The Nasdaq and the S&P 500 reached heights at record levels on Thursday, while the broader equity market exhibited mixed performance. Despite a decline in Treasury yields following disappointing housing starts and jobless claims data, the US dollar continued to gain momentum. These gains were widespread, affecting European currencies amid rising expectations of central bank rate cuts and easing measures, as well as Japan's yen and China's yuan in Asia.

Asia Pacific Markets
The USD surged to nearly JPY 159.15, its highest level since late April. The US Treasury added Japan to its foreign exchange watchlist following recent interventions. The USD has risen for six consecutive sessions leading up to today, with Japanese officials ramping up their rhetoric on foreign exchange.
In Australia, the PMI slowed, with the composite index declining to 50.6 from 52.1, indicating easing in new orders and prices. The Australian dollar, which reached $0.6670 yesterday, struggled to extend its gains today, hovering in the middle of its $0.6600-$0.6700 range.

European Markets
Weak PMI data caused the euro to slump, testing last week's low near $1.0670. Both German and French PMIs weakened, with the aggregate composite falling to 50.8 from 52.2, ending Q2 on a weak note.
In contrast, the UK reported better-than-expected retail sales. Although the manufacturing PMI unexpectedly ticked higher (51.4 vs. 51.2), a surprising weakness in services (51.2 vs. 52.9) dragged the composite index down to 51.7 from 53.0. Consequently, sterling fell to about $1.2635, the lowest level since May 15, with resistance now seen around $1.2680.

American Markets
In the US, the flash PMI is expected to show a slight slowdown, with the composite index easing to 53.5 from 54.5. The index of leading economic indicators is anticipated to continue its decline, and existing home sales are expected to have fallen by 1.0% following a nearly 2% decline in April.
No Federal Reserve officials are scheduled to speak today.
The US dollar slipped to a two-week low near CAD 1.3675, approaching support near CAD 1.3660, marking a five-day decline.

In summary, while equity markets show mixed results, the US dollar continues to demonstrate broad-based strength against major currencies, influenced by varying economic indicators and central bank actions across regions.