U.S. manufacturing activity rebounds in May
The trading week officially began today, after Monday’s bank holiday, and was awoken by news that manufacturing activity in the United States had increased.
Figures released by IHS Markit showed that national factory activity rose to a reading of 61.2 in May, which was a pick up from April’s 60.7 reading.
Typically, a reading above 50 suggests that the sector is growing, with anything below signaling contraction.
Manufacturing which currently contributes to close to 12% of the U.S. GDP, and many believe that the sector may continue to grow as we head into a post-pandemic world.
As of writing, the blue-chip Dow Jones was trading 0.21% higher on the news.
FTSE 100 higher, as Sterling hits 3-year high
The FTSE 100 got off to a strong start on Tuesday, after being closed yesterday due to a public holiday.
Britain’s main index rallied, as UK house prices rose at the fastest pace in 7 years, with data also showing manufacturing activity had risen.
Although the rise came at a slower pace than expected, it was enough to send the FTSE 100 0.82% higher.
In addition to this, GBPUSD rose to its highest rate since March 2018, hitting an intraday high of $1.4250.
The cable rate was however unable to breach the long-term resistance level, and soon fell, and is now trading close to $1.4160.
With several key economic releases this week many wait to see if further shifts could arise.
Oil prices rise as OPEC+ increases output
Crude oil prices were on the rise in today’s trading session, as OPEC and its allies,. Which include Russia, met to discuss output.
Today’s meeting concluded, with the cartel agreeing to increase output by 841,000 barrels a day in July. Following previous hikes in May and June.
The cartel decided in April to hike supply to 2.1 million barrels per day, as Europe eased lockdown restrictions. And prepared for increased tourism over the summer.
WTI Crude hit an intraday high of $68.87 in today’s session. Which is the highest prices of the energy have been since before the pandemic began.
Quote of the day – “I believe in analysis and not forecasting.”– Nicolas Darvas
Senior Market Analyst