Sun, February 25, 2024

Weekly Overview: Forex, Stocks, Crypto, Commodities May 20

Weekly Overview: Forex, Stocks, Crypto, Commodities

Global markets and trends change every day. Several major influencers are causing price swings every second. How have the markets performed this week? What are the general updates in Forex, Stocks, Cryptocurrencies, and Commodities? Our weekly overview will answer that question and summarize the week’s overall market performance.

Forex Weekly Overview

The dollar was set for its worst week against major currencies on Friday since early February as some of the heat faded after the greenback surged 10%.

The greenback was supported by investors fleeing the market amid fears of rising inflation and the fallout from Russia’s invasion of Ukraine.

But after rising in all but two of the past 14 weeks, the dollar index was on track for a weekly loss of 1.5% on Friday.

The index, which tracks the dollar against six major currencies, was little changed on the day at 102.92. It was at 105.01 on Friday, the highest level since January 2003.

The report added that a recent increase in dollar-long positions could help extend the pullback.

Other safe-haven currencies rose this week as global equities came under pressure.

The Swiss franc gained nearly 3% on a weekly basis against the dollar. Meanwhile, the yen gained almost 1% on a weekly basis.

The Swiss franc was little changed at 0.97350 francs, while the yen was down 0.2% at 128.205 yen.

The euro, which also benefited from a weaker dollar, was on track to gain 1.5% for the week. It was last down 0.1% at $1.05755 for the day.

Sterling was set for its biggest weekly gain since December 2020, unchanged at $1.24805 on the day.

Stocks Weekly Overview

European markets moved higher on Friday, tracking global gains as another volatile trading week drew to a close.

The pan-European Stoxx 600 was up 1.2% in early trade, with underlying resources surging 2.4% to drive gains as most sectors and major exchanges moved into positive territory. Household goods fell 0.6%.

European stocks were still set for a week of losses after closing sharply lower on Thursday, as inflation concerns and ominous earnings reports from U.S. retailers clouded global sentiment.

Asia-Pacific markets rose on Friday, led by Hong Kong’s Hang Seng, as China left the one-year rate unchanged at 3.7% but cut the five-year rate by 15 basis points.

U.S. stock futures rose in premarket trading, signalling a higher open on Wall Street on Friday, with traders eyeing whether the S&P 500 could slip into a bear market.

Global investors continued to focus on the war in Ukraine and its geopolitical fallout, which has sent global energy and food prices soaring. Failure to reopen Ukrainian ports would pose a challenge to global food security, the World Food Program said.

While there are signs that some parts of the country are returning to a degree of normalcy, the war could continue throughout the summer and beyond.

On the data front, producer prices in Germany rose 33.5% year-on-year in April to a record high, as the war in Ukraine pushed up energy costs in Europe’s largest economy.

In terms of individual stock price action, Denmark’s Rockwool International led the Stoxx 600 after its first-quarter earnings report, up more than 7%.

At the bottom of the index, Swiss luxury goods company Richemont fell more than 10 percent after reporting its full-year results.

Crypto Weekly Overview

Global cryptocurrency markets recovered slightly on Friday, May 20, gaining about 3% over the past day, in line with the stock market’s gains. Major cryptocurrencies such as Bitcoin, Ethereum, and Polkadot were also little changed but remained in the green. However, experts say that the crypto market does not seem to experience much recovery unless the macroeconomic situation improves.

Bitcoin, Ethereum, and other altcoins moved with the stock market. Bearish sentiment on Wall Street also spilled over to the crypto market. Markets responded in a risk-off fashion just a day after Federal Reserve Chairman Jerome Powell commented that raising interest rates by 50 basis points would continue to keep inflation in check. Unless macroeconomic conditions improve, crypto markets are unlikely to recover quickly.

Bitcoin is at $30,058.20 today, up 3.25% over the past 24 hours. While BTC is stable at the $30,000 mark, consider that roughly $640 million in BTC options will expire on Friday, May 20. This could lead to another drop in BTC to recent lows.

Rising inflation concerns and fears of a global economic slowdown weigh sentiment towards risk assets, including cryptocurrencies. Bitcoin managed to break through the pessimism in the cryptocurrency market, breaking the $30,000 mark. Time will tell if it can continue to swim upstream.

According to the data, ether is trading at $2,016.59 today among altcoins at the time of writing. This is up 3.41% in the past 24 hours.

Polkadot should lead the next bull run in the altcoin space as it rallied nearly 4.5% over the past seven days after announcing that interoperability and multi-chaining would be its primary focus at the recent WEF22 conference.

Commodities Weekly Overview

Oil prices fell on Friday. A planned European ban on Russian oil offset investor fears that weak economic growth would hit demand.

July Brent crude futures were down 10 cents, or 0.1%, at $111.94 a barrel by 09:20 GMT, while June U.S. West Texas Intermediate (WTI) crude was last at It was down 56 cents, or 0.5 percent, at $111.65 on the day. Previous month.

The more actively traded July WTI contract (CLc2) was down 0.23 cents at $109.66 a barrel.

The International Monetary Fund (IMF) has urged Asian economies to consider spillover risks from monetary tightening.

 Asian economies faced a choice between supporting growth with more stimulus or exiting to stabilize debt and inflation.

Central banks in the U.S., U.K., and Australia have recently raised interest rates even as the BOJ’s policy runs counter to the global shift toward tighter monetary policy.

If U.S. growth data continues to deteriorate, oil prices could be caught in a negative feedback loop for the stock market.

Yet Americans continue to drive despite rising fuel prices, according to the Federal Highway Administration’s report on vehicle mileage.

The EU hopes to agree on a proposed ban on imports of Russian crude that includes exemptions for EU countries most reliant on Russian oil, such as Hungary.

Further reductions in German imports of Russian oil will make it easier for the EU’s largest economy to wean itself off Russian crude and product imports sooner.

More Russian barrels are available and Iranian crude exports to China fell sharply since the Ukrainian war began; hence, it has become harder to sell Iranian crude as Beijing buys Russian barrels at a discount.

Wrapping Up

Global markets fluctuate greatly. Cryptos have slightly recovered, while oil prices have fallen slightly. Meanwhile, the Ukraine crisis has had a large impact on the markets. What should we be expecting next week?


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