On the first day of the new week the economic calendar is going to be extremely empty. All European Union institutions are closed for Europe Day, while the United States celebrates Memorial Day, thus significantly limiting the opportunity for any important body to release economic reports today. There will still be one speech by a member of the Federal Reserve later today, but that is all.
Some of the most relevant market-moving trends today are merely a result of things that happened over the weekend.
For example, we are seeing a massive rally in cryptocurrencies at the moment. Bitcoin and Ethereum are doing the best in this asset class, both gaining about 6% so far, with the trading day being far from over. Some of these gains are fed by risk appetite and a general optimism among investors.
Nevertheless, Tesla CEO Elon Musk’s lack of Dogecoin endorsements during his time on Saturday Night Live this past weekend disappointed cryptocurrency lovers and pushed them from the meme currency to the more widely accepted Bitcoin and Ethereum.
Meanwhile, US stock indices today are set to trade with a mixed bias. This trend is the result from Friday’s non-farm payrolls, which amounted to 266K against a forecast of almost one million, i.e. nearly four times lower than expected.
Still, instead of depressing the markets completely, this report so far has meant to investors that the ultra loose policy of the Federal Reserve will continue, something that has been good for stocks and US Treasury yields so far in 2021.
Metals are proving to be a more reliable asset class at the moment. Both copper and iron are increasing in value, in part due to the weaker dollar (as a result of last week’s disappointing data), and also due to hopes that the Chinese economy will continue to recover and thus continue to demand more industrial metals.
In other news, Scotland just held parliamentary elections this weekend, where the Scottish National Party gathered the most votes, but was left one seat away from a majority. As a result, the probability of the Scottish government moving forward with a new independence referendum is now a bit lower, though it remains a possibility still.
The British pound appreciated on this news, also bolstered by a further easing of the Covid-19 restrictions as the UK is doing better.
