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US dollar rate ends higher

US stocks edged lower on Friday for a second straight day as the ICE US dollar index advanced. Non-Farm Employment Change in May outperformed the outlook. Now most investors expect the Fed to carry out the first rate hike in September 2015. This will load more credit burden on American corporations. Stock indices fell for a second consecutive week: the Dow slipped 0.9%, S&P 500 was down 0.7% and Nasdaq remained almost unchanged. Zumiez Co cut the profit forecast and the company’s shares tumbled 19.3% on Friday. The trading volume on US stock exchanges was approx 6.3 billion shares, at the level of 5-day average. Significant US statistics is not expected today.

European markets sagged today for the third day in a row on corporate and political negative news. This morning strong macroeconomic data has been released in Germany. It bolstered a bit the euro. Agricultural company Syngenta rejected the purchase offer from Monsanto for the second time and the company’s shares dropped 1.3%. Greece failed to pay the IMF on Friday and became the first country to do that since mid 80s of the last century. The IMF agreed that the entire Greek debt repayment due this month (1.2 billion euro) must be transferred the last day of June. There will be no more meaningful economic reports in the euro zone for today.

Nikkei has retreated today still being traded in a range. The dollar rose against the Japanese yen to the 13-year high. Thus, they moved in tandem with the global trend. At the same time investors are ignoring the good performance of the Japanese economy. This morning the final Q1 GDP has been revised upward and Trade Balance in April has been reduced. However, some market participants were unhappy with the GDP growth as this greatly reduces the chances of further monetary stimulus carried out by the Bank of Japan. Tomorrow at 7-00 СЕТ Consumer Confidence and Machine Tool Orders in May will be released in Japan. The outlook is positive.

Brent

Crude oil prices upped slightly as Saudi Arabia shot down scud missile fired from Yemen. The number of operating US oil rigs dipped from 875 to 868 over the week. OPEC kept production levels at 30 million barrels a day. Iran’s Oil Minister said that the current oil prices were unfairly low. In his opinion, it should be $75 per barrel. According to the US Commodity Futures Trading Commission, hedge funds have increased the number of net long positions on oil over the week.

Gold prices dipped on Friday over the concerns of the Fed rate hike. The stockpile of SPDR Gold Trust is reported to fell to the lowest level since mid-January and currently amounts to 708.7 tons. According to U.S. Commodity Futures Trading Commission, net long positions on copper, gold and silver over the week has been reduced. Today gold prices are rebounding because of a possible strike in the gold mines of South Africa, as reported by South Africa's Association of Mineworkers and Construction Union.

US Department of Agriculture will publish World Agricultural Supply and Demand Estimates on Wednesday. It may affect cotton and grain futures prices.


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