Equities:
US equities were mixed on Friday. The S&P 500 and the Dow Jones Industrial Average continued to make record highs, up 0.1% and 0.9% respectively as rotation towards value stocks resumed. On the other hand, Tech and growth stocks came under pressure as yields jumped above 1.64%, Nasdaq Composite fell 0.6%.
According to both the chief investment and chief financial officer at FlowBank SA, Charles-Henry Monchau put emphasis on the pace of rising yields. He suggested that the rotation from growth to value will continue if bond yields rise in a steady fashion backed by underlying economic growth.
Bonds & Yields:
Treasury yields jumped higher. The US 10-year yields rose 10 points to 1.64% and the US 2-year yields rose 1 point to near 0.15%.
Forex:
The US dollar strengthened slightly against major currencies on Friday. The Euro (EURUSD) fell from highs around $1.1954 to lows near $1.1944. The Australian dollar (AUDUSD) fell from high around $0.7764 to lows near $0.7748. The Japanese yen (USDJPY) was weaker against the dollar from highs near 109.14 yen per dollar to lows near 108.49 yen per dollar.
Commodities:
The stronger dollar saw commodity prices lower slightly on Friday. Brent oil fell 0.59% to $69.22 per barrel. WTI crude fell 0.62% to $65.61 per barrel.
Metals:
Spot gold (XAUUSD) was steady near $1720 an ounce. Iron ore fell by 3.1% to $165 a tonne.
Cryptocurrencies:
To the delight of cryptocurrency traders, Bitcoin broke $61,000 to a new record before retrieving slightly below $60,000. Here is more on the future of bitcoin.
Key events to watch this week:
- US Retail Sales (Tuesday)
- US Federal Funds Rate and FOMC Statement (Wednesday)
- UK Bank of England Official Bank Rate (Thursday)
- JPY Bank of Japan Monetary Policy Decision (Friday)
Read more on forex trading for beginners.
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