Global Market Quick Take: Europe – 28 May 2024 Global Market Quick Take: Europe – 28 May 2024 Global Market Quick Take: Europe – 28 May 2024

Global Market Quick Take: Europe – 28 May 2024

Macro 3 minutes to read
Saxo Strategy Team

Key points:

  • Equities: Muted sentiment ahead of US consumer confidence and Salesforce earnings
  • Currencies: Dollar softens on upbeat risk sentiment
  • Commodities: Silver rally re-ignites wheat hit fresh highs
  • Fixed Income: Focus on ECB speakers and a 2- and 5-year US Treasury auction
  • Economic data: ECB’s inflation expectations, US consumer confidence

The Saxo Quick Take is a short, distilled opinion on financial markets with references to key news and events.

Equities: Markets are coming back to life today following yesterday’s US and UK holiday with slightly negative session in Asia and European equity futures pointing 0.1% higher this morning. Today’s key macro focus is US May consumer confidence after yesterday’s German May IFO figures disappointed against estimates adding a small bump on the road back to growth recovery.

FX: Risk sentiment remained upbeat, pushing the US dollar lower in a quiet session. Unsurprisingly, gains were led by the risk-sensitive commodity currencies and GBP, while JPY and CHF underperformed. NZDUSD surged to 0.6150 while AUDUSD tested a break of 0.6660, helped by a recovery in the yuan after PBOC’s firmer fixing. USDCNH reversed from Friday’s highs of 7.2632 and traded below 7.26. GBPUSD moved above the 76.4% fibo retracement, unfazed by election news, and was last seen at 1.2770. Next target likely to be the 1.28 handle. USDJPY traded just below 157 with AUDJPY inching above 104.40 and GBPJPY breaking above 200. EURUSD was choppy on ECB Lane’s comments who tried to balance out rate cut expectations beyond June, but remains around 1.0860 ahead of the well-anticipated June rate cut. To read more on our FX views, go to our Weekly FX Chartbook published every Monday.

Commodities: Brent trades higher for a third day with WTI joining after being closed yesterday, driven by technical buying after finding support ahead of USD 80 last week, improved growth and demand outlook and not least raised geopolitical tensions ahead of Sunday’s OPEC+ meeting. Meanwhile, gold trades back above USD 2,350 per ounce, supported by silver which surged 4.5% on Monday as traders rushed back in after support held in the key USD 30 area on Friday. Copper also resumed its rally after China stepped up its efforts to rescue its property market, and after the recent correction was arrested before causing any technical damage below USD 4.74 key support. Wheat reached a 9-month high in Chicago, and 1-year high in Paris as production around the world continues to get slashed amid adverse weather. A 12 mn tons downgrade from Russia this past month alone, equalling the amount Egypt, the world's top importer, will buy this year.

Fixed income: With the U.S. and UK markets closed yesterday, ECB speakers were in focus. Bonds in Europe surged after ECB Governing Council member Villeroy suggested potential rate cuts in both June and July, while ECB’s Lane supported a June rate cut. Markets are currently anticipating 25bps rate cut next week, and no chance of another rate cut in July. Italian BTPS outperformed peers, with 10-year BTP yields dropping 6bps to 3.83%, and 10-year Bund yields falling 4bps to 2.55%. This week's focus includes Euro area inflation readings, expected at 0.2% MoM and 2.5% YoY, with a 2.7% core reading. Additionally, sovereign credit rating reviews for France and Italy are scheduled for Friday. In the U.S., attention is on Thursday’s GDP second reading and Friday’s PCE deflator, anticipated at 0.3% MoM for the headline and 0.2% MoM for the core. Today, markets will look at the 2- and 5-year US Treasury note sale and wait to hear from Fed's Mester, Cook and Kashkari, ECB's Knot and BoE's Haskel.

Technical analysis highlights: Top and reversal pattern in US Indices, correction in the cards: S&P500 support at 5,194. Nasdaq 100 support at 18,464, but could drop to 18,170. DAX uptrend potential to 19K. EURUSD likely to test resistance at 1.0885, a break above next 1.0930 and 1.10 GBPUSD uptrend potential to 1.28. USDJPY uptrend potential to 158.45, but short-term correction could be seen. EURJPY potential to 171 but uptrend stretched, expect correction. AUDJPY likely to pushing to 105  EURCHF eyeing 1.00. EURGBP key support at 0.85. Gold correction could dip to 2,314 but expect rebound. Silver uptrend potential to 32.50 and strong resist at 34.40. Platinum rebounding from 1,015 support, uptrend potential to 1,130. Copper bouncing from 474.50 key support, resuming uptrend. US 10-year T-yield bouncing from 4.30 key support. Resist at 4.53

Volatility: With US markets closed for Memorial Day, there is no new VIX data available since yesterday. Last week saw significant volatility, culminating in the VIX closing at $11.93 (-0.84 | -6.58%) on Friday. This marks a substantial drop, indicating reduced market anxiety as we head into a new week. Similar patterns were observed in the shorter-term VIX indices, reflecting short-term stability. Expected moves for the S&P 500 and Nasdaq 100 have declined, suggesting a quieter week ahead in terms of market fluctuations. Key economic indicators to watch this week include CB Consumer Confidence, GDP, Initial Jobless Claims, and the Core PCE Price Index. These reports will provide insights into the economic outlook and potential market movements. Additionally, notable earnings from Salesforce, HP, Costco, Marvell, and MongoDB will be in focus. VIX futures are currently at 13.350 (-0.075 | -0.57%), while S&P 500 and Nasdaq 100 futures show positive movements at 5327.50 (+6.00 | +0.11%) and 18918 (+42 | +0.22%) respectively, reflecting a cautiously optimistic start to the week.

Macro: Germany's headline IFO business climate came in unchanged at 89.3 in May, with current assessment lower at 88.3 from 88.9 but expectations up at 90.4 from 89.7. China set up its third state-backed investment fund worth USD 47.5bln to boost the semiconductor industry. More steps were also seen to address the challenges in the property sector. Shanghai adjusted the minimum down payment ratio for first-home buyers to no less than 20% and for second-home buyers to no less than 30%, while it cut the lower limit for interest rates on first-home mortgages to LPR minus 45bps. Furthermore, Shanghai is to establish and improve the housing system, explore buying housing through state-owned platform companies and other entities, as well as optimize the supply of housing security. The ECB should not rule out lowering borrowing costs at both its June and July meetings, Governing Council member Villeroy said on Monday, pushing back against fellow monetary officials who are uncomfortable at the idea of consecutive cuts. Villeroy told Germany’s Boersen-Zeitung newspaper that he favors “maximum optionality” after next month’s “done deal” reduction in the deposit rate, which he said can only be derailed by a shock.

In the news: Japan net external assets hit record high in 2023, remains world's top creditor (Reuters), China sets up third fund with $47.5 bln to boost semiconductor sector (Reuters), US stock futures inch higher in slim trade as PCE data approaches (Investing), The time is ripe to cut interest rates next week, European Central Bank’s Rehn says (CNBC), Wall Street Moves to Fastest Settlement of Trades in a Century (Bloomberg), Israeli Airstrike, Egyptian Guard’s Death Ratchet Up Tensions (Bloomberg)

Macro events: ECB Inflation Expectations (Apr), exp 1 year at 2.9% vs 3% prior, and 3 year unchanged at 2.5% (0800), Canada Industrial production (Apr) exp 0.9% vs 0.8% prior (1230), US Consumer Confidence (May) exp 96 vs 97 prior (1400), USDA’s weekly corn and soybean planting progress and crop conditions (2000). Fed Speakers: Fed’s Mester, Bowman, Kashkari, Cook, Daly

Earnings events: This week’s main earnings focus is Salesforce (Tue), Costco (Thu), and Dell Technologies (Thu) with the important earnings from a market impact being Costco. Analysts expect Costco to report revenue growth of 8% YoY and EPS $3.69 up 8% YoY.

  • Today: Bank of Nova Scotia, HEICO, Adevinta
  • Wednesday: Bank of Montreal, National Bank of Canada, Salesforce, Agilent Technologies, HP, Pure Storage, Nutanix, Okta, U-Haul, Dick’s Sporting Goods, Viking
  • Thursday: Canadian Imperial Bank of Commerce, Royal Bank of Canada, Costco Wholesale, Cooper Cos, Dell Technologies, Marvell Technology, Veeva Systems, MongoDB, Zscaler, NetApp, Ulta Beauty, Dollar General, Hormel Foods, Best Buy, Burlington Stores

For all macro, earnings, and dividend events check Saxo’s calendar


The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
- Notification on Non-Independent Investment Research (
- Full disclaimer (

40 Bank Street, 26th floor
E14 5DA
United Kingdom

Contact Saxo

Select region

United Kingdom
United Kingdom

Trade Responsibly
All trading carries risk. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more
Additional Key Information Documents are available in our trading platform.

Saxo is a registered Trading Name of Saxo Capital Markets UK Ltd (‘Saxo’). Saxo is authorised and regulated by the Financial Conduct Authority, Firm Reference Number 551422. Registered address: 26th Floor, 40 Bank Street, Canary Wharf, London E14 5DA. Company number 7413871. Registered in England & Wales.

This website, including the information and materials contained in it, are not directed at, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in the United States, Belgium or any other jurisdiction where such distribution, publication, availability or use would be contrary to applicable law or regulation.

It is important that you understand that with investments, your capital is at risk. Past performance is not a guide to future performance. It is your responsibility to ensure that you make an informed decision about whether or not to invest with us. If you are still unsure if investing is right for you, please seek independent advice. Saxo assumes no liability for any loss sustained from trading in accordance with a recommendation.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc. Android is a trademark of Google Inc.

©   since 1992