Macro Roundup (May 9)

SHANGHAI, May 9 —This is a roundup of global macroeconomic news last night and what is expected today.

The dollar index pared gains Friday after hitting a new 20-year high, as traders weighed a recent global market sell-off stoked by recession fears.

European stocks were lower following a rout on Wall Street.

The U.S. currency has stood tall on expectations the Federal Reserve will tighten monetary policy faster than peers to stem runaway inflation.

The U.S. added 428,000 jobs in April, which was slightly more than the 400,000 expected by the Dow Jones.

The dollar index, which tracks its performance against a basket of six major rivals, gained as much as 0.5% in early European trading hours to hit a fresh 20-year high of 104.07.

Stock futures fell on Sunday evening as traders looked for the market to find its footing after a dramatic week of trading.

Futures tied to the Dow Jones Industrial Average dropped 218 points, or 0.7%. S&P 500 futures shed 0.8%, while those for the Nasdaq 100 lost 0.8%.

Last week, the Nasdaq Composite lost 1.54%, while the S&P 500 and Dow dropped 0.21% and 0.24%, respectively. It was the sixth straight losing week for the Dow, and the fifth straight for the other two major indexes.

While the cumulative moves for the week were not out of the ordinary, some of the day-to-day swings were eye-popping. The Dow had its best day since 2020 on Wednesday, but then erased all those gains and more on Thursday.

Oil prices climbed for a third straight session on Friday, shrugging off concerns about global economic growth as impending European Union sanctions on Russian oil raised the prospect of tighter supply.

Brent futures rose 1.75%, or $1.94, to $112.83 per barrel, while U.S. West Texas Intermediate (WTI) crude advanced 1.83% to $110.24 per barrel.

Brent and WTI are on track to rise for a second week in a row, buoyed by the EU’s proposal to phase out supplies of Russian crude oil in six months and refined products by the end of 2022. It would also ban all shipping and insurance services for transporting Russian oil.

The EU is tweaking its sanctions plan in a bid to win over reluctant states, three EU sources told Reuters on Friday.

Gold prices were higher on Friday but looked set for a third straight weekly loss as the U.S. dollar and Treasury yields rallied on a hawkish U.S. Federal Reserve stance.

Spot gold rose 0.2% to $1,880.86 per ounce but was still down about 0.8% for the 1-week period. U.S. gold futures climbed 0.3% to $1,882.

There are several opposing catalysts at play for gold in the likes of a tight monetary outlook driving bond yields and a stronger dollar, and that is being pitted against stagflation risks boosting its safe-haven status and appeal as an inflation hedge, according to Yeap Jun Rong, a market strategist at IG.

The pan-European Stoxx 600 fell 1.6% by the close, with retail stocks shedding 2% as almost all sectors and major bourses finished in negative territory. Oil and gas stocks gained 0.7%.