- US stocks close the day mixed with the Dow up, S&P unchanged and the Nasdaq modestly lower.
- Crude oil futures settled at $82.61
- US Treasury sells $70B of 5 year notes at a high yield of 4.408%
- Trump: On Iran, I have plenty of time
- Pakistani Intelligence: U.S. May Be Considering Limited Ground Operation in Iran
- US treasury sells $69 billion of 2 year note at a high yield of
- Trump: I am not to give much time to negotiations – either it will move quickly or won’t happen at all.
- Heads Up. There will be 2 coupon auctions today ahead of the Fed Decision on Wednesday
- US advanced Durable Goods orders for June 0.3% vs 2.5% expected
- The USD is mostly lower to kickstart the new trading week in North America
- investingLive European session wrap: Oil stumbles as markets cling on to US-Iran de-escalation hopes
The markets are not taking the bait from oil prices plunging by over $7 in trading today as hope springs eternal for peace in the middle east.
The U.S. dollar ended the day mixed/ mostly higher, shrugging off a sharp decline in crude oil prices, and modestly lower US yields. Normally, moves to the downside in oil would weaken the greenback and lead to sharply lower yields, but traders seem to be keeping their eye’s on this week’s Federal Reserve decision. Yield held relatively steady, allowing the dollar to remain supported ahead of what is expected to be a cautious, and potentially hawkish message from the Fed. Moreover the market is not 100% of no change in policy with a 37% chance for a hike of 25 basis points. For September, the odds are 55% for a hike. So there is some tilt to the upside.
The decline in oil was helped by geopolitical tensions easing modestly The U.S. and Iran paused direct military strikes, while President Trump said talks with Iran are underway. However, traders remain wary as risks persist. We have been down this road before. Those lingering risks helped keep the dollar underpinned despite the collapse in oil prices. Crude oil prices are trading down -$7.48 at $81.88.
In economic news, U.S. durable goods orders rose 0.3% in June, well below the 2.5% increase expected, signaling that manufacturing demand was softer than economists anticipated. The report follows a downwardly revised 4.0% decline in May (from -4.5%), highlighting continued volatility in the series, which is often influenced by large transportation orders.
Despite the weak headline, the underlying details were more constructive:
- Headline durable goods orders:+0.3% vs. +2.5% expected.
- May orders: Revised to -4.0% from -4.5%.
- Durable goods ex-transportation:+0.6% vs. +0.8% expected, indicating demand outside the volatile transportation sector remained positive, although slightly below forecasts.
- Durable goods ex-defense:+0.3%, improving sharply from -4.3% in May.
- Nondefense capital goods excluding aircraft (core capital goods):+0.9% vs. +0.8% expected, following a +1.9% gain in May.
The strongest takeaway came from core capital goods orders, which are widely viewed as a proxy for business investment. Although the pace slowed from May, the gain exceeded expectations and suggests companies continue to invest in equipment despite elevated interest rates and economic uncertainty.
Overall, while the headline was disappointing and may temper enthusiasm about manufacturing momentum, the strength in core capital goods provides a more encouraging signal that business spending remains relatively healthy. Traders should also remember that durable goods data are frequently revised, with another update coming in the Factory Orders report next month, which can materially change today’s initial readings.
Among the major currencies, the Swiss franc was the weakest performer after reports that the Swiss National Bank is expected to keep interest rates at 0% through the end of 2027. The report sent USDCHF to fresh year-to-date highs as traders priced in a prolonged period of ultra-accommodative Swiss monetary policy. The price high reached 0.8193 put the price in the middle of the upside target defined by swing highs going back to June to August of 2025 between 0.8171 and 0.8214, and including the 38.2% of the move down from the 2024 high a 0.82116. Getting above those levels would open the door for further gains in the pair.
The GBPUSD fell below the lows from last week beloe 1.3304 to a low of 1.3285. The price also fell below the 61.8% of the move up from the June 2026 low at 1.3299. If the price can stay below the 1.3304 level in the new day, the sellers would remain in firm control.
The AUDUSD is off it’s high but remains on higher on the day vs the greenback. The currency pair benefiting from firmer gold prices with gold prices trading up $34 or 0.84% at $4086.50. THe price is trading just below the near converged 100 and 200 hour MAs near 0.6993. That will be a key barometer for buyers and sellers in the new trading day.
The NZDUSD moved higher in the Asian Pacific session and found willing sellers against the 100 hour MA (currently at 0.5798 and moving lower). On the downside, the pair has swing area support at 0.5765. If the price can break below that level and remain broken, the next target is at 0.5742 followed by 0.5719 to 0.5726.
The USDJPY frell earlier in the day to a low of 163.34 and tested the rising 100 hour MA there. The buyers at the MA level (the current MA is at 163.47) pushed the price higher and reached a new high for the day in the North American session at 163.79. The inability to move below that MA increases that MAs importance. Staying above it is more bullish. Move below it in the new day is more bearish. The 40 year high is at 163.98 reache last week. Additional targeted resistance is at 164.50.
The EURUSD tested its 100 hour MA on the earleir run higher at 1.1418 and found willing sellers. The move lower retraced the gains from Friday’s close and reached 1.1368. The price is just above that level at 1.1371. A move below the low from last week at 1.13616 would add to the bearish bias for the pair.
In other markets today, the US stocks are cloing mixed after gains were chewed away in the Nasdaq. The S&P closed virtually unchanged, while the Dow closed higher. A snapshot of the close shows:
- Dow industrial average up 263 points ro 0.51% at 52215.23
- S&P rose 1.20 points or 0.02% at 7413.17
- Nasdaq fell -43.74 points or -0.18% at 24932.08. The Nasdaq traded as high as +286.09 at session highs.
U.S. Treasury yields are lower across the curve as investors continue to favor bonds following softer-than-expected economic data, including this morning’s weaker headline durable goods report. The decline in yields also reflects a more cautious tone ahead of this week’s key events, including the Fed policy decision. The US treasury autioned 2 and 5 year notes today with the 2 year attracting solid demand while the 5 year, not so great buying interest.
- 2-year yield: 4.320% (-1.1 bps) – Most sensitive to Fed policy expectations.
- 5-year yield: 4.402% (-2.4 bps).
- 10-year yield: 4.649% (-3.0 bps) – Benchmark yield extends its decline.
- 30-year yield: 5.133% (-2.9 bps).
Looking ahead, all eyes now turn to Wednesday’s Federal Reserve decision, which will likely set the tone for the U.S. dollar, Treasury yields, and broader financial markets for the remainder of the week. With markets already expecting rates to remain unchanged, the focus will be squarely on Chair Kevin Warsh’s guidance and any changes to the Fed’s policy outlook.
For today, the bait looked good with oil prices down sharply, but the markete did not bite.
This article was written by Greg Michalowski at investinglive.com.