Equities track Wall Street retreat - 3.8.2023

The Dollar strengthening is intact currently. The live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, rose 0.8% Wednesday as payroll firm ADP said the US private sector added above expected 324,000 jobs last month.

EUR/USD joined GBP/USD’s accelerated sliding on Wednesday. Both Pound and euro are lower against the dollar. USD/JPY accelerated its advancing yesterday whileAUD/USD continued sliding with both the yen and the Australian dollar lower against the Greenback currently.

The US stock index futures are lower currently ahead of unemployment claims and ISM Services PMI reports at 14:30 CET today. The three main US stock indexes ended solidly lower on Wednesday in the range from -2.2% to -1.0% after rating agency Fitch downgraded the US government's top credit rating citing fiscal deterioration over the next three years and deterioration in standards of governance over the last 20 years, including on fiscal and debt matters.

European stock indexes futures are falling currently ahead of the Bank of England interst rate decision at 13:00 CET today where it is widely expected the bank will raise interest rates by a quarter-point. Indexes closed lower yesterday led by mining and retail stocks. Asian stock indexes futures are retreating today with Japan’s Nikkei index leading losses while a private survey showed China's services activity expanded at a faster pace in July.

Brent is extending losses presently. Prices ended lower yesterday despite Energy Information Administration report US crude inventories fell by record 17 million barrels in the last week while total product supplied - a proxy for demand - fell by 1.3 million barrels in the week to 20 million barrels per day. The US oil benchmark West Texas Intermediate (WTI) futures slid 2.2% and is lower currently. Brent crude lost 2% to $83.20 a barrel on Wednesday.