Market wrap: US rates and dollar extend gains - Westpac

Analysts at Westpac offered their market and economic wrap.

Key Quotes:

"Global market sentiment: US interest rates and the US dollar extended recent gains, partly helped by strong economic data. The S&P500 made a fresh record high.

Interest rates: US 10yr treasury yields rose from 2.25% to 2.29% and 2yr yields rose from 1.35% to 1.37%. Fed fund futures yields were little changed, pricing the chance of a December rate hike at around 43%.

Currencies: The US dollar index is up 0.3% on the day, having risen after the second-tier but strong JOLTS job openings report. EUR fell from 1.1820 to 1.1715. USD/JPY fluctuated between 110.25 and 110.85. AUD fell from 0.7943 to 0.7887 but later recovered to the low 0.79s. NZD underperformed yet again, probably reflecting the looming RBNZ meeting, falling from 0.7370 to 0.7318. AUD/NZD extended the multi-week rally from 1.0760 to 1.0806.

Economic Wrap

US job openings (JOLTS) jumped higher in June, from 5702k to 5666 – well above expectations at 5750k, and a record high. The quit rate – watched by Fed chair Yellen - fell to 2.1% from 2.2%, taking a bit of the gloss off the report (although it has been choppy this year). Overall, the solid report is consistent with other labour market indicators."