investingLive Americas FX news wrap 2 Sept: USD mixed, stocks rise as Iran tensions simmer

US stocks rise as small caps lead the gainsEURUSD Technicals: Traders have done their ABCs in trading the EURUSD today. What do I mean?Fed Beige Book: Modest growth, moderate inflationThe political headlines are fast and furious coming out of WashingtonBitcoin technicals: The price of bitcoin is back below the 100/200 hour MA and making new corrective lowsTrump: Maybe the Strait of Hormuz should be renamed the Trump Strait?Bank of Canada Governor Macklem answers questions after BOC rate decision. What are the implications?Crude oil technical analsysis: US crude oil inventories for -4.450M barrel vs -1.085M estimate.US factory orders for the month of July 0.9% versus 0.6% expectedThe Opening Statement from BOC TIff Macklem by topic. What are the implications for traders?Bank of Canada keeps rates unchanged at 2.25%.Will the Fed raise rates in September?The USD is mixed vs the EURUSD, USDJPY and GBPUSD. What traders should eye technically?investingLive European session wrap: Higher bond yields continue to keep markets on edgeThe USD is ending the day mixed, trading lower against the JPY, CAD and AUD, but higher against the EUR, GBP, CHF and NZD. The yen led the gains, with USDJPY down around 0.80%, helped by hawkish comments from BOJ policymaker Takata and Treasury Secretary Bessent’s remark that he knows what the Japanese are planning. USDCAD fell around 0.40% after the Bank of Canada held rates at 2.25% but warned that inflation risks have increased. That pushed market expectations toward a greater chance of a rate hike later this year. The AUD also moved higher, gaining around 0.32% against the greenback.The NZD was the weakest performer, falling around 0.73% against the USD despite the RBNZ raising rates by 25 basis points to 2.75%. The hike was expected, but the bank’s projected path for future rates was lower than markets had priced in. Putting it another way, the RBNZ raised rates, but did not deliver enough to satisfy traders looking for a more hawkish outlook. Elsewhere, the USD gained around 0.23% against the GBP, 0.17% against the CHF and 0.07% against the EUR. On the US side, New York Fed President John Williams supported the previous decision to hold rates steady, with incoming data guiding the next move. Attention now turns toward Friday’s US jobs report, while geopolitical headlines remain a key influence as well.  Ahead of the jobs report, the ADP report released today showed US private employers added 38,000 jobs in August, below expectations for 48,000 and down from a revised 46,000 in July, pointing to a subdued hiring backdrop ahead of Friday’s jobs report.  ADP noted it was the slowest pace of hiring since January Education and health services led the gains, adding 45,000 jobs, with construction and leisure and hospitality also contributing, while manufacturing and professional services shed jobs. Annual base-pay growth was 3.0% for workers staying in their jobs and 4.7% for those switching employers. Overall, the report points to a labor market that continues to add jobs, but with hiring concentrated in a limited number of industries.. Friday’s US jobs report is expected to show a modest rebound in hiring, with the unemployment rate holding steady and monthly wage growth picking up. Based on the forecasts provided:Nonfarm payrolls: Expected to rise by 55,000, following a 23,000 decline in the previous month. Unemployment rate: Expected to remain unchanged at 4.1%. Average hourly earnings: Expected to increase 0.3% month over month, up from 0.1% previously. The key is the combination of soft hiring and firmer wage growth. A return to positive payroll growth would be welcome, but a 55,000 gain would still suggest a subdued pace of hiring. Meanwhile, faster wage growth could signal lingering inflation pressure. Revisions to previous payroll figures will also help determine whether the underlying jobs picture is improving or weakening.US Treasury yields moved modestly lower across the curve, with shorter-term yields falling more than longer-term yields. The 2-year yield declined around 1.7 basis points, while the 30-year slipped just 0.5 basis points, resulting in a modest steepening of the yield curve. The 10-year yield remained above the 4.75% level despite the pullback.2-year yield: 4.377%, down 1.7 basis points.5-year yield: 4.545%, down 1.3 basis points.10-year yield: 4.788%, down 0.8 basis points.30-year yield: 5.262%, down 0.5 basis points.US stocks closed higher, with buying spreading beyond the largest technology names. The Russell 2000 led with a 1.13% gain, more than double the advances in the S&P 500 and Nasdaq Composite. The Nasdaq 100 lagged, rising 0.23%, as sharp declines in selected technology shares limited its upside.Dow industrials: 53,067.32, up 295.05 points or 0.56%. S&P 500: 7,666.69, up 35.21 points or 0.46%. Nasdaq Composite: 26,217.83, up 118.05 points or 0.45%. Russell 2000: 2,953.18, up 33.05 points or 1.13%. Nasdaq 100: 29,143.33, up 66.11 points or 0.23%. Dell was the standout winner, surging 15.27% after beating earnings expectations and raising guidance. Nvidia gained 3.19% and Oracle added 3.29%. Fintech also attracted buyers, with Block up 5.96%, SoFi rising 4.90% and PayPal gaining 3.65%. Strength extended into consumer and industrial names, including Best Buy (+5.40%), United Airlines (+3.98%) and Deere (+3.35%).However, it was far from an across-the-board rally. Cybersecurity shares came under pressure, led by Palo Alto Networks (-9.30%), CrowdStrike (-5.44%) and Fortinet (-4.54%). Credo Technology plunged 20.02% following earnings, while Datadog fell 6.56%, Palantir lost 5.80% and Snowflake declined 4.12%.Buyers had the upper hand overall, and small-cap leadership was an encouraging sign of broader participation. But the sharp split among technology stocks showed that investors remained selective.US factory orders rose 0.9% in July, above the 0.6% estimate, while June’s decline was revised to 0.2% from 0.3%. Durable goods orders increased 1.1%, unchanged from the preliminary reading and stronger than June’s 0.5% gain. However, excluding transportation, orders rose a more modest 0.4%, slowing from 1.1% the previous month.The softer spot was business equipment demand. Nondefense capital goods orders excluding aircraft—a key indicator of business investment plans—were unchanged, revised down from a preliminary 0.2% increase, after rising 1.7% in June. Overall, the headline beat was encouraging, but the details showed uneven strength. Manufacturing demand improved, while businesses took a breather on new equipment orders.Crude oil futures are trading at $90.50 which is up $0.27 on the day. The high-priced was at $92.29 while the low price was down at $88.97. Venezuela’s oil sector was back in focus today after Chevron announced plans to invest more than $7 billion over five years, aiming to roughly double production from its Venezuelan ventures to 600,000 barrels per day by 2031. The expansion includes additional acreage in the Orinoco Belt and improved investment terms. Separately, Energy Secretary Chris Wright projected that new agreements could more than double Venezuela’s overall oil production over the next few years, from roughly 1.1–1.2 million barrels per day currently. HMMMM.  Trump has touted the broader Venezuela oil agreement as a way to substantially lower US gasoline prices. However, those benefits remain a longer-term prospect: analysts say restoring the country’s deteriorated infrastructure will require years of work and substantial investment. For oil traders, the announcements point toward more supply down the road, with the timing and scale of that increase still uncertain. The rise in oil prices today in the face of such positive news tells traders what the market is thinking.  Middle East tensions remained elevated today as the US and Iran engaged in their largest exchange of attacks since July. US forces struck Iranian military sites along the southern coast, while Iran retaliated against US bases in Bahrain, Jordan, Kuwait and Iraq. US officials reported no American casualties. Trump continued to portray the Strait of Hormuz as under US control, even suggesting renaming it “Trump Strait,” despite continued threats to shipping. Separately, US officials said American forces struck two Iranian government tankers under a new “tanker for tanker” policy, escalating the response to attacks on commercial vessels. For markets, the concern remains whether further fighting will disrupt energy shipments and keep inflation pressures elevated. Saudi Arabia called for a reduction in the military action and a return to diplomatic solutions.  This article was written by Greg Michalowski at investinglive.com.