Stocks Continue Upwards; Dollar Loses Ahead of US Jobs Data

By Peter Bukov|

Published: August 05 2022, 07:31 GMT+0

Stocks Continue Upwards; Dollar Loses Ahead of US Jobs Data

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US stocks don’t care anymore about any bad economic (or geopolitical) news, and they keep enjoying the rally, while the US dollar bulls seem exhausted.
As of writing, US equity indices trade higher again, waiting for today’s US jobs market data. However, the USD has failed to post new highs over the previous weeks, likely leading either to a prolonged consolidation or a profit-taking decline.

Recession risks have grown in the US, according to Federal Reserve member Loretta Mester,also noted that supply problems are likely to last for some time. Finally, she indicated that interest rates should climb at least through the first half of 2023 and this year. The market currently expects one rate cut in the first quarter of 2023.

Gold remained bid, pushing toward the 1,800 USD again as a rise in tensions between China and Taiwan following Beijing’s firing of missiles over the island as part of a “military practice” also contributed to an increase in demand for safe havens throughout Asia. The action was a response to Chinese opposition to US House of Representatives Speaker Nancy Pelosi’s travel to Taiwan this week.

Jobs markets in focus

The US job statistics will be the main topic later today. First, the nation will provide the Nonfarm Payrolls data, which is predicted to reveal that 250,000 new positions were added in July, a decline in growth from 372,000 in June. That would be the 19th month in a row that payrolls have increased, even though it would be the smallest gain in that time; Finally, it is anticipated that the unemployment rate will stay at 3.6%.

Additionally, the Canadian jobs market data will be released, with investors projecting the net employment change to slightly improve from -43,200 to 20,000. On the other hand, the unemployment rate is seen worsening a notch to 5.0%. As a result, the USDCAD pair will undoubtedly be volatile afterward.