Fears of Continued Tightening Policies Weigh on Markets

market news summary

European stocks fell over 1% at the close on Thursday amid a widespread sell-off, driven by rising bond yields as major central banks around the world hinted at keeping interest rates high for longer. The European Stoxx 600 index closed down 1.3%, with travel and entertainment stocks dropping by 3.2%, and mining stocks declining by 2.6% due to falling metal prices against the dollar.

Yields on eurozone bonds rose to their highest levels in several months after the Federal Reserve and the Bank of England kept interest rates unchanged but indicated the possibility of further hikes in the future due to their ongoing concerns about inflation.

Dollar Index (USDX)

The US dollar and US Treasury yields have risen following indications from the Federal Reserve that there could be another interest rate hike later this year. Jerome Powell, the Chair of the Federal Reserve, announced on Wednesday that policymakers are prepared to raise interest rates if conditions support it. He also stated that they will continue to hold consecutive meetings to monitor the economic situation and make decisions based on available data.

The US Dollar Index is currently trading around its pivotal point at $105.10.

Pivot point: 105.15

Resistance level	Support level
105.30	104.85
105.60	104.60
106.05	104.20

Spot Gold (XAUUSD)

Gold prices rebounded from their declines immediately after the release of significant US data yesterday, which encouraged the Federal Reserve to continue its hawkish monetary policy. Unemployment claims came in at 201,000, lower than experts’ expectations of around 225,000. Additionally, the Philadelphia Manufacturing Index recorded a reading of 13.5 points, surpassing expectations of 0.7 points, with the previous reading at 12 points.

Spot gold prices fell by 0.76% to $1,916 per ounce. Meanwhile, US futures contracts for gold dropped by 1.65% to $1,935 per ounce.

Pivot point: 1921

Resistance level	Support level
1929	1911
1939	1904
1947	1894

Dow Jones Index (DJ30ft – US30)

US indices extended their collective sharp losses on Thursday due to growing concerns over the Federal Reserve’s intention to maintain its hawkish monetary policy for longer than expected. Federal Reserve Chair Jerome Powell had warned on Wednesday that inflation still has a long way to go before approaching the 2% target.

The Dow Jones Index fell by 1.08%, approximately 370 points, marking its lowest daily close in over two months. Meanwhile, the Nasdaq index declined by 1.8%, registering its largest daily loss in about a month.

Pivot point: 34455

Resistance level	Support level
34610	34165
34900	34010
35055	33720

US Crude (USOUSD)

Oil prices closed lower after a volatile session on Thursday. They initially rose by a dollar per barrel after Russia lifted a ban on Turkish fuel exports, shifting focus away from the challenges arising from the unfavorable economic conditions in the West, which had earlier reduced prices by a dollar.

Brent crude futures fell by 23 cents to settle at $93.30 per barrel, while West Texas Intermediate (WTI) crude futures dropped by three cents to $89.63. Both crudes had earlier risen and fallen by over a dollar during Thursday’s trading.

Pivot point: 89.60

Resistance level	Support level
90.90	88.30
92.25	87.00
93.50	85.65

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