UK unemployment data and US retailers reporting

FTSE =>The index rises over 7500
Walmart => The stock trades down 9% this year
USD/CAD => The pair falls to 1.29

FTSE rises ahead of jobs data

The FTSE ended yesterday just 0.1%. higher as gains in AstraZeneca offset weakness in commodity stocks following disappointing data from China. Today, the index is extending those gains after a solid session on Wall Street, and soaring commodity prices lift profits to the best in 11 years. In addition to commodity stocks, the focus will also be on the UK economic calendar with the release of UK jobs data. Expectations are for unemployment to remain steady at low levels and earnings ex- bonus to tick higher to 4.5% from 4.3%. This is still well below inflation which is over 9% and highlights the deepening cost of living crisis.

Where next for FTSE?

FTSE has extended its rebound from 7000, the mid-July low, rising above the 20& 50 sma and resistance at 7500. The 20 sma crossed above the 50 in a bullish signal, and the RSI is supportive of further upside. Buyers have run into resistance at 7545. A break above here is needed to continue higher towards 7600 round number and 7645, the June high. Failure to push higher could see the price test immediate support at 7500 ahead of 7450 last week’s low and 7415 the 20 sma. It would take a move below 7350 to negate the near-term uptrend.

Walmart Q2 earnings preview

Walmart, America’s largest retailer, is to report Q2 earnings today before the market opens. The street is expecting EPS of $1.63 on revenue of $15.93 billion. The results come after Walmart warned just two months ago that EPS could fall by as much as 13% in the current fiscal year as shoppers change their shopping habits as the cost-of-living crisis deepens. Big ticket items are expected to fall, while shoppers instead focus on less profitable groceries. The earnings report will provide clues on consumer spending trends. Walmart is also expected to shed some light on efforts to get rid of high inventory levels. The stocks trade 9% lower year to date.

USD/CAD looks to inflation data

USD/CAD surged 1T% higher in the previous session owing to safe haven flows and tanking oil prices. Weaker than forecast data from China raised concerns over growth in the world’s second-largest economy, fueling demand for the safe haven USD while also hurting the demand outlook for oil. Oil, Canada’s main export, fell to $86.86, a level last seen in early February before Russia invaded Ukraine. Today the pair is edging lower as attention turns to Canadian inflation data, which is forecast to tick lower in July. This could raise optimism that peak inflation is passing in the region and take pressure off the BoC to act aggressively at the next meeting after a jumbo-sized 1% hike in July.

Support can be found at 1.2860 (20 sma) and 1.28 (round number).

Resistance for the index can be seen at 1.2930 (yesterday’s high) and 1.2985 (August high).