The Non-farm Payrolls report has given risk appetite a brief boost but that could quickly be forgotten this week as focus turns back on global growth and Brexit. This comes as traders look to a raft of economic data from China and the possibility of a rate cut from the Bank of England. The FOMC minutes implied there was a real concern on the committee over the deterioration in the labor market. Whilst Friday’s strong beat of expectations will have helped to ease some of their fears the committee will also be mindful that this is before the impact of Brexit has really been factored in. The lack of significant movement on the US interest rate futures reflects this. So this week the market will turn to announcements that will focus the mind of traders back on global growth (with a series of Chinese economic data) and Brexit (with the Bank of England monetary policy). A rate cut is in the balance for the Monetary Policy Committee (although I still think that they are far more likely to move in August when they have more data and projections at hand). The impact on the market could be to send investors back towards safe havens once more and a new leg lower in sterling.
We take a look at the current outlook of forex and a focus on sterling and the US dollar with the safe havens still preferred. There is also a technical analysis of Euro/Dollar and also Sterling/Dollar. With some significantly varied impacts of Brexit on the major equity indices we take a look at the current outlook of the markets. We also undertake a technical analysis of the S&P 500 and FTSE 100. Then we finish with a look at the outlook on the key commodities and bond markets. How have the technicals on gold and Brent Crude oil also been impacted by the moves in the past week and what is the outlook now going forward?