Non-Farm Payroll look-ahead/ ISM Manufacturing/yield curve
By David Morrison
This Friday sees the release of US Non-Farm Payrolls for May. We’ll also get an update on the Unemployment Rate and Average Hourly Earnings.
Non-Farms are expected to show gains of 190,000 which would be a modest, but welcome, improvement from April’s disappointing increase of just 164,000 – well below the 190,000 expected then as well.
The last two months have fallen short of consensus forecasts so another miss in the absence of upside revisions would rattle markets and lead to a pull-back in the US dollar.
The Unemployment Rate is forecast to remain steady at 3.9% – unchanged from April and still at 17 and-a-half-year lows.
Later on Friday afternoon we have the US ISM Manufacturing PMI. This is a forward-looking indicator and has fallen sharply since February this year when it came in at 60.8 against 57.3 in April.
It is expected to recover to 58.2 but another weak number would lead analysts to downgrade their forecasts to 2nd quarter GDP. If so, expect market to dial down on Fed hawkishness. Bear in mind that that higher inflation with lower growth means stagflation. Bad for bonds and equities.
Apple chart: Three reasons to be bullish , says technician
By Keris Lahiff | @kerisalison
Apple has been trading sideways since hitting record highs earlier this month.
- The stock’s breakout above March resistance, it broke higher both on an absolute and relative basis. That’s a sign of relative strength.
- Its relative strength index, a measure of momentum, has leveled off since hitting a year-to-date peak nearly three weeks ago. Its RSI of 61.7 is below the 70 level typically indicative of overbought conditions.
- The recent price consolidation within the confines of the two yellow trendlines has formed a bullish pennant pattern. This pattern is indicative of trend continuance. A clear break above this pattern will confirm it and is a good entry point.
Japan shares higher at close of trade; Nikkei 225 up 0.83%
Japan equities were higher at the close on Thursday, as gains in the Mining, Gas and Water and Communication sectors propelled shares higher.
The 225-issue Nikkei average rose 183.30 points, or 0.83 percent, to end at 22,201.82 on the Tokyo Stock Exchange after plunging 339.91 points Wednesday.
EUR/USD Forecast: Italian inspiration and oily inflation are worth 200 pips, but is there more?
By Yohay Elam
- The EUR/USD extends its recovery and is already 200 pips above the lows.
- Upbeat economic data and fewer fears about Italy help the pair recover.
- The EUR/USD exited the oversold territory and broke above downtrend resistance
The EUR/USD is trading above 1.1700, some 200 pips off the 10-month low of 1.1510 seen on Tuesday. A positive twist in Italy’s political drama is the primary upwards driver.
Another reason for the rise of the EUR/USD has a better basis. Economic data has finally picked up. The winter “moderation” lasted for a long time. A pick up in German Retail Sales and also in inflation figures provide some relief for the European Central Bank.
Tesla’s Stock Poised To Rebound 11% Short Term
By Michael Kramer
Tesla Inc. (TSLA) shares have plunged more than 26 percent since September amid huge cash losses and production delays of its all-electric four-door sedan, the Model 3. That has strained the loyalty of even Tesla’s most ardent investors. But now, they may get a reprieve of sorts. Technical charts suggest Tesla’s shares are poised for a short-term bounce, rising by as much as 11% back to approximately $310.
It’s not just the technical charts. Analysts have been growing slightly more bullish on the stock as well, raising their earnings and revenue estimates for the coming year. Investors are waiting anxiously to learn whether weekly production rates for the Model 3 are on track, and the stock could get a boost if the news is good. The company will make an announcement after the end of the second quarter.