We’re coming off a busy Thursday session that brought several major developments, both on the macro and corporate fronts. While volatility has calmed somewhat, markets are still digesting the aftermath of central bank decisions and earnings releases, and Friday is shaping up to be a quieter — but still important — session.
Let’s start with the macro front. The Bank of England delivered a widely expected 25 basis point rate cut, bringing the benchmark to 4.25%. The initial reaction was bullish for the pound, but that optimism faded quickly as investors reassessed the forward guidance. Meanwhile in the U.S., unemployment claims came in largely in line with expectations, offering no major surprise to shift market sentiment.
On the currency market, the U.S. dollar continued to strengthen, supported by steady economic data and Jerome Powell’s neutral-to-hawkish tone from Wednesday’s press conference.
Moving to the indices, Thursday saw relative strength in U.S. markets, with all major indices closing higher, despite the drop at the end of the session. Futures this morning are flat to slightly positive, suggesting a steady open unless today’s data brings surprises. European indices are opening on a cautious note, showing slight gains as the session begins.
In commodities, we saw gold and silver struggle again, as the stronger dollar pressured precious metals. Oil, meanwhile, is holding firm, slowly recovering from its early-week plunge and supported by a slightly more optimistic outlook on global trade.