A strong US labour market figure , unemployment claims dropped to 190k when 196k was expected, in combination with a record high Core CPI figure out of Europe saw the US equity session get off to a rocky start as bond yields soared.

That all changed later in the session as a Bloomberg headline hit with comments from Fed member Bostic.

Which saw an instant reaction in stocks which rallied steeply, sending the Nasdaq back above it’s critical 200 day moving average support level.

Interestingly, a pause  in rates in July was already priced in by Fed fund futures, and Bostic isn’t even a voting member which I think shows how desperate the bulls seem to be for any perceived “dovish” tone from the Fed to kickstart another up move in equities.

In the Eurozone, CPI figures came out hotter than expected, with the Core reading hitting a record high, this sent terminal ECB rate expectations to 4.00% for the first time. The reaction in the Euro was muted though, these higher readings seemingly did not surprise FX traders after hot German, Spanish and French CPI figures already released earlier in the week.

The EURUSD briefly rallied before resuming its downtrend, breaking through the 1.06 level.

Gold limped lower in the face of a stronger USD , still holding below it’s 23.6 Fibonacci retracement level which has proven to be stiff resistance since mid February.

In major economic announcement coming up, only the US ISM Services PMI looks likely to move the markets. As any figure recently that has anything to do with inflation and business activity, this one will be closely watched.