Global equities retreated and benchmark U.S. Treasury yields eased off two-month highs on Tuesday as talks over the U.S. debt ceiling continued without resolution.
Global equities retreated and benchmark U.S. Treasury yields eased off two-month highs on Tuesday as talks over the U.S. debt ceiling continued without resolution.
Hawkish comments from Federal Reserve officials about the possibility of further rate hikes sent the U.S. dollar to a two-month high.
Oil prices rose on forecasts for a tighter gasoline market and a warning from the Saudi energy minister to speculators that raised the prospect of further OPEC+ output cuts.
Commodities
Oil prices rose by more than a dollar a barrel and extended gains to about 2% in post-settlement trade, after figures from the API showed a large draw in crude and gasoline last week, according to market sources.
Production cuts by some OPEC+ members take effect this month. Fears of a supply squeeze mounted after Saudi Arabia's energy minister said he would keep short sellers - those betting that prices will fall - "ouching" and told them to "watch out".
The comments could mean the Organization of Petroleum Exporting Countries and allies including Russia will consider further output cuts at a meeting on June 4, said OANDA analyst Craig Erlam.
Brent crude prices need to rise above $77.50 a barrel to signal a sentiment shift, he added.
Forex
The greenback ose to 138.91 against the Japanese yen, the highest since Nov. 30, before falling back to 138.57.
Traders have ramped up bets that the Fed funds rate will stay elevated, with markets pricing in almost a 30% chance of a rate hike in June and the Fed funds rate seen at about 4.75% in December.
Data on Tuesday showed that sales of new U.S. single-family homes jumped to a 13-month high in April.
S&P Global's flash U.S. Composite PMI Output Index, which tracks the manufacturing and services sectors, also climbed to a reading of 54.5 this month, the highest level since April 2022.
Global equities rose on Thursday after the U.S. House of Representatives passed a bill to raise the federal debt ceiling, while U.S. Treasury yields fell as data reflected a cooling labor market.
2023-06-02U.S. employers boosted hiring in April while raising wages for workers, pointing to sustained labor market strength. NFP are expected to rise by 190,000 in May, a cooling of the surprise gain of 253,000 jobs created in April.
2023-06-01Global equities and U.S. Treasury yields were lower on Wednesday as risk-off sentiment dominated markets, with investors focused on a vote in Congress on raising the U.S. debt ceiling.
2023-06-01