Forex News
ING commodities strategists Warren Patterson and Ewa Manthey report a notable decline in global Aluminium production in April, driven largely by sharp cuts in Gulf output linked to the Iran conflict. While China’s production dipped month-on-month, it remains slightly higher year-on-year, with alumina supply diversion from the Middle East helping to cushion regional disruptions and support near-term Chinese output.
Global production pressured by Iran conflict
"Data from the International Aluminium Institute (IAI) show that the average daily global primary aluminium output declined to 197.4kt in April."
"Total monthly production for the metal fell 5.3% month-on-month (-2% year-on-year) to 5.92mt last month, reflecting reduced output across major producing regions."
"China’s aluminium production fell 3% month-on-month to 3.7mt in April, while year-to-date output stood at 14.7mt, up 1.6% year-on-year."
"Chinese smelters continue to benefit from alumina supply diversion away from the Middle East, which could support near-term production growth and mitigate regional supply disruptions linked to geopolitical tensions."
"Gulf region production dropped more sharply, down 29% MoM and 34.6% YoY to 330kt, its lowest level since November 2013."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- Dow Jones futures fall as risk aversion grows after Trump threatened military action within days if Iran rejects his terms.
- FOMC April Meeting Minutes indicated that the Fed may raise interest rates if inflation stays stubbornly above their 2% target.
- NVIDIA reported record Q1 revenue of $81.62 billion, while Intuit posted strong Q3 revenue of $8.6 billion.
Dow Jones futures fall 0.22% below 50,000 during European hours ahead of the United States (US) regular opening on Thursday. Meanwhile, the S&P 500 decline 0.27% to near 7,430, and the Nasdaq 100 futures plunge 0.42% toward 29,250.
US stock futures move lower as traders adopt caution on increased risk aversion due to United States (US)-Iran uncertainty and hawkish Federal Reserve (Fed) monetary policy signals. US President Donald Trump stated that negotiations with Iran were in their final stages. However, Trump reiterated to resume military actions within days if Iran rejects his terms.
The Federal Open Market Committee (FOMC) Minutes for the April meeting, released on Wednesday, indicate that a majority of Federal Reserve (Fed) officials warned that the central bank would likely need to consider raising interest rates if inflation remains persistently above their 2% target. The minutes underscored deepening concerns within the Fed regarding inflation risks driven by the ongoing geopolitical conflict.
Wall Street posted solid gains on Wednesday, driven by falling oil prices and lower Treasury yields following comments from President Trump. The major indices rallied across the board, with the Nasdaq 100 leading the advance by climbing 1.54%, followed closely by the Dow Jones rising 1.31% and the S&P 500 advancing 1.08%.
NVIDIA reported a record-breaking first quarter, generating $81.62 billion in revenue and $58.32 billion in net income, fueled by relentless demand for its AI chips. In tandem with these stellar results, the company raised its dividend and announced a massive $80 billion stock buyback plan. Despite the strong financials, shares dipped slightly in extended trading as investors exercised caution regarding forward guidance and rising market competition.
Intuit Inc. delivered strong third-quarter results, posting $8.6 billion in revenue, a 10% year-over-year increase, and subsequently raising its full-year guidance. However, the positive financial news was contrasted by the announcement of a 17% workforce reduction. Affecting roughly 3,000 positions, the layoffs are part of a broader strategic pivot toward AI integration and enhanced operational efficiency.
Analog Devices, Inc. achieved a record second quarter, reporting $3.62 billion in revenue, which marks a significant 37% increase year-over-year. To further capitalize on market momentum, the company also announced a $1.5 billion acquisition of Empower Semiconductor, a strategic move designed to bolster its AI infrastructure capabilities.
Looking ahead at upcoming retail and industrial earnings, Walmart is poised to report strong fiscal first-quarter results, with analysts forecasting a 3.85% increase in overall same-store sales and 4% growth in U.S. comps. Conversely, Deere & Company is preparing to release its second-quarter report amid tougher market conditions, with expectations pointing toward a 12.5% year-over-year decline in earnings per share.
Dow Jones FAQs
The Dow Jones Industrial Average, one of the oldest stock market indices in the world, is compiled of the 30 most traded stocks in the US. The index is price-weighted rather than weighted by capitalization. It is calculated by summing the prices of the constituent stocks and dividing them by a factor, currently 0.152. The index was founded by Charles Dow, who also founded the Wall Street Journal. In later years it has been criticized for not being broadly representative enough because it only tracks 30 conglomerates, unlike broader indices such as the S&P 500.
Many different factors drive the Dow Jones Industrial Average (DJIA). The aggregate performance of the component companies revealed in quarterly company earnings reports is the main one. US and global macroeconomic data also contributes as it impacts on investor sentiment. The level of interest rates, set by the Federal Reserve (Fed), also influences the DJIA as it affects the cost of credit, on which many corporations are heavily reliant. Therefore, inflation can be a major driver as well as other metrics which impact the Fed decisions.
Dow Theory is a method for identifying the primary trend of the stock market developed by Charles Dow. A key step is to compare the direction of the Dow Jones Industrial Average (DJIA) and the Dow Jones Transportation Average (DJTA) and only follow trends where both are moving in the same direction. Volume is a confirmatory criteria. The theory uses elements of peak and trough analysis. Dow’s theory posits three trend phases: accumulation, when smart money starts buying or selling; public participation, when the wider public joins in; and distribution, when the smart money exits.
There are a number of ways to trade the DJIA. One is to use ETFs which allow investors to trade the DJIA as a single security, rather than having to buy shares in all 30 constituent companies. A leading example is the SPDR Dow Jones Industrial Average ETF (DIA). DJIA futures contracts enable traders to speculate on the future value of the index and Options provide the right, but not the obligation, to buy or sell the index at a predetermined price in the future. Mutual funds enable investors to buy a share of a diversified portfolio of DJIA stocks thus providing exposure to the overall index.
Standard Chartered’s Nicholas Chia argues that softer Australian labour data and activity indicators support the view that the Reserve Bank of Australia has likely peaked its cash rate at 4.35%. The bank highlights rising unemployment, weaker PMI and moderating wage growth, and sees a high bar for further hikes, with potential easing only if activity deteriorates sharply.
Softer labour data ease RBA pressure
"Australia’s unemployment rate rose 0.21ppt to 4.49% in April, the highest since late-2021. This follows the May decline of the flash services PMI (47.7) into contractionary territory, and Q1 wage growth easing to 3.3% y/y, in line with the Reserve Bank of Australia’s (RBA’s) latest forecast."
"That said, we are wary of characterising the labour market as ‘breaking’, given that April is only one data point and monthly hours worked were still up 0.8% m/m seasonally adjusted (SA)."
"The April labour market report supports our view that the RBA’s cash rate may have peaked at 4.35%."
"We see a high bar for the RBA to hike rates further absent a re-acceleration in demand and given the government’s fiscal restraint in the latest budget."
"Any sharp deterioration in economic activity – while not our base case – may even lead the RBA to contemplate unwinding some of this year’s policy tightening."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Eurozone's preliminary HCOB Composite PMI deteriorates further in May. The Composite PMI arrives lower at 47.5, while it was expected to remain steady at 48.8. A figure below 50.0 is considered a contraction in the business activity. The Composite PMI contracted significantly due to a slowdown in the manufacturing sector and a further weakness in the service sector activity.
The Manufacturing PMI drops to 51.4 from 52.2 in April. The manufacturing sector activity growth was expected to slow down, but at a moderate pace to 51.9. The Services PMI declines further to 46.4 from the previous reading of 47.6.
"May’s flash PMI survey data show the eurozone economy taking an increasingly severe toll from the war in the Middle East. Output has now contracted for two successive months, with the rate of decline accelerating in May to its highest for just over two-and-a-half years. The survey data indicate that the euro area economy looks set to contract by 0.2% in the second quarter," Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, said.
Market reaction
A decent recovery is observed in the Euro (EUR) during the Eurozone flash PMI data release; however, the impact appears to be the outcome of a sharp correction in the US Dollar (USD). At press time, EUR/USD bounces back to near 1.1616 from the intraday low of 1.1595.
Euro FAQs
The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.
Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.
Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
- GBP/JPY stalls below 213.70 resistance, after a 0.85% weekly appreciation.
- The Pound has shrugged off soft CPI data and concerns about the UK's political uncertainty.
- In Japan, strong trade data and hawkish comments by BoJ's Koeda have failed to lift the Yen.
The British Pound (GBP) is trading practically flat against the Japanese Yen (JPY) on Thursday, right below one-week highs around 213.70. The Sterling has shrugged off soft UK CPI data released on Wednesday and investors’ concerns about the UK labour Cabinet’s weakness, and rallies 0.85% so far this week.
In Japan, April's Trade Balance data released earlier on the day showed an unexpected surplus amid a larger-than-expected increase in exports. Beyond that, Bank of Japan (BoJ) Board member Junko Koeda stated that the bank should raise interest rates as price pressures grow. The positive impact on the yen, however, has been marginal.
Technical Analysis: Bulls eye range top at 214.38
GBP/JPY trades at 213.41, holding a constructive bias, with nearby resistance at 213.70 under pressure. Momentum indicators in the 4-hour chart support the positive view. The Relative Strength Index (RSI) at 59.21 leans towards the bullish side without being overbought, and the Moving Average Convergence Divergence (MACD) indicator holds slightly positive territory, hinting that upside momentum is still intact but not explosive
Bulls are looking beyond the mentioned 213,70 resistance level to the May 11 high, near 214.40, the top of May's trading range. Above here, the next target would be the April 30 high, at 216.60.
On the downside, initial support is located at Tuesday's low, of 212.65, followed by the May 17 low near 211.25 and the April 2, 3, and 30 lows, near 210.40
(The technical analysis of this story was written with the help of an AI tool.)
Pound Sterling Price Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.14% | 0.04% | 0.06% | 0.21% | 0.47% | 0.19% | 0.04% | |
| EUR | -0.14% | -0.11% | -0.06% | 0.05% | 0.32% | -0.00% | -0.11% | |
| GBP | -0.04% | 0.11% | 0.04% | 0.16% | 0.44% | 0.13% | -0.01% | |
| JPY | -0.06% | 0.06% | -0.04% | 0.11% | 0.41% | 0.05% | -0.03% | |
| CAD | -0.21% | -0.05% | -0.16% | -0.11% | 0.30% | -0.02% | -0.17% | |
| AUD | -0.47% | -0.32% | -0.44% | -0.41% | -0.30% | -0.32% | -0.48% | |
| NZD | -0.19% | 0.00% | -0.13% | -0.05% | 0.02% | 0.32% | -0.15% | |
| CHF | -0.04% | 0.11% | 0.01% | 0.03% | 0.17% | 0.48% | 0.15% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
Forex Market News
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