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Markets Update: The dollar appreciated following the release of the U.S. payroll report. Nonfarm payrolls rose by 143,000 in January, while the unemployment rate decreased to 4.0%.
Global Markets Roundup: 7 February 2025
FESX1! | Z1! | NI225 | NQ1! | ES1! | EURUSD | USDJPY | DXY | GOLD | CL1! | ZC1! | ZS1! HG1!
Equity Markets
U.S. stock markets experienced a decline on Friday following weaker-than-expected job growth data and rising inflation expectations, which heightened the likelihood of a cautious stance from the Federal Reserve. Additionally, concerns were exacerbated by a report suggesting that President Donald Trump might implement reciprocal tariffs.
Earlier in the day, U.S. consumer sentiment unexpectedly dropped to a seven-month low in February, with inflation expectations rising to 4.3%, the highest since November 2023. Another report indicated that U.S. job growth slowed more than anticipated in January, following robust gains in the preceding two months. Despite this, a 4% unemployment rate may provide the Fed with justification to delay cutting interest rates until at least June. The final employment report under former President Joe Biden's administration revealed that 598,000 fewer jobs were created in the 12 months through last March than previously estimated. This final payroll benchmark revision was, however, less significant than the previously estimated reduction of 818,000 jobs in August.
In Frankfurt, the DAX Index fell by 134 points, or 0.61 percent, on Friday. The primary contributors to the decline included Porsche AG (-7.29%), Puma (-4.16%), and Adidas (-2.49%). Conversely, the most notable gains were observed in HeidelbergCement (1.43%), Fresenius (1.42%), and Henkel (1.38%).
Currencies
The dollar index DXY, which gauges the U.S. currency against a basket of six major currencies, including the yen and sterling, ascended to a peak of 108.02, before settling at 107.77, marking a 0.102% increase. Concurrently, the euro EURUSD depreciated after the data release, slipping by 0.09% to 1.0374. The British pound GBPUSD remained steady at $1.2439, despite a 0.54% decline on Thursday following the Bank of England's rate cut to 4.5% and its revised economic growth forecast of just 0.75% for the year, down from the previous estimate. Moreover, the dollar appreciated by 0.15% against the yen USDJPY, reaching 151.9, after earlier dipping below 151 yen for the first time since December 10, driven by expectations of further rate hikes by the Bank of Japan, supported by recent wage data.
Commodities
In the commodities market, West Texas Intermediate (WTI) crude oil rebounded on Friday from three consecutive days of losses due to the Trump Administration's tightened sanctions on Iran’s exports. WTI crude for March delivery rose by US$0.39, closing at US$71.00 per barrel, while April Brent crude increased by US$0.55, settling at US$74.84 per barrel. Gold prices also gained, driven by safe-haven buying amid a stronger dollar and lower-than-expected U.S. job growth in January. April gold futures advanced US$12.30, reaching US$2,889.00 per ounce, just below the record high of US$2,893.00 set on Wednesday. Base metals saw a rise, with LME three-month copper climbing 2.1% to US$9,482 per metric ton, and LME three-month aluminium increasing 0.55% to US$2,639 per ton.
In the agricultural sector, CBOT corn futures fell by 7-3/4 cents to US$4.87-1/2 per bushel, maintaining proximity to the 15-month high of US$4.98-1/2 reached on Wednesday. Soybean futures decreased by 11 cents to US$10.49-1/2 per bushel, following a rise to a six-month peak of US$10.79-3/4 on Wednesday. Wheat futures concluded 5 cents lower at US$5.82-3/4 per bushel, down from the three-and-a-half-month high of US$5.92-1/2. Cocoa prices continued their decline, reaching two-month lows amid signs of reduced demand. March ICE NY cocoa closed down 0.75%, while March ICE London cocoa dropped 1.15%. Sugar prices also trended lower, influenced by a stronger dollar, with March NY world sugar #11 down 1.07%.
Looking forward refer to the economic calendar below to see the upcoming events scheduled for today and the rest of the week.
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team