US major stock indices close lower on the day and lower on the week
Key events and releases for next week
WTI crude oil futures settle at $118.87
Iraq oil production to increase to 4.58 million barrels per day after OPEC+ decision
Walmart CEO is working really hard on costs
Fed’s Mester:US jobs report was strong.Too early to say if jobs report changes rate policy
Russia’s Putin: US decision to print money led to increase in global food prices
Baker Hughes oil rig count unchanged at 574
Major European indices close lower
Atlanta Fed GDPNow dips to 1.3% from 1.9% on May 27
Biden to ring the praises on the US jobs report
ISM nonmanufacturing PMI for May 55.9 vs. 56.4 estimate
S&P/Global services PMI final 53.4 vs. 53.5 preliminary
Starbucks set to reopen stores in China
US May nonfarm payrolls 390K vs 325K estimate
The USD is the strongest and the NZD is the weakest ahead of the US jobs report

The US employment data was released today with nonfarm payroll adding another 390K jobs. That comes after a 436K jobs increase in the prior month (was 428K). The expectations for the month was for 325K. Although lower than the prior month, it still represented a solid gain at this point in the cycle. Since January 2020 just before the impact from the pandemic, the number jobs gained have nearly erased the number jobs lost.

Payroll changes since January 2090

Other component pieces showed that the unemployment rate stayed steady at 3.6% (expected 3.5%). The participation rate increased to 62.3% from 62.5% contributed to the unchanged level in the unemployment rate. Average hourly earnings increase by 0.3% vs. 0.4% estimate. The year on year came in as expected at 5.2% (down from 5.5% last month). The underemployment rate moved up to 7.1% from 7.0%.
The May job gain was the slowest pace of growth since April of last year. Within the details, jobs fell by -61,000 in retail. The biggest gainer was leisure and hospitality which added 84,000 jobs. Consumers are shifting from buying on goods to buying services.
More recently, companies such as Twitter, Netflix, and Tesla whose Elon must said today that he plans on cutting 10% of the salary jobs, have said they look to trim jobs.
It is hard to call the job data soft, but let’s say there was a slowing of the trend which is a start.
The reaction the market saw stocks moving to the downside, and yields higher.
Looking at the major indices:

Dow industrial average fell -349.4 points or -1.05% at 32898.90. Last Friday the index closed at 33212.97
S&P index fell -68.38 points or -1.64% at 4108.43. Last week the index closed at 4158.33
NASDAQ index fell -304.15 points or -2.47% at 12012.74. Last week the index closed at 12131.13
Russell 2000 fell -14.62 points or -0.77% at 1883.05. Last week the index close at 1887.85
If you reword to put a positive spin on the price action in the stock market, the major indices all closed above their 200 hour moving average despite the week’s declines.

In the US debt market, yields move higher but came off the highest levels today. For the week, however, yields were sharply higher as traders rethought the idea of a pause in September:

2 year 2.661%, +2.7 basis points. The 2 year the yield is up from the last Friday’s closing level 2.484% for a gain of 18 basis points.
5 year yield 2.942%, +3.1 basis points. The 5 year yield is up from 2.692% last Friday or 25 basis points
10 year yield 2.946%, +3.3 basis points. The 10 year yield is up from 2.743% last Friday or +20 basis points
30 year yield 3.094%, +1.5 basis points. The 30 year yield is up from 2.972% last Friday or +12.2 basis points.

In the forex, the USD is the strongest of the majors while the JPY is the weakest. 

The strongest to weakest of the major currencies

USDJPY: The USDJPY moved to the highest level since May 9 and in the process moved above the May 11 high of 130.80. The high price today reached 130.973. The pair is closing just above the May 11 high of 130.80. On the way to the upside, the price moved above a swing area between 130.49 and 130.553. That level will be a close risk level on Monday. Stay above is more bullish. On the topside the high prices from April and May at 131.242 and 131.342 are topside targets. They also represent 20 year highs for the USDJPY.  This week, Microsoft lower their expectations for earnings and revenues on the back of a higher dollar. With the USDJPY trading near 20 highs, looking at that currency  is a chief problem for multinationals who have not properly hedge their exposure.EURUSD: The EURUSD trade above and below its 100 and 200 hour moving averages currently at 1.0718. The current prices trading right around that level and punting to next week’s price action to determine more bullish more bearish bias.  Move above the moving averages would be more bullish.  Move below the moving averages would be more bearish.  Of significance on the topside today was at the high price stalled against the high price from May 27.  Keeping below the cycle high at 1.07857 from Mondays trade, gave the sellers the shorter-term bias control. However getting and staying below the 100 and 200 hour moving averages will still be eyed in early trading next week.  GBPUSD: The GBPUSD use the 100 hour moving average as a ceiling both late yesterday and into today. That moving average currently comes in at 1.25647. The 200 hour moving averages at 1.25761. Stay below those moving averages keeps the sellers more in control. After the nonfarm payroll report, the price moved down to test a swing level at 1.2524. The price bounced back higher to retest the 100 hour moving average one last time before moving back to the downside and through the 1.2524 level. Bearish break. That level will be a close risk level early in the trading week. The price is closing the week near session lows at 1.2488. On the downside getting below the 38.2% retracement of the move up from the May 13 low at 1.24705 and staying below that level will be key for sellers/bears.Thank you for support this week. Have a great and safe weekend

The major US stock indices are ending the day lower led by the NASDAQ index which declined by 2.4%
For the shortened trading week, the indices were down 3 of the 4 trading days. After snapping a 7 week decline in the S&P and NASDAQ index ended 8 week decline in the Dow industrial average, the major indices all were lower this week.
The final numbers are showing:

Dow industrial average fell -348.58 points or -1.05% to 32899.71
S&P index fell -68.26 points or -1.63% to 4108.55
NASDAQ index fell -304.15 points or -2.47% to 12012.74
Russell 2000 fell -14.62 points or -0.77% to 1883.05

For the trading week

Dow industrial average fell -0.94%
S&P index fell -1.19%
NASDAQ index fell -0.98%
Russell 2000 index fell -0.25%

Technically, the NASDAQ index after trading below its 200 hour moving average (green line in the chart below) earlier in the session, is closing above the declining level (currently at 11971.16). Traders will be eyeing that moving average level next week as a barometer for bullish and bearish.

NASDAQ index closes just above its 200 hour moving average

Both the S&P and the Dow industrial average are also above their 200 hour moving averages:

For the S&P, the index is at 4072.43
For the Dow industrial average 200 hour moving average is currently at 32581.47

Next week, those moving averages will be in play and be used to define the short/intermediate-term bias. Stay above is more bullish. Move below is more bearish.

Next week, US CPI and Canada employment highlight the economic releases, while interest rate decisions in Australia and the EU are key central bank. Below are the major releases and events for next week’s trading:Tuesday, June 7Reserve Bank of Australia’s interest rate decision at 12:30 AM ET/430 GMT. The reserve Bank of Australia expected to raise rates by 25 basis points although there are others who expect up to 50 basis points. A total of 22 of 35 analysts look for a 25 basis point hike while 11 look for 40 basis points. There is one analyst looking for 50 basis points and 1 that is looking for no change at all. Of the big 4 Australian banks, ANZ and WPAC are calling for 40 basis points, while CBA and NAB are looking for 25 basis points. Canada Ivey purchasing managers index at 10 AM ET/1400 GMT. The Ivey PMI is expected to come in at 64.3 vs. 66.3. Historically the PMI index is very volatile. Be awareThursday , June 9ECB rate decision. 7:45 AM ET/1145 GMT. The ECB will keep rates unchanged at 0.0%. The ECB has telegraphed that until the asset purchase program is complete in June, they will not move rates. The expectations are for a 25 basis point hike in July. Year and estimates are up to 125 basis points. There are some members looking for 50 basis points to combat the higher than expected CPI inflation which top out at 8.1% this month. At 8:30 AM, ECB’s Lagarde will have her traditional press conferenceUS initial jobless claims. 8:30 AM ET/1230 GMT. The estimate is for 205K after the 200K increases weekBank of Canada Governor Macklem will speak. The Bank of Canada raise rates by 50 basis points this week. There is no press conference after the decision. As a result this will be the first opportunity for Macklem to speak about the rate hikeFriday, June 10Canada employment change. 8:30 AM ET/1230 GMT.  Employment change expected at 25.5K vs 15.3K last month.  The unemployment rate is expected to remain unchanged at 5.2%US CPI.  8:30 AM ET/1230 GMT. Month-to-month 0.7% vs. 0.3%. Year on year 8.2% vs. 8.3%. Core 0.5% vs. 0.6% last month. Core year on year 5.9% vs. 6.2% last month.Michigan consumer sentiment preliminary. 10 AM ET/1400 GMT. 56.9 vs. 58.4 last monthAlso next week, the US treasury will auction off $44 billion of 3 year notes on Tuesday, $33 billion of 10 year (9 year 11 month) notes on Wednesday, and $19 billion of 30 year bonds (29 year and 11 month) on Thursday 

The price of WTI crude oil futures are settling at $118.87. That’s up $2 or 1.71%. The high price today reached $119.42. The low price extended to $115.23. One week ago today, the price closed at $115.07. That puts the gain for the week at $3.80 or 3.3%. The high for the week reached $119.98 on Monday. The low for the week extended to $111.20. That was a yesterday after the OPEC+ decision. Working in favor of the upside was China reopening along with continued low inventories. The weekly inventory data in the US this week showed a larger than expected to draw of -5.06 million barrels this week. This despite record high prices at the pump in the US. Crude oil stretches above resistance at $117.84

According to state n crude oil production crude oil production ews agency,

Iraq oil production will increase to 4.58 million barrels per day as of July following the OPEC+ decision

Oil production is currently at 4.44 million barrels per day

Current Iraq oil production

Looking at the global crude oil production, below is the list of top 14 oil producers:

Crude oil is trading at $118.60. That’s off the high of $119.40. The high price for the week reached $119.96

Index
trading is defined as the buying and selling of a specific stock market index.
Investors will speculate on the price of an index rising or falling which then
determines whether they will be buying or selling.

 

Since an
index represents the performance of a group of stocks, you will not be buying
any actual underlying stock, but rather buying the average performance of the
group of stocks.  When the price of
shares for the companies within an index go up, the value of the index
increases. If the price instead falls, the value of the index will drop.

 

CFDs
(Contracts for Difference) have become the most popular way of trading stock
indices as they allow more flexibility and require less margin compared to
Futures contracts traded on exchanges.

 

The main
benefits of trading index
CFDs are that you can easily go long or short (i.e., profit from both
rising and falling prices), the relatively low margin requirements, wide range
of available indices and the fact that indices are reshuffled from time to
time, which is ensuring that they stay relevant.

 

When traders
think about stock indices, typically it is the most popular indices that come
to their minds, such as the NASDAQ
100, Dow Jones 30, and S&P 500. The universe of stock indices consists
of many more indices than the extremely popular U.S. indices. In this article,
we will look at three stock indices that are worth watching in the current
market environment.

 

Spotlight on: Nikkei
225    

 

The Nikkei
225 futures contract is particularly popular in Japan, and famous for its
high intraday volatility, while still being highly liquid. The Nikkei 225
consists of the 225 largest and most liquid stocks traded on the Tokyo Stock
Exchange (TSE). It is the leading index for the Japanese stock market and often
seen as the Japanese version of the Dow Jones (i.e., blue chips stocks).

 

The higher
volatility compared to other indices from developed markets and slightly lower
correlation to them make the Nikkei 225 attractive to short-term traders.

 

What is
moving the price of the Nikkei 225? It could be anything from earnings reports
from the constituents to Japanese economic data releases and global events
(such as the pandemic and geopolitical tensions).

 

Looking at
the chart below, we can see that the Nikkei 225 crashed in March 2020 as the
pandemic started to escalate, followed by a sharp rebound and multi-month
rally. However, the bull market ended much earlier than it did in U.S. markets.

 

Chart: Japan
225 CFD (Source: Axi MT4)

 

Spotlight on: DAX 40

 

The DAX
40 (formerly known as DAX 30) is Germany´s most popular stock index, and
widely traded around the globe. It is a popular way for traders to gain
exposure to the German stock market – with Germany being Europe´s largest
economy.

 

The DAX 40
consists of 40 constituents, including some famous blue-chip names such as
Siemens, Deutsche Bank, Bayer, BMW and Mercedes-Benz Group.

 

High
intraday volatility, high liquidity, long trading hours and low spreads make it
a popular product for traders. The focus has increasingly switched to Europe in
recent months amid rising geopolitical tensions and the ECB moving towards its
first rate hike in a long time sooner than initially anticipated. This has led
to increased volatility in European equity markets, which has affected the DAX
40 the most.

 

 

GER40 Chart,
Source: Axi MT4

 

Spotlight on: ASX 200

 

The ASX
200 is a stock market index that consists of the top 200 Australian shares
listed on the Australian Securities Exchange (ASX). The index covers more than
80% of the entire Australian stock market by size. The S&P/ASX 200 was
launched in April 2000 and is priced in AUD (Australian Dollars).

 

The ASX 200
has been getting more attention from traders recently amid rising volatility.
The main reasons are concerns over an economic slowdown in China (Australia´s
biggest trading partner), rising commodity prices and increased fluctuations in
the Australian Dollar amid rising interest rates.

 

AUS200 Chart
– Source: Axi MT4

 

Stay ahead
of the markets and trade your edge with Axi.

 

The
information is not to be construed as a recommendation; or an offer to buy or
sell; or the solicitation of an offer to buy or sell any security, financial
product, or instrument; or to participate in any trading strategy. Readers
should seek their own advice. Reproduction or redistribution of this
information is not permitted.

Consensus estimate +325KPrivate +325KApril +428KUnemployment rate consensus estimate: 3.5% vs 3.6% priorParticipation rate consensus 62.2% priorPrior underemployment U6 prior 7.0%Avg hourly earnings y/y exp +5.2% y/y vs +5.5% priorAvg hourly earnings m/m exp +0.4% vs +0.3% priorAvg weekly hours exp 34.6 vs 34.6 priorHere’s the May jobs story so far:ADP +128K vs +300K expected ISM services employment not yet releasedISM manufacturing employment 49.6 vs 50.9 priorPhilly employment 25.5 vs 41.4 priorEmpire employment 14.0 vs 7.3 priorInitial jobless claims survey week 195K vs 197K expI don’t see this as a particularly important report. A 50 bps hike from the Federal Reserve is baked in and there’s no reasonable number here that could change that. Average hourly earnings is the detail to watch because a sharp rise in that beyond the 5.2% y/y expected could jar the Fed into a more-hawkish stance. We got a hint of that Wednesday from Daly as the talk about going beyond neutral if necessary ramps up.

Bitcoin rose 2.4% to $30.5K in the past 24
hours. Ethereum added 0.2% to $1820. Ether was unexpectedly among the laggards.
Altcoins from the top 10 rose from 1.5% (BNB) to 4.1% (Solana).

Total crypto market capitalisation, according to CoinMarketCap, rose 1.8%
overnight to $1.26 trillion. Bitcoin’s dominance index added 0.2% to 46.3%. The
cryptocurrency fear and greed index was down 3 points to 10 by Friday and
remains in “extreme fear”.

Bitcoin rebounded on Thursday after falling sharply the day before. The
strengthening was helped by a weaker dollar and positive stock indexes. The
local downtrend (former consolidation triangle from May 10) turned into a
support line. For the short term, this is good news. However, it is worth
remembering that this is a fragile structure that could be broken by both a
stronger dollar and a market reaction to labour market news.

Bitcoin has already reached the “bottom” in the current cycle of decline and
will not fall below $25,000, said former BitMEX cryptocurrency exchange CEO,
Arthur Hayes. However, a market trend reversal should be expected when the Fed
stops raising rates.

According to BTC.TOP CEO Jiang Zhuoer, the bearish phase will end in six
months. A possible driver for this could be the Ethereum update, which should
occur between October and December. Another bullish factor will be the US
Federal Reserve’s refusal to hike rates.

According to a Goldman Sachs survey, 6% of global insurance companies have
invested or want to invest in cryptocurrencies. According to the Economist
Impact survey, a growing number of investors see digital currencies as a useful
tool for portfolio diversification.

This article was written by FxPro’s Senior Market Analyst Alex
Kuptsikevich.

Fresh from
picking up two awards for 2022, online trading platform PU Prime has once again
received recognition, this time with the award for World’s Best Online
Broker at the Financial Expo Egypt 2022.

 

Held from
25-26 May in Egypt, the Financial Expo gathered more than 5000 traders, 100
brokers, and 70 speakers from over 30 countries for one of the MENA region’s
largest financial and Forex events. Top brokers got to exhibit their products
and services, while traders got to meet and learn from some of the industry’s
top professionals.

 

Awards given
out at the Financial Expo celebrate the best-in-class achievements of attending
brokers. With a presence in over 120 countries and regions, and top-tier
support in over 18 languages, PU Prime is more than ready to take on the
competitive global brokerage market.

PU Prime is
delighted to continue receiving industry recognition and hopes that its
ceaseless efforts to strive for the best will bring itself, and its stakeholders
to greater heights.

 

Most
importantly, PU Prime would like to express its heartfelt thanks to its
customers – without which none of this would have been possible.

 

About PU
Prime

Established
in 2015, PU Prime is an award-winning online brokerage that services over 120
countries and regions throughout Oceania, Europe, Asia, Africa, and North
America.

The Reserve Bank of Australia meeting is next week:

Tuesday 7 June 2022
Statement is due at 0430 GMT

Via Westpac, they have been in the ’40bp in June‘ camp ahead of this note, no change in forecast:

The RBA is almost certain to raise the cash rate next week. Since the decision to make the first move on May 3 we have consistently argued that the best decision will be to move by 40 basis points. That would eliminate the emergency stimulus from 2020 and send a clear signal that the Board recognises its formidable task to move inflation back within the target band by 2024 and is prepared to act decisively.

That’s in summary from a longer piece.
—
Earlier RBA preview:

the RBA free to hike rates again this month by 25bp

Reserve Bank of Australia Governor Lowe: