MARKETS US/Shipping – Prospects of further rate hikes weighed on

NEW YORK (Dow Jones) — Wall Street is likely to start the last trading day of the week with a minus. The future on the S&P 500 is currently losing 0.6 percent. The prospect of further rate hikes by the US Federal Reserve continues to weigh.

The day before, at the end of the two-day semi-annual hearing before Congress, Fed Chairman Jerome Powell once again emphasized that further interest rate hikes are to be expected this year as inflation is to be brought back to the target rate of 2 percent. “We don’t want to do more than we have to do,” Powell said. “The overwhelming majority of FOMC members believe that more rate hikes are on the way, but we want to do them at a pace that allows us to take the incoming information into account.”

Fed funds futures are currently pricing a 75 percent chance of another rate hike in July one. In addition, the Swiss central bank and the Bank of England, among others, had raised interest rates the day before – the latter even more significantly than expected.

Against this background, the purchasing managers’ indices for the service sector and the manufacturing sector, which will be due after the start of trading, should be of particular interest in June. In addition, further Fed members commented with the President of the St. Louis Fed, James Bullard, the President of the Atlanta Fed, Raphael Bostic, and the President of the Cleveland Fed, Loretta Mester.

Oil prices continue to fall – dollar strengthens

Oil prices tumble again and are heading for sharp weekly losses after a string of rate hikes and the prospect of more hikes in the US raised concerns about global demand growth. “Oil is approaching critical support levels which, if broken to the downside, would likely push prices below $65 a barrel,” said Spartan Capital’s Peter Cardillo. Summer fuel demand in the US is higher than a year ago but is nearly 5 percent below pre-pandemic 2019 levels.

The prospect of further interest rate hikes in the US is driving the dollar again. The dollar index improves by 0.4 percent. The euro, on the other hand, fell to a weekly low after the purchasing managers’ indices for June fell euro zone were weaker than expected across the board.

On the bond market, yields are giving up all of their previous day’s gains. The expectation of further interest rate hikes had driven them up sharply. The yield on ten-year paper fell by 7.7 basis points to 3.72 percent.

Ford weaker – 3M firm after comparison

In terms of individual values, Ford shares are down 0.8 percent pre-market. The automaker is gearing up for further job cuts to lower costs, which are high compared to its competitors. According to those informed, another round of layoffs is set to begin in the coming weeks.

3M, on the other hand, grew by 3.5 percent. Because of the pollution of drinking water, the US industrial giant has agreed to pay up to $ 12.5 billion to settle legal disputes. Virgin Galactic Holdings, on the other hand, fell 13.9 percent. The space company wants new shares spend up to $400 million.

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US Bonds

Term Yield Bp to VT Yield VT +/-Bp YTD

2 years 4.72 -7.5 4.80 30.0

5 years 3.96 -8.8 4.05 -4.3

7 years 3.84 -8.8 3.92 -13.5

10 years 3.72 -7.7 3.79 -16.3

30 years 3.80 -6.9 3.87 -16.7

FOREX last +/- % Fri, 8:39 Thu, 17:05 % YTD

EUR/USD 1.0893 -0.6% 1.0922 1.0959 +1.8%

EUR/JPY 155.76 -0.6% 156.55 156.49 +11.0%

EUR/CHF 0.9769 -0.4% 0.9810 0.9825 -1.3%

EUR/GBP 0.8554 -0.5% 0.8592 0.8599 -3.3%

USD/JPY 142.99 -0.1% 143.32 142.77 +9.1%

GBP/USD 1.2734 -0.1% 1.2713 1.2745 +5.3%

USD/CNH (Offshore) 7.2109 +0.2% 7.2224 7.1990 +4.1%

Bitcoin

BTC/USD 30,070.68 +0.0% 30,043.64 29,845.76 +81.2%

CRUDE OIL last VT settlem. +/- % +/- USD % YTD

WTI/Nymex 68.44 69.51 -1.5% -1.07 -13.8%

Brent/ICE 73.17 74.14 -1.3% -0.97 -12.6%

GAS VT Settlem. +/- EUR

Dutch TTF 32.62 34.10 -4.3% -1.48 -57.5%

METALS last day before +/- % +/- USD % YTD

Gold (Spot) 1,923.42 1,913.64 +0.5% +9.79 +5.5%

Silver (Spot) 22.42 22.28 +0.7% +0.15 -6.4%

Platinum (Spot) 927.23 927.50 -0.0% -0.28 -13.2%

Copper Future 3.82 3.89 -1.8% -0.07 +0.1%

YTD relative to previous day’s close

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DJG/ros/err

(END) Dow Jones Newswires

June 23, 2023 08:49 ET (12:49 GMT)

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