The overriding factor affecting US markets on Friday was the much-awaited House vote on Trump`s health care bill, which was the canceled as it lacked enough votes, sending the Trump administration back to the drawing board. US equities closed the session mixed as we saw swings from negative to positive and back again as market awaited the final news on the vote which will affect fiscal policy at large. The DJIA lost 0.28%, the NASDAQ 100 lost gained 0.17% while the S&P 500 lost 0.08%.
In FX, the USD also felt the brunt of the Vote Pressure, and was hammered lower as we saw the USD Index, a measure of the strength of the USD against a basket of currencies, find stern resistance at the key 100 level before bears took the USD lower. The USDJPY has extend on its 2017 lows, pushing deeper into 2016 territory in a mix of USD softness and a flight of capital to the relative safety of the JPY. The GBP and EUR also benefited against the USD, reclaiming the 1.2500 and 1.0800 handle respectively, partly dues to weakening of the USD and partly due to political factors of their own, specifically the GBP which is bid ahead of the historic triggering of article 50 this week. Markets have adopted the sell the rumor by the fact strategy as we see the GBP recover off its lows, pushing higher.
In commodities, crude oil remains subdued below $50 a barrel with uncertainty regarding the extension of oil supply freezes by OPEC and non-OPEC members alike. If an extension is agreed upon, we will see crude pop higher as market price in the decreased supply while uncertainty regarding a supply freeze will continue to weigh on the commodity. Gold managed to pop higher, taking out the 1250 resistance level as uncertainty grows and the USD weakens across the board. Gold will continue higher so long as Trump struggles to pass his vote, which will see the USD continue to weaken and uncertainty rises.