RBA Holds Rates, US Retail Sales Ahead

The Reserve Bank of Australia maintained its interest rates, highlighting ongoing price pressures similar to those experienced globally. In the United States, market participants anticipate retail sales data for May and are preparing for speeches from six Federal Reserve officials which could indicate future monetary policy adjustments.

Equities

The FTSE 100 closed slightly down by 0.1% on Monday, marking a continuation of its downturn for the third consecutive session.

Superdry saw a significant surge, climbing 10% following the court's approval of its restructuring plan. Hochschild Mining was another standout, with its shares increasing by 3.3% after BMO reinstated an "outperform" rating on the stock. Crest Nicholson saw shares rise by 2.6% after Peel Hunt upgraded its rating to "Add" from "Hold".

Across the Atlantic, the US stock markets showed a more upbeat trend, with the S&P 500 and Nasdaq reaching record closing highs.

Autodesk jumped 6.48% after reports that activist investor Starboard Value had acquired a significant stake worth approximately $500 million in the software company. Broadcom and Taiwan Semiconductor Manufacturing Co also posted strong gains of 5.41% and 2.74%, respectively.

Apple's shares climbed by 1.97%, continuing their upward trajectory from the previous week following announcements of new AI-driven features intended to boost iPhone demand. Microsoft shares also rose by 1.31%, reflecting a positive reception from investors.

Despite the general optimism in tech, Nvidia saw a slight retreat, shedding 0.66% even after touching record highs earlier.

Forex & Commodities

On Tuesday, the US dollar index rose slightly by 0.11% to 105.39. This movement comes as markets anticipate key US retail sales data and insights from Federal Reserve officials, which could provide further clarity on the potential for interest rate cuts. The euro saw a minor decline, dropping 0.12% to $1.0721, while the British pound also edged down by 0.07% to $1.2696.

Gold prices responded to the softer US Treasury yields, with spot gold increasing by 0.1% to $2,320.60 per ounce. This increase is linked to expectations that the Federal Reserve may cut its benchmark interest rate once this year, making non-yielding assets like gold more appealing. The financial markets are closely monitoring upcoming comments from New York Fed President John Williams and Fed Governor Lisa Cook for additional signals on the direction of US monetary policy.

In the oil markets, Brent crude futures slightly decreased by 0.14% to $84.13 per barrel, while US West Texas Intermediate crude dropped by 0.17% to $80.19 a barrel. These movements reflect cautious market sentiment regarding global demand growth and potential impacts of further supply adjustments by OPEC+. Analysts highlight a slowing in oil demand growth and suggest that recent price movements are supported by complex refining margins and strategic supply management by OPEC+.