Trending Update for Wednesday 17/5
S&P 500 closed above 2400 for the second time ever despite worries over Trump. That said, USD-index plummeted to new lows and Nikkei also closed 0.53% lower. USDJPY and EURJPY both lost ground in the Asian hours as the risk appetite faded with fresh allegations from former FBI Director James Comey coming to light. Comey alleged that he has recorded proof of Donald Trump asking him to drop an investigation into actions of Former NSA Adviser Michael Flynn. US Senator John McCain is the latest to up the pressure on Trump as he said that the Trump leaks scandal has reached “Watergate size and Scale”; this is unlikely to help calm market nerves.
The European equities also opened lower with DAX, CAC40, and FTSE100 down 0.8%, 0.6% and 0.3%, respectively. Yesterday’s API report showed a rise in US oil stock inventory and the WTI fell as expected. OPEC is in a predicament over a global supply glut and this could weigh on the commodities bloc currencies.
Elsewhere, the UK unemployment rate fell to 4.6% from 4.7% due to an unexpectedly large gain in employment numbers (121K Actual vs. 21K expected) but average earnings (excluding bonus) also came in line with expectations at 2.4%. Overall the employment data suggests an improvement in the UK labour market.
There is not much data due for the rest of the day post the Euro-area inflation rate (final) at 0900 GMT. We will hear from Mester and Bullard but focus to remain on US politics.