Markets Report - 26 May 2022

A daily breakdown of the markets for the 26th May 2022, provided to you by Sterlex.

🌍 💵📈📉Risk sentiment gets a slight lift of rest bite through Asia trading session and into the EU/UK cash open, namely equity risk sees some relief off last weeks offers, although most reasons for this and the $ cooling off, mainly down to FOMC minutes yesterday, are not massively convincing reasons & we see this might be short lived. China and Beijing still yoyo on Covid fears as cases soar in Beijing, so this theme likely to weigh on equities and global risk assets still, as we head into June. SPX, EMini, Metals, Bonds may be tentative as the $ come off slightly however technical levels become less focused as fundamentally the $ is well supported above 102 and 99/98.40s due to Russia, China Covid, inflation & rates chatter. US GDP, US Core PCE (Feds favored gauge of inflation), US Durable Goods will be key to watch, additionally to headlines. Keeping an eye on intit

🌍 💵Risk currencies see some bid through Asia slightly down to RBA chatter not selling bonds & new PM election Victory in Australia, eye on this price action being short lived however.

💷 🇬🇧 The back & forth in the UK vs EU on N.Ireland protocol lives on, so not keen on any high conviction trading on our favored $ crosses, GBPNZD, GBPAUD, especially given the temporary lift seen in Risk ccys following on from the Asia open and into EU. May see $ cooling off lean on those crosses as equity risk gets a lift, apart from Cable - which gets some relief momentarily.

💶 💶The Euro remains precarious in our view, so although we see some high yield getting bid for this morning, a weaker euro in the longer run will negate the ECB mandate on price stability that Lagarde often refers to. Her peers have spoken a a lot this past week about managing the Euro in this case. So will draw attention to Euro price this week and next week.