US equities reversed early losses yesterday to settle the session marginally higher following volatile moves in currency markets. The S&P 500 closed 0.1% higher, with Utilities and Healthcare contributing the most gains.
In currency markets, the dollar fell as low as $1.2536 against the euro immediately after the ECB press conference (as Mario Draghi’s comments indicated a degree of comfort with the current level of the euro), before falling to $1.2409 after President Trump suggested that the “dollar is going to get stronger and stronger and ultimately I want to see a strong dollar”.
The dollar resumed its move lower overnight, trading back up towards $1.2473 against the euro. Gold prices benefited from the weak greenback, gaining almost 1%.
Europe
The early strength of the euro and the pound unsettled European equity markets. The Euro Stoxx 50 index fell 0.4%, the German DAX lost 0.9% and the UK’s FTSE 100 settled 0.4% lower.
The ECB left both interest rates and its guidance unchanged yesterday, reiterating that its €30bn a month asset purchase scheme would continue beyond September, “if necessary”.
Asia
Asian equities traded mixed overnight. Japanese stocks fell 0.2% as the yen appreciated against the dollar as gains in Healthcare and Materials were offset by losses in Energy and Financials