FxGlobalHub: Market Recap: Wall Street Mixed, USD Stabilizes After Recent Drop, Gold Plummets

Stock market

Major indices on Wall Street moved in mixed directions on Wednesday as trade tensions between the world’s two largest economies eased. Investors awaited a series of new economic data following a strong start to the week driven by lower inflation figures and a temporary tariff truce between the U.S. and China.

U.S. President Donald Trump’s visit to Gulf countries yielded a $600 billion investment commitment from Saudi Arabia. Additionally, several U.S. tech companies rose after the administration announced agreements related to artificial intelligence (AI) in the Middle East on Tuesday.

U.S. Treasury yields climbed as investors anticipated upcoming economic data and budget deficit forecasts amid ongoing congressional discussions.

🔹 Nasdaq: +0.72%

🔹 S&P 500: +0.10%

🔹 Dow Jones: -0.21%

Forex market

The U.S. Dollar gained slightly on Wednesday, recovering from recent declines as investors sought further signs that global trade disputes would continue to cool. Earlier in the week, the DXY Index rose over 1%, reaching a one-month high after the U.S. and China reached a temporary tariff reduction deal, alleviating fears that the trade war might trigger a global recession.

GBP/USD declined by 0.32% to 1.3261. Bank of England (BoE) MPC member Catherine Mann revealed she voted to keep rates unchanged last week, after previously advocating a 50 basis point cut in February, citing a stronger than expected UK labor market.

The Federal Reserve warned about rising economic uncertainty and signaled willingness to wait and assess the impact of new tariffs before making further rate decisions. FED Chair Jerome Powell is expected to deliver a speech on Thursday.

Key upcoming data includes April retail sales, also due Thursday, coinciding with Ukraine - Russia negotiations in Istanbul, aiming for a ceasefire after three years of conflict - Europe’s bloodiest war since World War II.

🔹 USDCAD: +0.33%

🔹 DXY: +0.09%

🔹 EURUSD: -0.09%

🔹 GBPUSD: -0.38%

🔹 USDJPY: -0.49%

🔹 AUDUSD: -0.65%

Commodities market

Gold prices fell sharply to their lowest level in over a month, as the U.S. - China tariff truce reduced the safe-haven appeal of the precious metal.

The probability of the Federal Reserve keeping interest rates unchanged in June is 91.7%, in July is 63.3%

On May 15, according to CME's "Fedwatch", the probability of the Federal Reserve keeping interest rates unchanged in June is 91.7%, and the probability of cutting interest rates by 25 basis points is 8.3%. The probability of the Federal Reserve keeping interest rates unchanged in July is 63.3%, the probability of cutting interest rates by 25 basis points is 34.2%.

🔹 BTCUSD: -0.58%

🔹 Brent: -0.94%

🔹 WTI: -1.29%

🔹 XAUUSD: -2.23%

• 🔹 Mixed market signals offer both risk on and risk off opportunities for Forex traders. Watch major indices for momentum cues.

• 🔹 USD stabilizing post sharp decline, supported by easing trade tensions. Monitor USD pairs such as EUR/USD, GBP/USD, and USD/JPY for volatility.

• 🔹 Gold’s sharp decline indicates reduced safe-haven demand; potential trading setups exist around technical support levels.

• 🔹 Oil price declines could weigh on commodity currencies like CAD and AUD, offering short-selling opportunities.

• 🔹 Upcoming FED speech and retail sales are key events that may cause increased volatility across Forex markets; employ proper risk management around these releases.

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