The dollar attempts to regain ground following yesterday’s losses
Wall Street stocks finished higher overnight despite a surge in U.S. consumer prices. The report showed consumer prices rose 5% in May, the biggest year-over-year increase since 2008. Stocks gained as investors are still buying into the Federal Reserve’s stance that the current rise in inflation is transitory. Besides, another report showed pointed to a continued improvement in the labor market. As such, the S&P 500 gained 0.47%, the Dow Jones Industrial Average edged up 0.06%, and the Nasdaq Composite rose 0.78%.
Asian stocks were mixed on Friday as the renewed China-U.S. tensions weighed on investor sentiment somehow. As such, the Shanghai Composite index in China shed 0.58% and the Nikkei 225 in Japan fell 0.03%. Meanwhile, Hang Seng in Hong Kong gained 0.36% while the Kospi in Seoul added 0.77%. European stocks opened flat before advancing to fresh all-time highs as investors shrugged off rising U.S. consumer prices. The Euro STOXX 600 added 0.3% in early trade, with London shares gaining 0.6%. also on the positive side, the European Central Bank on Thursday raised its growth and inflation projections, while pledging a steady flow of stimulus. Also, data showed the lowest level of new claims for unemployment benefits in the US in nearly 15 months last week.
Meanwhile, the dollar attempts to regain ground following yesterday’s losses seen as the 10-year US Treasury yields fell to three-month lows. EURUSD failed to overcome the 20-DMA once again earlier in the day to turn slightly negative in recent trading. If the pressure intensifies any time soon, the pair could challenge the 1.2150 intermediate support. However, downside risks surrounding the euro look limited at this stage. Now, traders are gradually shifting focus to the upcoming Federal Reserve meeting due next week. The greenback could advance ahead of the event amid expectations of a more hawkish tone amid rising inflation.