US STOCKS: Financials, Energy Pull Back But S&P Set To Edge Up To Record Close

Outside of Canada, analysts broadly expect a BOC hold through 2026 with hikes more of a 2027 prospect. 

• Aside from Citi's notable expectation of expecting the next move to be "lower rather than higher", JPMorgan explicitly sees rates held though 2027, while Wells Fargo anticipates a 25bp hike in July followed by a prolonged hold. See table for more details.

The Bank of Canada is unanimously expected to hold the overnight rate at 2.25% on Wednesday. MNI's full preview for the meeting will be published Tuesday.

• Analysts are almost unanimous on the next BOC move being a hike, with Citi a notable exception in seeing two rate cuts by year-end (25bp in September and October).
• The median among Canadian institution analysts is a hold through 2026, with 50bp of hikes in 2027. None see a cut.
• At either extreme of expectations: BMO expects rates to be held through the end of 2027; Scotiabank sees 75bp in hikes by end-2026; RBC sees a hold through 2026 followed by 100bp of hikes in 2027.

• RES 4: 161.95 High Jul 3 ‘24 and a major resistance
• RES 3: 161.46 1.618 proj of the Jan 27 - Feb  - 12 price swing
• RES 2: 160.79 1.500 proj of the Jan 27 - Feb  - 12 price swing
• RES 1: 160.03/160.46 High Apr 7 / High Mar 30 and the bull trigger
• PRICE: 159.29 @ 17:05 BST Apr 27
• SUP 1: 158.35/157.59 50-day EMA / Low Apr 17
• SUP 2: 157.16100-DMA 
• SUP 3: 156.46 Low Mar 5 
• SUP 4: 155.85 Low Mar 2 

USDJPY remains in consolidation mode. The trend is bullish - moving average studies are in a bull-mode position highlighting a dominant uptrend. Support around the 50-day EMA remains intact - currently at 158.35. A clear break of the average is required to signal a short-term reversal. Attention is on key resistance and the bull trigger at 160.46, the Mar 30 high. Clearance of it would resume the uptrend and open 160.79, a Fibonacci projection.