospect of additional easing by major central banks, a Federal Reserve that is in park, and a strong employment report that implies additional economic growth contributed to the equity demand.

 Crude oil prices are under renewed pressure and WTI has hit a two-month low on trader concerns over a possible oil supply imbalance. Photo: iStock


Today's record close for the S&P 500 didn't surprise Saxo Bank Technical analyst Kim Cramer Larsson, who wrote: Wall Street ready to break records?

– Edited by Robert Ryan

Michael O'Neill is an FX consultant at IFXA Ltd. Follow Mike or post your comment below to
engage with Saxo Bank's social trading platform.

Missed a day? Here’s what we had to say during our Asian session and our regular European Morning Markets, From the Floor and Mid-session Europe. 


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