Market News Summary
European stock indices ended the trading day on a downward trend on Wednesday, following renewed concerns over the global banking sector.
The Stoxx 600 index closed down by 0.8%, with health care stocks experiencing a decline of 2.5%, industrials down 1.4%, and household goods stocks falling by 1.2%. Meanwhile, London-listed Standard Chartered Bank’s earnings before tax increased by 21%, beating expectations, and its stock rose slightly. The European banking sector, which had previously seen losses, trimmed down and closed with a 0.2% decline.
In the US, the House of Representatives narrowly passed a bill aimed at raising the government’s $31.4 trillion debt ceiling. The bill includes sweeping spending cuts over the next decade, but is not expected to pass the Senate, and even if it does, President Joe Biden is likely to veto it using his veto power. Despite this, the bill’s approval by 217 deputies and rejection by 215, with most of the support coming from the Republican Party, represents a victory for the Speaker of the House of Representatives, Kevin McCarthy, and has caused some unease among investors and markets.
Dollar index (USDX)
The US dollar index decreased by 0.41% to 101.172 against a basket of foreign currencies, following a 0.5% rise in trading last Tuesday.
The major US market indices closed sharply lower yesterday, driven by the decline of First Bank’s stock, which fell by approximately 40%, renewing fears of a US bank crisis.
Pivot Point: 101.15
| Support Level | Resistance Level |
| 100.70 | 101.60 |
| 100.25 | 102.05 |
| 99.40 | 102.95 |
Spot Gold (XAUUSD)
On Thursday, gold prices saw an increase as the US dollar weakened in anticipation of a series of US economic data to be released ahead of the upcoming Fed’s monetary policy meeting.
Spot gold transactions went up by 0.4% and reached $1996.50 per ounce, while US gold futures saw a rise of 0.5% and reached $2005.20.
Pivot Point: 1993
| Support Level | Resistance Level |
| 1978 | 2004 |
| 1967 | 2019 |
| 1941 | 2045 |
Dow Jones Index (DJ30ft – US30)
The Dow Jones index recorded a decline of 0.7%, or approximately 228 points, marking its second consecutive session of retreat and losing all gains achieved in the month of April.
Following Wednesday’s disappointing capital goods data and weak UPS results on Tuesday, the transportation sector – which is sensitive to economic fluctuations – also suffered a decline for the second consecutive day.
First Republic Bank shares hit a new record low, falling by 30%, after reports revealed that the US government was not willing to coordinate a bailout of the bank, despite it reporting more than $100 billion in deposits in the first quarter.
Pivot Point: 33515
| Support Level | Resistance Level |
| 33270 | 33680 |
| 33090 | 33925 |
| 32850 | 34340 |
US Crude (USOUSD)
On Wednesday, oil prices plunged by approximately 4%, extending the steep declines from the prior session, as a report revealed that US crude inventories dropped more than projected. This comes as concerns about a potential recession in the world’s largest economy continue to mount.
Brent crude settled at $77.69 a barrel, losing $3.08, or 3.8%. West Texas Intermediate crude recorded $74.30 a barrel, down $2.77, or 3.6%.
Pivot Point: 75.40
| Support Level | Resistance Level |
| 72.90 | 76.80 |
| 71.60 | 79.30 |
| 69.50 | 83.15 |
