US stocks stage a bullish reversal on increased Fed rate cut bets. Asia Pacific markets maintain their momentum on positive China data. The US dollar consolidates while Gold's momentum stalls.
US stock futures extended gains with Asia equities; Gold’s bullish momentum stalls
The bulls roared back to life in the US stock market as dip buyers rushed in after last Friday’s weak US jobs data-induced sell-off. On Monday, 4 August, the S&P 500 rallied by 1.5% to close at 6,330, back above its 20-day moving average (6,308). The tech-heavy Nasdaq 100 outperformed, gaining 1.9%, while the Dow Jones Industrial Average added 1.3%.
Yesterday’s bullish reversal in global equities has also been fuelled by an increase in expectations for the first US Federal Reserve interest rate cut, which is expected to occur at the next FOMC meeting on 17 September.
Based on the latest data from the CME FedWatch tool at this time of writing, Fed Funds futures traders have increased their bets to push up the probability of a 25 basis-point cut on 17 September to 92% from an 80% chance on last Friday, 1 August.
In today’s Asia session, the S&P 500 and Nasdaq E-mini futures extended their intraday gains by 0.2% and 0.3% respectively. Asia Pacific stock markets have also maintained their bullish momentum, reinforced by a better-than-expected private sector compiled services activities report on China.
China’s Caixin Services PMI for July jumped to 52.6 from June’s nine-month low of 50.6, above consensus forecasts of 50.4. The latest reading signalled the fastest expansion in the services sector since May 2024.
Hong Kong’s Hang Seng Index recorded its second consecutive positive performance with an intraday gain of 0.5%, in line with Singapore’s Straits Times Index, as it inched higher by 0.5% to trade at 4,218, rebounding from the 20-day moving average (4,177). Meanwhile, Japan’s Nikkei 225 rallied by 0.6%, halting its prior two days of consecutive losses.
After last Friday’s intraday sell-off in the US dollar, the US Dollar Index has started to consolidate and shaped a minor bounce of 0.2% in today’s Asia session as market participants await the release of the key US ISM Services PMI data for July later today (June: 50.8, Consensus: 51.5).
The Swiss franc is the weakest major currency against the US dollar at the time of writing, shedding -0.3%, followed by the EUR (-0.2%) and AUD (-0.1%).
The ongoing rebound in the US dollar has stalled Gold’s (XAU/USD) intraday bullish momentum, capping gains just below an intermediate resistance level near US$3,380. In today’s Asian session, the yellow metal is trading flat around US$3,370, with short-term technical indicators suggesting a potential minor pullback toward the key near-term support zone of US$3,345–3,334.
Our YouTube video above contains the latest intraday technical analysis on the latest intraday technical analysis on US Wall Street 30, US Nas 100, US SPX 500, Hong Kong 33, Japan 225, Germany 30, EUR/USD, GBP/USD, AUD/USD, USD/JPY, Gold (XAU/USD), and West Texas Oil.
