US manufacturing PMI rises to more than 2- year highs

Dollar, stocks rally as June data comes in better than market estimates..

Manufacturing PMI in the US rose to more than 2 year highs in June on the back of rise in employment, new orders and production. The monthly data released by ISM came in at a better than expected 57.8 from 54.9 in May. However, the index measuring inventories slipped to a 3- month low. Analysts’ were expecting the broader index to rise to 55.5 in June. A PMI above 50 is an indicator that the sector as a whole is expanding while a reading below 50 is a sign of contraction.

The dollar extended its gains versus the majors with the EURUSD settling at 1.1360, down 0.55 percent to complete the second straight session in the negative, while the Sterling closed to a 3- session low at 1.2936 or 0.68 percent.  The Japanese yen was the biggest loser with a 0.90 percent decline as the Asian currency ended Monday’s session at 113.37, the lowest level since mid- May. The dollar index settled above 96.00 for the first time in 4 sessions.

The US stock markets too joined the party with the Dow hitting fresh all- time highs of 21562 before ending Monday’s session at the highest point in 2 weeks and the S&P giving back most of the session gains to end flat at 2429, in a shortened trading day.

US markets remain closed on Tuesday as the country celebrates Independence Day.

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