EURUSD is holding above the 1.19 handle, retaining a bullish bias after a rally witnessed on Friday
Wall Street stocks advanced on Friday, driven mostly by the tech sector, with the Dow moving into positive territory for the year while the S&P and the Nasdaq made the fifth consecutive weekly gains. On the data front, the official report showed that American consumers increased their spending more than expected in July. The personal consumption expenditures core index rose at a rate of 1.3% year-on-year. As a result, the Dow Jones Industrial Average rose 0.32%, the S&P 500 gained 0.30%, and the Nasdaq Composite added 0.4%.
Asian stocks were mixed on Monday, with Japan equities leading gains amid political developments in the country where the search for the country’s new prime minister continues after Prime Minister Shinzo Abe announced a surprise resignation on Friday due to health reasons. Elsewhere, official China’s manufacturing PMI for August came in at 51.0, marginally below expectations of a reading of 51.2. The Shanghai Composite Index declined by 0.23%, the Nikkei 225 in Tokyo added 1.12%, Hong Kong’s Hang Seng shed nearly 1%, while the Kospi in Seoul slipped 1.7%.
European stocks opened higher on Monday, with the U.K. markets being closed due to a bank holiday. Hopes of more global stimulus measures helped underpin investor sentiment after a dovish message from the Fed last week. Later in the day, German inflation numbers could affect investor sentiment in the short term.
Ahead of the release, EURUSD is holding above the 1.19 handle, retaining a bullish bias after a rally witnessed on Friday amid broad-based weakness in the greenback. If the pair stays bid following the report, the common currency could target fresh more than two-year highs above 1.1965 and climb to the 1.20 psychological level that could deter bulls and trigger a downside correction amid the overbought conditions. In the immediate term, the prices need to overcome the 1.1930 nearest resistance.