Dollar holds gains; equity futures slip ahead of US services data

At the start of the North American trading week, the U.S. dollar is trading firmer against most major counterparts. Six of the seven main currencies are giving way to the greenback, with the Australian dollar the lone exception and slightly higher.

Stock futures are pointing to a lower open, while Treasury yields are barely moving. The next item on the calendar is U.S. services: the final S&P Global services PMI lands at 9:45 a.m. ET, followed at 10 a.m. ET by the ISM services report, which draws more attention.

Developments in the Middle East are still shaping the oil market. Better supply is helping, but energy infrastructure threats continue to present a risk.

The greenback is in a stronger position as the week opens.

The early snapshot for the dollar looks like this:

• NZDUSD: 0.5587, for a USD gain of 0.57%.

• EURUSD: 1.1204 as the dollar added 0.44%.

• USDCHF: 0.8311, with the greenback 0.30% stronger.

• USDJPY: 158.21, the dollar up 0.24%.

• GBPUSD: 1.3224, the U.S. currency ahead 0.13%.

• USDCAD: 1.4258, the dollar 0.08% firmer.

• AUDUSD: 0.6958, the USD 0.07% softer.

Against the greenback, the New Zealand dollar was the biggest loser, with the euro not far behind. The Australian dollar held up best, though the gain was marginal.

Foreign-exchange ranges as North American trading approaches

The morning data showed these trading ranges:

• EURUSD: 1.1162 to 1.1261, a 99-pip span.

• USDJPY: 157.45 to 158.28, an 83-pip band.

• GBPUSD: 1.3191 to 1.3250, covering 59 pips.

• USDCHF: 0.8278 to 0.8315, a 37-pip range.

• USDCAD: 1.4239 to 1.4293, 54 pips wide.

• AUDUSD: 0.6933 to 0.6966, a 33-pip gap.

• NZDUSD: 0.5585 to 0.5620, 35 pips between the extremes.

USDJPY is close to its high for the session, while NZDUSD is hugging its low. Both positions are signs of dollar strength as North American trading gets going.

For traders, those extremes serve as reference points. A breakout beyond them has to be sustained to extend the move. If a breakout fails soon after, the opposite side gets room to respond.

Stock futures are moving lower

The latest futures numbers indicate:

• Dow industrial average: 77 points lower.

• S&P 500: 6 points lower.

• Nasdaq: 66 points lower.

The declines are small, so the services numbers can still shape the mood at the open.

Treasury yields are barely moving

The Treasury figures supplied for the morning show:

• 2-year: 4.8205%, off 0.45 basis points.

• 5-year: 5.0554%, up 0.04 basis points.

• 10-year: 5.2771%, up 0.01 basis points.

• 30-year: 5.6310%, up 0.10 basis points.

Direction is scarce along the curve so far. Short-dated yields are down a touch, while the long end is basically flat.

The open question is whether today's services data will alter expectations around growth, inflation and the Fed's next decision.

Middle East: supply gains alongside infrastructure risk

InvestingLive's overnight coverage had oil edging lower, with recovering Middle East exports and a G7 stock release offsetting Houthi claims of attacks on Saudi Aramco sites. The allegations should not be mistaken for confirmed damage or lost production.

Separately, OPEC+ kept its November output targets unchanged at the group's Sunday meeting. InvestingLive said seven core members are still producing roughly 5 million barrels per day under their prewar output because of the Iran war.

For traders, real output and exports outweigh the published quotas. A recovery in shipments can loosen supply, but damage to energy infrastructure could unwind that improvement.

The inflation angle remains relevant. Lasting relief on energy costs would strengthen the inflation picture, while another supply hit would make life harder for central banks.

Overnight data: Europe's services sector holds above 50

European data on the calendar came in mixed:

• Spain services PMI: 58.3, above the 57.1 forecast and the prior 57.8.

• Italy services PMI: 51.7, short of the 54.6 forecast and the previous 55.2.

• France final services PMI: 51.2 versus 51.4 on both the forecast and the preliminary reading.

• Germany final services PMI: 52.9, in line with the forecast and the preliminary reading.

• Eurozone final services PMI: 53.0, also matching the forecast and the preliminary figure.

• UK final services PMI: 52.1, ahead of the 51.7 forecast and preliminary reading.

• Eurozone Sentix investor confidence: 2.7, down from the 4.5 forecast and the prior 5.1.

• Eurozone producer prices: up 1.9% month over month, in line with forecasts after a 1.6% increase previously.

Spain stood out, while Italy fell short. All of the listed economies kept services readings above the 50 expansion mark, though the Sentix drop signals weaker sentiment among investors.

Japan's consumer confidence came in at 35.4, compared with 35.3 expected and 35.5 before.

North American calendar: ISM services takes top billing

These are the main items due today:

• 9:45 a.m. ET — S&P Global final services PMI: 58.7 expected, unchanged from the preliminary 58.7.

• 10:00 a.m. ET — ISM services PMI: 55.1 expected against 55.4 prior.

The main ISM index is projected to slip a little while still resting comfortably above 50. The details, though, matter more than the headline.

Employment should clarify hiring conditions, new orders should signal demand, and prices paid should reveal whether companies still face meaningful cost pressure.

A solid top-line number with resilient employment and high prices would tell a different story than expansion propped up by activity while jobs and price pressures cool. Dig into the subcomponents, then watch whether yields and the dollar validate the market's first move.

Technical outlook

The technical read on the three major pairs — EURUSD, USDJPY and GBPUSD — looks at each pair's bias, the levels that define risk, and the targets that would give buyers or sellers extra control.

The ranges from the morning session offer a first map:

• EURUSD: at 1.1204, inside a 1.1162–1.1261 range. The pair has moved up from the low but remains down on the day, with the session extremes marking the levels to watch.

• USDJPY: at 158.21, just under the 158.28 high. Buyers came into the morning with the stronger hand, and a close above the high, with follow-through, would build on that.

• GBPUSD: at 1.3224, inside a 1.3191–1.3250 range. The pair is slightly weaker but off its low, giving a less clear read than USDJPY.

A session high or low is just a marker, not a full trade. Moving averages, swing zones and retracements help define spots where traders can act with defined, limited risk. News can provide the trigger, and price action then shows whether buyers or sellers keep control.