By Deepta Bolaky
 @DeeptaGOMarkets

Equity Markets

Wall Street stays in the green lifted by growing expectations of an interest rate cut by the Fed. The ADP employment change showed only the addition of 27K jobs compares to a 180k forecasted. The idea of more weakness in the economy is supporting a July rate cut.

• The Dow Jones Industrial Average and S&P500 rose by 0.8%.
• The Nasdaq Composite finished higher by 0.6%.

Risk sentiment was somewhat buoyed on the signs that Trump administration is keen to find a solution to avoid the tariffs on Mexican goods. However, as of writing, we note that the negotiations on Wednesday concluded without a deal on immigration, and talks are expected to resume on Thursday.

Currency Markets

The attention was on the US economic calendar with mixed economic data. Major currencies initially edged higher against the greenback on the dismal ADP employment report. The US private jobs sector added only a mere 27k which was the worst report in years fuelling expectations of an interest rate cut.

However, the upbeat ISM Non-Manufacturing PMI and optimism from Mexico-US talks helped the US dollar to reverse losses.

Source: Bloomberg Terminal

The Mexican Peso was at the centre of attention as the start of the talks in Washington on Wednesday helped the currency to recover from the multi-months low.

As of writing, the momentum has changed as President Trump reported no deal had been reached and that talks will resume on Thursday. The Peso sank and is expected to remain dampened until the next statement by the White House.

Commodities Market

The rout in oil prices persists amid the geopolitical tensions and worries on global growth. Another bearish report from Energy Information Administration (EIA), which showed crude oil inventories increased by 6.8 million barrels from the previous week prompted fresh selling.

US Crude oil fell into bear territory having lost more than 20% after April highs above $66. WTI is currently trading at $51.62 while Brent Crude oil is trading in the vicinity of $60.21.

USOUSD (Daily Chart)

Source: GO MT4

The Fed is putting a bid on Gold along with a combination of global headwinds, which is forcing investors to seek safety. As the US-Mexico talks wind down, the lack of positive news dampened the recent optimism of a deal. We expect money to keep flowing into safe-havens if US-Mexico failed to make a deal on Thursday. XAUUSD tested a high of $1,344.16  before retreating to $1,329.74.

XAUUSD (Daily Chart)

Source: Bloomberg Terminal

Cryptocurrencies

The retracement in the cryptocurrencies paused on Wednesday. Bitcoin is currently trading around $7,700 mark. The recent revival of the crypto market sent a signal that investors might see digital currencies as a safe-haven investment. Even though the correlation of Bitcoin with other the markets are still unclear, it will be worth analysing its movement in that regard.

BTCUSD (Hourly Chart)

Source: GO MT4

Key Upcoming Events Ahead

Friday, 07 June 2019 Indicative Index Dividends Dividends are in Points
ASX200	WS30	US500	US2000	NDX100	CAC40	STOXX50
0	5.561	0.272	0.134	0.044	0.36	0
ESP35	ITA40	FTSE100	DAX30	HK50	JP225	INDIA50
1.183	0	0	0	0	0	0

Disclaimer: Articles and videos from GO Markets analysts are based on their independent analysis. Views expressed are of their own and of a ‘general’ nature. Advice (if any) are not based on the reader’s personal objectives, financial situation or needs.  Readers should, therefore, consider how appropriate the advice (if any) is to their objectives, financial situation and needs, before acting on the advice.