The euro is battered as activity data deteriorates as global markets aim for their sixth straight day of gains

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Last Updated on July 23, 2022 by Bitfinsider

The euro was hurt by disappointing data on corporate activity in the euro zone, which added to the burden of the region’s debt, and global markets eked out a sixth day of gains.

The MSCI World index, the broadest measure of world markets, was last up 0.1%, and the Euro STOXX 50 index continued to advance, closing the day up 0.4%.

The MSCI’s largest index of Asia-Pacific shares outside of Japan increased overnight by 0.1%, putting it on pace to post its largest weekly gain in roughly two months.

U.S. stock futures indicated a negative opening after disappointing overnight results from internet startup Snap Inc alarmed investors ahead of Twitter Inc’s earnings later on Friday.

While Nasdaq futures were down 0.3% and S&P 500 futures were down approximately 0.2% at the close, respectively, despite the negative overnight sentiment.

The expectation for additional central bank intervention on both sides of the Atlantic amid growing inflation dampened mood despite Russian gas temporarily flowing back into Europe and some positive earnings reports in the area due to political unrest in Italy.

For the first time in 11 years, the European Central Bank increased interest rates on Thursday by a larger-than-anticipated 50 basis points to zero percent, ending a policy of negative interest rates that had been in effect since 2014.

Chief Investment Officer at UBS Global Wealth Management Mark Haefele stated that he was still apprehensive about the stock market outlook.

Markets responded favorably to the larger-than-anticipated 50-basis-point increase, he added, “but we maintain a cautious stance on European stocks as the ECB skates a tight line between battling inflation and avoiding recession.”

The euro initially rose against the dollar, but after reversing course, it lost more ground on Friday as traders considered the expected course of interest rates. After poor company activity data appeared on traders’ screens, it increased losses.

According to a survey, economic activity in the euro zone unexpectedly decreased this month. Companies continued to report higher costs as inflation increased, reducing consumer demand and impacting on the outlook.

The euro was last trading down 0.7% against the dollar at $1.0164, but it is still up roughly 0.8% for the week and is on track to post its greatest weekly gain in two months.

The dismal Purchasing Managers Index data had a negative impact on German 10-year debt yields as well, which dropped as much as 17 basis points (bps) to 1.046 percent. Their most recent price was 1.06 percent.

In other foreign exchange markets, the dollar gained 0.4% against a basket of major counterparts, supported by the weaker euro, but it continued to be headed for its biggest weekly loss since late May as recent disappointing economic data tempered expectations for the size of an impending Federal Reserve interest rate increase.

Next week, when the U.S. Federal Reserve meets to decide on interest rates, pricing for a 75 bps increase has replaced earlier expectations of a 100 bps increase.

Ahead of its best week since last October, the top cryptocurrency Bitcoin was last up 1.6% to $23,470.

Across all commodities, oil prices continued to decline, with U.S. WTI crude futures down about 1.5% and Brent crude futures falling 1.3%. The price of gold increased, rising 0.3% to $1723.5 for an ounce.


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Hardware wallets are safe and secure devices that can be used offline. They keep your cryptocurrency offline, making it impossible for you to be hacked. To find out more on the leading hardware wallets, you may view our reviews here: Ledger & Trezor
Disclaimer: The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, legal, tax or other advice. Investing in or trading cryptocurrency or stocks comes with a risk of financial loss.

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