Sentiment Worsens After Chinese Data
16 May 2022
US equity futures were down 0.5% during the London session, while EU bourses opened circa 1% lower as Chinese data disappointed market players.
Situation in China is not improving
Despite the fact that no cases have been detected in five of Shanghai's 16 districts, the city has declared that coronavirus restrictions would stay in place owing to the high risk of infection resurgence.
Additionally, Chinese economic data crashed in April, as a result of the COVID lockdowns. Retail sales dropped from -3.5% to -11.5% annually, while industrial production cratered from 5% to -2.9%.
Later today, the Economic Growth Forecasts for the eurozone will be published by the European Commission. Additionally, the Monetary Policy Hearing of the Bank of England will be held in the UK parliament.
During the US session, only the Federal Reserve Bank of New York's Empire State Manufacturing Survey for May is on the agenda, expected to weaken notably from 24.6 to 15.5.
In the Forex market, the USD remains bid, with the EURUSD pair trading at around 1.04 and GBPUSD slipping toward 1.22.
Strong USD and rising yields are causing havoc in the precious metals sector, pushing gold below 1,800 USD for the first time since January, while silver plunged below 21 USD, the lowest level since July 2020.