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    European Stocks, US Futures Increase. USD Stabilizes – May 26

    Central Bank Officials Promise to Keep Monetary Policy Loose 

    US futures advanced on Wednesday, bolstered by the central bank’s promise that inflation would be transitory. More and more central bank officials chimed in with the Federal Reserve’s outlook on inflation and thereby assuaged investors’ worries about the state of the US economy intensified by the latest economic data. 

    Contracts on the Nasdaq 100 and the S&P 500 paved the way for stocks’ upward movement, despite an overnight decline in US benchmarks caused by home-sale and consumer confidence data. Treasuries halted their Tuesday’s rally. The US dollar steadied. 

    Stocks in Europe jumped to near-all time highs on Wednesday, also buoyed by policymakers’ reassurance that they would keep monetary policy loose, even though there were signs of a rise in inflation. The Stoxx 600 index soared 0.3% in the early European section, opening up the fifth day of gains. Germany’s DAX added 0.4%. The CAC 40 in France surged 0.3%. The FTSE in the UK edged 0.2% higher. 

    Like the Stoxx 600, MSCI Inc’s Asia-Pacific share gauge also celebrated the fifth day of profits. On Wednesday, it was helped by gains in Hong Kong and China. The onshore yuan reached a three-year high. 

    Oil stabilized, while gold rose, undoing losses accrued in 2021. Bitcoin recovered, climbing above $40,000. Other cryptocurrencies partly reconquered the positions lost in the volatile May. 

    These are the major moves in the markets on Wednesday:

    Stocks

    The Stoxx 600 index soared 0.3% in the early European section. S&P 500 futures added 0.3%. Futures on the Nasdaq 100 climbed 0.2%. Futures on the Dow Jones Industrial Average gained 0.3%. The DAX increased by 0.4%. French CAC was 0.3% up. The FTSE in London edged 0.2% higher. The MSCI Asia Pacific Index advanced 0.4%. The MSCI Emerging Markets Index jumped 0.4%. 

    Currencies

    The US dollar index was unchanged on Wednesday. The euro was also little changed, trading at $1.2246. The Japanese yen traded at 108.83 per dollar, virtually unchanged. The British pound did not change much on Wednesday and traded at $1.4152. 

    Commodities

    WTI shed 0.2% to trade at $65.94 per barrel. Brent Crude rose 0.1% to $68.72. Gold soared 0.48% to $1,909.60 per ounce. Silver gained 0.44% to $28.18 per ounce. Platinum surged 0.38% to trade at $1,204.000 per ounce. Copper was 0.38% higher at $452.35. 

    Bonds

    The yield on 10-year Treasuries was little changed at 1.56%. Germany’s 10-year yield slid three basis points to -0.19%. Britain’s 10-year yield decreased two basis points to 0.77%.

    Looking forward

    Traders are advised to watch the following events this week:

    • CEOs of the largest U.S. banks, including JPMorgan and Goldman Sachs, will testify before lawmakers in the Senate Banking and House Financial Services committees on Wednesday.
    • U.S. initial jobless claims, GDP, durable goods, pending home sales are unveiled on Thursday.

    Have a rewarding trading day today!

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