Oil rally, U.S-North Korea summit drive the market
Crude oil rallied to fresh high today on a possible sanction imposed on Iran and Venezuela. However, the rally of oil dampened by recent news from President Trump. The President said in comments that planned summit between the U.S and North Korea could happen later than June 12.
The news brought down Dow Jones Industrial Averages, the index currently traded at 24,969 down 44.28 points (-0.18%)
BOE inflation outlook
BOE set to reach an inflation target of 2% as inflation down from 2.5% in March to 2.3% in April. Analyzing the UK economy, it seems policymakers prefer weak Pound which pushes import price up. It is apparent after Mark Carney presents the May inflation report with dovish tone, noting Brexit risk, slowing growth even though the bank throws out massive stimulus.
On the hawkish side, Bank of England Gertjan Vlieghe said he sees more interest-rate hike than the market expectations for the next three years. The market expects three or less 25 bps rate hike in three years. Vlieghe sees 25 to 50 bps rate hike each year provided Brexit uncertainties does not intensify.
Asian & European Stock market
Asian stock market mixed as the market crunching trade news and oil advanced. Nikkei closed down 42.03 points (-0.18%) to 22,960.34, Shang Hai Composite closed flat +0.69 points (+0.02%) to 3,214.53 and Australia ASX 200 down 42.60 points (-0.70%) to 6,041.90. European stock market mildly higher. DAX Germany up 0.03%, FTSE UK up 0.15%, and Euro STOXX 600 up 0.04%.
Technical Analysis
Dow Jones Industrial Average (INDU)
DJIA traded higher at the start of Tuesday trading. However, the index could not maintain the gain and reverse downside and fell back below 25,000 handles.
Newmont Mining Corp (NEM)
NEM follow gold movement which is moving down and reach the support on the daily chart. The weakness might continue as U.S dollar continue putting pressure on gold. However, on NEM chart there are strong supports lining up, ready to support the share prices if there is more weakness. Will the share prices bounce from the daily averages and the trendline?