- Wall Street is to open higher today
- Jobless Claims data rises more than expected
- ECB hikes rates by 25 bp and suggests it is far from the end of the cycle
Wall Street opened today 0.5% higher near 4,400 points. This comes as US retail sales unexpectedly rose in May, demonstrating a resilient consumer demand despite mounting economic challenges. The market's response reflects the balance between the positive signal of strong consumer spending and the potential implications for inflation and monetary policy.
Jobless claims figures suggest a softer labor market than what is indicated by headline data on payrolls, the unemployment rate, and job openings. Seasonally-adjusted initial unemployment claims held constant at 262k for the week ended June 10, with the four-week moving average rising to nearly 249k, the highest level since November 2021. Despite these figures, the labor market softening is happening too gradually to put the Federal Reserve at ease.
Today, the ECB decided to raise the interest rates by 25 basis points. The ECB's decision was made with a very broad consensus of ECB members, reflecting a unified approach to tackling inflation. ECB also signaled that its interest rate hiking campaign isn't over yet. ECB President Christine Lagarde stated that the bank is "very likely" to raise again in July and is not thinking about pausing.
US500 index is currently trading at 4,430 points, marking a 1.3% increase today. It's important to note that a CFD rollover occurred yesterday, which explains the gap observed on the XTB chart. The index has shown strong bullish momentum, breaking through significant resistance levels at 4,300 and 4,400 points. This upward trend has been almost exponential, following several days of decent gains.
The break above these resistance levels suggests a strong bullish sentiment among investors, and the index could potentially continue its upward trajectory. However, the almost exponential move might also indicate overbought conditions, and a short-term pullback or consolidation could occur before the index continues its upward trend.
Company News:
- Domino’s Pizza (DPZ.US) rises 6.67% after Stifel upgrades the restaurant chain to buy from hold, predicting delivery sales to stabilize over the next 12 months, while carryout sales grow to new record highs.
- Verve Therapeutics (VERV.US) rises 7.7% after the company announced an exclusive research collaboration with Eli Lilly to advance its preclinical gene editing program targeting lipoprotein.
- Esperion Therapeutics (ESPR.US) surges 10% after BofA double-upgrades its rating on the medical device company, citing greater confidence in reaching a settlement with partner Daiichi Sankyo Europe.
- Cyptocurrency-related stocks fall in US premarket trading, tracking a dip in Bitcoin as worries re-emerge over the sector’s risks following news that two South Korea-linked crypto platforms have halted withdrawals.
- Coinbase (COIN.US) shares fall 2.3%, Riot Platforms (RIOT.US) -3.7%, Marathon Digital Holdings (MARA.US) -4%.
- Nvidia (NVDA.US) falls 1.4% putting the stock on course to snap a five-day winning streak that has boosted the market value of the world’s most valuable chip company beyond $1 trillion.
