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The risk-on vibes, commodities rally, and Greenback weakness allowed the higher-yielding Aussie and Kiwi to rake in even more gains during the morning London.

  • Spanish unemployment change: -83.7K vs. -105.7K expected, -86.7K previous
  • Spanish consumer confidence: 97.7 vs. 99.0 previous
  • Sentix Euro Zone investor confidence: 9.3 vs. 19.0 expected, 19.2 previous
  • U.K. construction PMI: 52.5 vs. 52.0 expected, 52.5 previous
  • Euro Zone PPI m/m: 0.0% vs. 0.2% expected, 0.1% previous

Major Events/Reports:

U.K. construction PMI

Markit released the U.K.’s latest contruction PMI report, which revealed that the headline reading was steady at 52.5 in May.

This is good news because the consensus was for the reading to ease slightly to 52.0. Also, the reading is still above the 50.0 stagnation level, which means that the construction sector continues to grow at a moderate pace.

Even so, commentary from Markit weren’t too optimistic. New work orders, for one, “slipped back into decline during May.” And survey respondents “blamed political and economic uncertainty, subdued retail sector conditions and fragile business confidence as key causes of weaker demand for construction projects.”

Business confidence is another since it “slumped to a seven-month low in May.” And that’s not the end of it since “job creation softened to a four-month low in the latest survey period.”

But on a more upbeat note, the “rate of input price inflation was the steepest registered since February,” which will likely help to push CPI higher down the road.

Oil slides as other commodities climb

Most commodities were on the rise during today’s morning London session. Oil was not one of them, though, since oil benchmarks were broadly in the red.

Commodities were likely underpinned due to the Greenback’s relative weakness, which makes globally-traded commodities relatively cheaper. And for reference, the U.S. dollar index was down by 0.42% to 93.76 for the day by the end of the session.

As to why oil prices were under pressure, market analysts are still blaming that on the rise in U.S. oil output and concern that OPEC Members may also decide to raise their output during this month’s OPEC meeting in Vienna.

Precious metals were in positive territory despite the risk-on vibes.

  • Gold was up by 0.04% to $1,299.80 per troy ounce
  • Silver was up by 0.15% to $16.465 per troy ounce

Base metals were actually mixed, but most were in the green.

  • Copper was up by 0.50% to $3.114 per pound
  • Zinc was up by 0.04% to $3,089.00 per dry metric ton

Oil benchmarks were still down in the dumps.

  • U.S. WTI crude oil was down by 0.68% to $65.36 per barrel
  • Brent crude oil was down by 1.28% to $75.81 per barrel

Some risk-taking to start the week

Europe is starting the new trading week on a rather upbeat mood since most of the major European equity indices opened higher and then continued to reach for new intraday highs as the session progressed.

And market analysts say that the risk-on vibes in Europe were due to fading political uncertainty in Spain and Italy, as well as deal-making activity in the financial sector, which helped to lift overall sentiment.

  • The pan-European FTSEurofirst 300 was up by 0.53% to 1,521.88
  • Germany’s DAX was up by 0.31% to 12,763.40
  • The blue-chip Euro Stoxx 50 was up by 0.82% to 3,476.85

The risk-friendly vibes in Europe also helped to push U.S. equity futures higher. And that, in turn, implies that the risk-on vibes may carry over into the upcoming U.S. session.

  • S&P 500 futures were up by 0.38% to 2,744.25
  • Nasdaq futures were up by 0.46% to 7,115.25

Major Market Mover(s):


The risk-on vibes, commodities rally, and Greenback weakness very likely helped to sustain demand for the higher-yielding Aussie and Kiwi.

And while the Aussie is currently the best-performing currency of the day, thanks to positive Australian data from earlier, it was the Kiwi that actually dominated during the morning London session.

NZD/USD was up by 40 pips (+0.57% ) to0.7044, NZD/CAD was up by 34 pips (+0.38%) to 0.9096, NZD/JPY was up by 33 pips (+0.43%) to 77.11

AUD/USD was up by 32 pips (+0.42%) to 0.7660, AUD/JPY was up by 25 pips (+0.31%) to 83.84, AUD/CAD was up by 34 pips (+0.35%) to 0.9891


The Greenback was broadly in retreat during the morning London session, even though there weren’t really any apparent catalysts. And market analysts were only pointing out the obvious when they noted that the Greenback was weak despite last week’s better-than-expected NFP report.

However, it’s possible that some traders are just wary if being too bullish on the Greenback because of trade-related fears, given that the trade talks between China and the U.S. didn’t really pan out over the weekend and, as noted in last week’s USD recap, the U.S. will push through with its planned tariffs on aluminum and steel imported from the E.U., Canada, and Mexico, which prompted Canada and Mexico to announce retaliatory tariffs against the U.S.

USD/JPY was down by 19 pips (-0.18%) to 109.45, USD/CHF was down by 42 pips (-0.43%) to 0.9833, USD/CAD was down by 26 pips (-0.21%) to 1.2912

Watch Out For:

  • 2:00 pm GMT: U.S. factory orders (-0.5% expected vs. 1.6% previous)
  • 5:00 pm GMT: BOE MPC Member Silvana Tenreyro will speak