Posted at 22 July 2020 / Categories Market Roundups
Market Roundup
• Euro continues to ride optimism on stimulus
• Global coronavirus cases exceed 15 million
• Dollar down against most currencies
• U.S. Republicans and Democrats tussle over fiscal spending
• Canada June Core CPI (YoY) 1.1%,0.9% forecast, 0.7% previous
• Canada June CPI (MoM) 0.8%, 0.4% forecast,0.3% previous
• Canada June Core CPI (MoM) 0.4%, -0.1% previous
• Canada Trimmed CPI (YoY) 0.4%, 1.7% previous
• Canada Median CPI (YoY) 1.9%, 1.9% previous
• Canada Common CPI (YoY) 1.5%, 1.4% previous
• Canada June CPI (YoY) 0.7%, 0.3% forecast,-0.4% previous
• US May House Price Index (YoY) 4.9% , 5.5% previous
• US May House Price Index 287.3, 288.3 previous
• US May House Price Index (MoM) -0.3%, 0.2% previous
• US Existing June Home Sales 4.72M, 4.78M forecast, 3.91M previous
• US Existing June Home Sales (MoM ) 20.7%, 24.5% forecast, -9.7% previous
• US Gasoline Inventories -1.802M, -1.386M forecast, -3.147M previous
• US Crude Oil Inventories 4.892M, 4.892M-2.088M forecast, -7.493M previous
Looking Ahead - Economic Data (GMT)
• 23:50 Japan Foreign Investments in Japanese Stocks 67.2B previous
• 23:50 Japan Foreign Bonds Buying 1,065.7B previous
•01:30 Australia NAB Quarterly Business Confidence-11 previous
Looking Ahead - Economic events and other releases (GMT)
• No significant events
Currencies Summaries
EUR/USD: The euro rose to its highest in nearly two years against dollar Wednesday after European leaders agreed a stimulus plan to fuel recovery from the economic damage caused by the COVID-19 pandemic. Investors also expect a massive amount of fiscal spending to support growth in major economies but could easily be disappointed if any stimulus falls short of expectations. The common currency hit $1.1547 on Wednesday, its best since January 2019. Immediate resistance can be seen at 1.1585 (Daily high), an upside break can trigger rise towards 1.1614 (23.6% fib).On the downside, immediate support is seen at 1.1504 (Daily low), a break below could take the pair towards 1.1494(38.2% fib).
GBP/USD: The British pound fell on Wednesday on growing concern that the Brexit transition period will end without a deal between Britain and the EU, and on the foggy economic prospects for the country as it looks to emerge from its coronavirus lockdown. Brexit has taken a back-seat during the pandemic, but with a transition period set to expire at year-end, the clock is ticking for Britain to reach a trade deal with the bloc. London wants free trade but is prepared for no deal, Transport Secretary Grant Shapps said on Wednesday. Immediate resistance can be seen at 1.2746 (Daily high), an upside break can trigger rise towards 1.2857 (23.6% fib).On the downside, immediate support is seen at 1.2642 (Daily low), a break below could take the pair towards 1.2600 (38.2 %fib).
USD/CAD: The Canadian dollar rose to a near-six-week high against its U.S. counterpart on Wednesday, after data showed Canada's annual inflation rate in June poste its biggest acceleration in more than nine years The inflation rate spiked as restrictions imposed to curb the coronavirus outbreak were lifted, Statistics Canada said on Wednesday .Immediate resistance can be seen at 1.3428 (23.6% fib), an upside break can trigger rise towards 1.3471 (5MA).On the downside, immediate support is seen at 1.3399 (Daily low), a break below could take the pair towards 1.3314 (June 10th low).
USD/JPY: The dollar edged higher against the Japanese yen on Wednesday as unease around the next round of economic stimulus in the United States kept the U.S. dollar subdued. The greenback clawed back earlier losses and inched higher after China said the United States had abruptly told it to close its consulate in the city of Houston, stoking more tension between the countries. Broader risk appetite has improved this week amid progress in developing vaccines for the novel coronavirus and a historic stimulus deal in Europe, reducing the greenback's safe-harbour appeal. Strong resistance can be seen at 107.05 (5 DMA), an upside break can trigger rise towards 107.50 (50% fib).On the downside, immediate support is seen at 106.50 (Lower BB), a break below could take the pair towards 106.00 (Psychological level).
Equities Recap
European shares slid on Wednesday as escalating U.S.-China tensions and a surge in coronavirus cases dented sentiment after an EU-wide debt deal sent the region’s markets to four-month highs in the previous session.
UK's benchmark FTSE 100 closed down by 1.00 percent, Germany's Dax ended down by 0.52 percent, France’s CAC finished the day up by 1.32 percent.
U.S. stock indexes gained on Wednesday as investors digested mixed quarterly results, stimulus negotiations in Washington and simmering U.S.-China tensions.
Dow Jones closed up by 0.62% percent, S&P 500 closed up by 0.57 % percent, Nasdaq settled up by 0.24% percent.
Treasuries Recap
U.S. Treasury yields fell on Wednesday as the market awaited an auction of $17 billion of 20-year bonds and watched for developments on a new round of federal aid for the coronavirus-hit economy.
The benchmark 10-year yield was last down 2.1 basis points at 0.5856%, while the 20-year bond yield tumbled as low as 1.05%.
Commodities Recap
Gold surged to a nine-year peak on Wednesday on bets that central banks would introduce more stimulus measures to ease the economic impact of coronavirus, while silver scaled a near seven-year high on hopes of a rebound in industrial activity.
Spot gold hit its highest since September 2011 in early trade at $1,865.35, and by 1113 GMT was up 0.9% at $1,858.39 per ounce. U.S. gold futures were 0.9% higher at $1,859.60.
Oil prices fell on Wednesday as U.S. government data showed a surprise rise in U.S. crude inventories, and as tensions escalated between the United States and China.
Brent crude fell 55 cents, or 1.2%, to $43.77 a barrel by 10:56 EST (1456 GMT). U.S. West Texas Intermediate (WTI) crude dropped 56 cents, or 1.3%, to $41.36.