Wall Street hopes Fed can stick a soft economic landing, boosting US stocks Thursday

　　

US stock rebounded through trade on Thursday, as Wall Street jumped on hopes Fed can stick the soft economic landing. Two of the Federal Reserve’s most hawkish policymakers pushed back against fears of a recession as monetary settings tighten. Governor Christopher Waller and St. Louis Fed President James Bullard supported the need for restrictive policy to curb price pressures but argued the US can still avoid a contraction.

The possibility of $220 billion of infrastructure stimulus in China also helped ease escalating recession concerns and injected a dash of optimism. Meanwhile, elevated commodity prices including metals and oil and potentially shoring up the Chinese growth outlook.

The benchmarks, S&P 500 and Nasdaq 100 both rose on Thursday. S&P 500 futures fell 0.1% as of 7:12 a.m. in Tokyo. The S&P 500 is up 1.5% daily. Nasdaq 100 futures fell 0.2% The Nasdaq 100 advanced with a 2.16% gain for the day. Ten out of eleven sectors went positive as market sentiment improved. The energy sector outperformed, S&P 500 ENERGY INDEX is the best among all groups.
Meanwhile, Nikkei 225 futures rose 0.4%, S&P/ASX 200 futures climbed 0.7%, Hang Seng futures increased 1.2%

Main Pairs Movement

The US dollar snapped a four-day winning streak to a more than one-month high, closing slightly low at -0.03%, as improved risk sentiment forced the USD off recent highs. Commodity currencies led gains through trade on Thursday. The CAD, NOK, NZD and AUD all moved higher.

The AUD/USD rebounded through trade on Thursday, bouncing from lows approaching 0.6750. Reports said that China is considering introducing a $220 billion bond program designed to fund infrastructure investment through H2 helped ease escalating recession concerns, elevating commodity prices, therefore making the AUDUSD pair more attractive.

The GBP/USD was in a bullish momentum and soared over 0.81%. The pound rose after Boris Johnson announced his intention to resign as British prime minister, easing the political chaos in the UK.

Meanwhile, EUR/USD slumped slightly yesterday. The pair was down 0.22% for the day. European gas futures rose another 6% overnight, marking the highest level since March. Further elevation in energy costs and decline in consumers’ purchasing power is pushing Europe toward recession and a cycle of stagflation.

Economic Data

Currency	Data	Time (GMT + 8)	Forecast
EUR	ECB President Lagarde Speaks	19:55	N/A
USD	Nonfarm Payrolls (Jun)	20:30	268K
USD	Unemployment Rate (Jun)	20:30	3.6%
CAD	Employment Change (Jun)	20:30	23.5K

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