US stocks finished near record highs on Wednesday led by rising oil. The dollar weakened to one month low as investors revised downward their expectations of a rate hike in June after the dovish comments by Federal Reserve Chair Janet Yellen. The live dollar index data indicate the ICE US Dollar Index, a measure of the dollar’s value against a basket of six major currencies, fell 0.3% to 93.535. The Dow Jones Industrial Average advanced 0.4% to 18005.05. UnitedHealth and Caterpillar contributed the most to blue chip index’s rise with 2.5% and 1.7% gains respectively while DuPont and Verizon led the decliners down 0.5% and 0.4% respectively. The S&P 500 closed 0.3% higher at 2119.12, led by materials and industrial shares. The dovish comments of Janet Yellen supported investors’ risk appetite implying little likelihood of a rate hike at June policy meeting as the Fed chair omitted any reference to a rate hike timetable. In other economic news, the number of open jobs in April hit record high. Today at 14:30 CET Initial Jobless Claims and Continuing Claims will be released in US. The tentative outlook is negative. At 16:00 CET April wholesale inventories will be published. The tentative outlook is positive for dollar. At 16:30 CET Natural Gas Storage Change will be released by the Energy Information Agency.
European stocks retreated on Wednesday. The euro continued strengthening against the dollar trading at $1.1396 late Wednesday in New York, compared with $1.1356 late Tuesday. The Stoxx Europe 600 fell 0.5%. Energy and utility shares outperformed, Eon and RWE rallied 3.5% and 2.8% respectively. Investor confidence was undermined by the world growth outlook downgrade by the World Bank. The World Bank revised its 2016 global growth estimate downward to 2.4% from a previous estimate of 2.9%. The European Central Bank started purchasing utility, insurance and telecom bonds as it launched its program of purchases of investment-grade corporate bonds. German DAX 30 stock index fell 0.7% to 10217.03. France’s CAC 40 lost 0.6% and UK’s FTSE 100 closed up 0.3% helped by advancing oil. In other economic news UK industrial production in April rose at the fastest monthly pace in nearly four years No important economic data are expected today in euro-zone. At 10:30 CET today April trade balance will be published in UK. The tentative outlook is positive for Pound.
Asian stocks are retreating today as investors weigh the significance of disappointing US May jobs report for US and global economic outlook and refrained from making big bets ahead of major events like UK’s referendum later in June over whether to remain in the European Union. Nikkei fell 1.0% to 16668.41 today as stronger yen hurt exporters’ profit outlook and bank shares tumbled with falling bond yields. Financial markets in China are closed for holidays.
The Reserve Bank of New Zealand unexpectedly left the interest rates unchanged, resulting in a 1.7% rally in the New Zealand dollar to a one-year high of $0.7148.
Oil futures prices are extending gains today after closing at 2016 highs on Wednesday on continued supply disruptions, US crude stock drawdown and weaker dollar. August Brent crude rose 2.1% to $52.51 a barrel on London’s ICE Futures exchange yesterday as data from the US Energy Information Administration showed US crude inventories last week fell by 3.23 million barrels to 532.5 million barrels.