EU Daily Market Wrap - 16th May 2019

EU Daily Market Wrap - 16th May 2019

Today's Highlights


  • Trump may continue Auto Tariffs talks beyond May

  • US talks with China have reached its core

  • Salvini to "Tear apart every single EU rule butchering Italy"

  • US Philly Fed Manufacturing  rebounds in April

  • Tensions in the Middle East revamp as Iran breaks US sanctions

  • PM May Promises to Agree Timetable for Quitting in June


Macro Review

The session was mainly signed by gains in the US Dollar exacerbated by weakness in EUR and GBP amid Salvini's comments and renewed pressure on Theresa May leadership. We have also seen an improvement in risk appetite today with Global shares recovering off the recent lows as trade tensions fade away, despite recent Trump comments on EU Auto Tariffs. I guess it make sense to see a rebound in equities after reaching the peak of the Trade tensions and bottoming out around key technical areas. The question is whether Trump will protract and repeat the same stance with EU and Japan and if the US-China is a done deal.


US Equities rallied betting on a resolution between US and China after US Ross said that Trade talks have reached its core. The positive sentiment helped also the recovery in European Indices despite Trump plan to continue talks on Auto Tariffs which was in contrast with yesterday positive headline suggesting a possible delay on EU tariffs. 


The FX space was led by gains in the US Dollar, with the index trading firm above the 97 level and all major G10 counterparts in negative territory. EUR dropped to 1.1200 level after Salvini tougher stance towards EU Rules and Trump's remarks on EU Auto Tariffs.The move in the Dollar was also supported by a positive round of US data today with the Philly Fed Manufacturing Index headline beating the most optimistic prediction in the street 16.60 vs 10 expected. 



Crude Oil slowly hedge higher today retesting the 63.40 (21 DMA) level amid renewed tensions in the Middle East, as Iranian tankers were seen unloading a cargo of 130K tonnes of Oil near Zhousan in China (in violation with US Sanctions).Gold dropped back below the 1290 level amid USD strength and risk-on sentiment.


EU Close

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Hope you enjoyed the session.

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