By Samir Al Khoury,

United States of America

• The Institute for Supply Management (ISM) Manufacturing Purchasing Managers’ Index (PMI) declined by 48.7 points, which is lower than expectations (49.8) and the previous reading (49.2).

• The construction spending index declined on a monthly basis, recording a contraction of 0.1%, which is lower than expectations (0.2%) and the previous reading (-0.2%).

• The job opportunities index declined, recording 8.059 million, which is lower than expectations (8.370M) and the previous reading (8.355M).

• The index of change in non-agricultural private sector jobs issued by ADP declined, recording 152 thousand jobs, which is a lower percentage than expectations (173K) and the previous reading (188K).

• The non-manufacturing purchasing managers index issued by the Institute for Supply Management (ISM) rose by 53.8 points, which exceeded expectations (51.0) and the previous reading (49.4).

• The trade balance index recorded a deficit of $74.60 billion, which was higher than expectations (-76.20B) but lower than the previous reading (-68.60).

• US crude oil inventories rose, recording 1.233 million barrels, a rate that exceeded expectations (-2.100M) and the previous reading (-4.156M).

• The initial jobless claims index rose to 229K, which exceeded expectations (220K) and the previous reading (221K).

• The Non-Farm Payrolls Report (NFP) index rose, recording 272,000 new jobs, a percentage that exceeded expectations (182K) and the previous reading (165K).

• The unemployment rate rose to 4.0%, which exceeded expectations and the previous reading (3.9%).

• The average hourly earnings index rose on an annual basis, recording 4.1%, which exceeded expectations (3.9%) and the previous reading (4.0%).

Eurozone

• The European Central Bank decided to reduce interest rates for the first time since March 2016, bringing the interest rate on major refinancing operations to the level of 4.25% compared to 4.50%, in line with market expectations that suggested a reduction in interest rates by 25 basis points.

• The Manufacturing PMI recorded a contraction of 47.3 points, which is lower than expectations (47.4) but exceeding the previous reading (45.7).

• The Services Purchasing Managers’ Index declined, recording a growth of 53.2 points, which is lower than expectations and the previous reading (53.3).

• The Producer Price Index recorded a contraction of 5.7%, which is lower than expectations (-5.1%) but exceeds the previous reading (-7.8%).

• Retail sales declined, recording a contraction of 0.5%, which is lower than expectations (-0.2%) and the previous reading (0.7%).

• The GDP index recorded a quarterly growth of 0.3%, which is in line with expectations but lower than the previous reading (0.0%).

United Kingdom

• The Manufacturing Purchasing Managers’ Index rose, recording a growth of 51.3 points, which exceeded expectations (50.9) and the previous reading (50.0).

• The services PMI recorded a growth of 52.9 points, which is in line with expectations but lower than the previous reading (55.0).

• The Construction Purchasing Managers’ Index rose, registering a growth of 54.7 points, which exceeded expectations (52.5) ​​and the previous reading (53.0).

Canada

• The Central Bank of Canada decided to reduce interest rates by 25 basis points from 5.0% to 4.75%.

• The rate of change in employment recorded 26.7 thousand new jobs, which is a percentage that exceeded expectations (24.8 K) but lower than the previous reading (90.4 K).

• The unemployment rate rose to 6.2%, which was in line with expectations but exceeded the previous reading (6.1%).

• The Ivey Purchasing Managers’ Index declined, registering an increase of 59.1 points, which is a lower percentage than the previous reading (65.7).

Switzerland

• The Consumer Price Index recorded an annual rate of 1.4%, which is consistent with the previous reading.

Australia

• The manufacturing purchasing managers’ index rose, recording a contraction of 49.7 points, which is higher than the previous reading (49.6).

• Retail sales recorded a monthly growth of 0.1%, which was in line with expectations but lower than the previous reading (-0.4%).

• The Services Purchasing Managers’ Index declined, recording a growth of 52.5 points, which is lower than expectations (53.1) and the previous reading (53.6).

• The GDP index declined on an annual basis in the first quarter of this year, recording a growth of 1.1%, which is lower than expectations (1.2%) and the previous reading (1.6%).

• The trade balance rose, recording a surplus of 6.548 billion Australian dollars, which exceeded expectations (5.370B) and the previous reading (4.841B).

Japan

• The Manufacturing Purchasing Managers’ Index (PMI) declined, registering a contraction of 49.5 points, which is lower than expectations (50.5) and the previous reading (50.4).

• The non-manufacturing PMI declined, registering a growth of 51.1 points, which is lower than expectations (51.5) and the previous reading (51.2).

China

• The Caixin Services PMI recorded a growth of 54.0 points, which exceeded expectations and the previous reading (52.5).

• The export index rose, recording a growth of 7.6%, which exceeded expectations (6.0%) and the previous reading (1.5%).

• The import index declined, recording a growth of 1.8%, which is lower than expectations (4.2%) and the previous reading (8.4%).

• Foreign exchange reserves rose to $3.232 trillion, which exceeded expectations (3.210T) and the previous reading (3.201T).

The most important events of this week

This week, financial markets are eagerly awaiting the release of several key economic indicators:

• Japan’s GDP index will be released today.

• On Tuesday, the markets await the income rates, including bonuses and unemployment, in Britain.

• As for Wednesday, the markets are awaiting the interest decision issued by the Federal Reserve, amid expectations that it will keep interest rates unchanged at the levels of 5.25 and 5.50%. Attention will turn to the dot plot, that is, the updated estimates of the members of the Monetary Policy Committee regarding the path of interest, growth, and inflation, in addition to to the speech and tone of Federal Reserve Chairman Jerome Powell on the issue of the interest rate path during the coming period, especially on the timing of the first rate cut.

It issues the consumer and producer price indices in China, the GDP and industrial production indices in Britain, in addition to the consumer price indices and the US crude oil inventories in the United States of America.

• Regarding Thursday, the markets are awaiting the rates of change in employment and unemployment in Australia, the producer price index in Switzerland, new loans in China, industrial production in the euro zone, and the indicators of initial jobless claims and producer prices in the United States of America.

• Finally, the markets are awaiting the interest rate decision issued by the Bank of Japan, amid expectations that it will keep interest rates unchanged at the level of 0.1%.

The industrial production index in Japan, the trade balance in the euro zone, and the Michigan consumer confidence index in the United States of America are issued.

Technical Analysis:

EUR/USD: 

If the euro against the dollar breaks the pivot point of 1.0840, it may potentially target and test the support levels of 1.0793, 1.0740, and 1.0692. Conversely, if it surpasses the pivot point, it is likely to test resistance levels of 1.0894, 1.0941, and 1.0995.

GBP/USD: 

The pound against the dollar, if it breaks the pivot point of 1.2739, has the potential to test the support levels of 1.2679, 1.2620, and 1.2560. However, if it exceeds the pivot point, it may test resistance levels of 1.2800, 1.2860, and 1.2919.

USD/JPY: 

If the pivot point of 157.10 is broken for the dollar against the yen, there is a possibility that it will target the support levels 156.49, 155.75, and 155.15. But if it exceeds the pivot point, it is likely to target the resistance levels 157.83, 158.44, and 159.17.

GOLD: 

If the pivot point of 2345 is broken for gold, there is a possibility that it will target the support levels 2283, 2242, and 2181. But if it exceeds the pivot point, it is likely to target the resistance levels 2386, 2447, and 2488.

BRENT CRUDE OIL:

If the pivot point of 79.34 for crude oil is broken, there is a possibility that it will target the support levels of 77.03, 74.45 and 72.14. If it exceeds the pivot point, it is likely to target the resistance levels 81.92, 84.23, and 86.81.

US30:

If the pivot point of 38,788 for the Dow is broken, there is a possibility that it will target the support levels 38,402, 37,947 and 37,561. If it exceeds the pivot point, it is likely to target the resistance levels 39,243, 39,629, and 40,084.

Please note that this analysis is provided for informational purposes only and should not be considered as investment advice.

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