Posted at 18 August 2020 / Categories Market Roundups
Market Roundup
•US Jul Building Permits (MoM) 18.8%, 3.5% previous
•US Jul Building Permits 1.495M, 1.320M forecast, 1.258M previous
•US Jul Housing Starts1.496M, 1.240M forecast, 1.186M previous
•US Jul Housing Starts (MoM) 22.6%,17.3% previous
Looking Ahead – Economic Data (GMT)
•12:55 US Redbook (MoM) 2.5% previous
•12:55 US Redbook (YoY) -3.4% previous
•15:05 Russia Jul PPI (YoY) -8.3% previous
•15:05 Russia Jul PPI (MoM) 6.1% previous
•15:20 GlobalDairyTrade Price Index-5.1% previous
Looking Ahead - Events, Other Releases (GMT)
•No significant events
Fxbeat
EUR/USD: The euro strengthened on Tuesday as dollar slid on concern further U.S. fiscal stimulus could face political deadlock. The dollar dipped as a deadlock on further policy stimulus and concerns about escalating tensions between Washington and Beijing cast a shadow over the greenback’s medium-term outlook. The prospects of a weakening dollar and negative inflation-adjusted yields thanks to the Fed’s unprecedented stimulus measures in recent months have dented demand from investors in Japan and Europe in recent months. Immediate resistance can be seen at 1.1929 (23.6% fib), an upside break can trigger rise towards 1.1100 (Psychological level).On the downside, immediate support is seen at 1.1848 (5DMA), a break below could take the pair towards 1.1806 (38.2%fib).
GBP/USD The pound rose to five-month high against the dollar on Tuesday as pound was driven by higher by weakness in the U.S. currency, but investors remained cautious about the outlook for sterling as a new round of Brexit talks began. The dollar index hit new lows on Tuesday, facing the triple woes of diminishing yields, weak U.S. economic data and a lessening of demand for safe havens. Meanwhile, traders are braced for a fresh round of sterling volatility as talks between Britain and the European Union restart. Immediate resistance can be seen at 1.3200 (23.6%fib), an upside break can trigger rise towards 1.3283(Jan 31st high).On the downside, immediate support is seen at 1.3100 (Daily low), a break below could take the pair towards 1.3000 (Psychological level).
USD/CHF: The dollar declined against the Swiss franc on Tuesday after a triple blow of retreating yields, soft U.S. economic data and a dip in safe-haven demand exerted broad selling pressure. Investors have been relieved by a delay in the review of the U.S.-China trade deal this week, which has left the agreement standing and reinforced a belief the trade relationship can hold even amidst conflict on multiple other fronts.A fresh rally in tech stocks added to the positive mood, and together with a pullback in U.S. yields and a weak reading in a U.S. manufacturing survey has many traders sticking to their bearish convictions on the dollar. Immediate resistance can be seen at 0.9056 (23.6%fib), an upside break can trigger rise towards 0.9080(5 DMA).On the downside, immediate support is seen at 0.9015 (Lower BB), a break below could take the pair towards 0.9000 (Psychological level).
USD/JPY: The dollar dipped against the Japanese yen Tuesday as weaker dollar fuelled demand for safe haven yen. The dollar fell to a fresh two-year low against its rivals on Tuesday as a deadlock on further policy stimulus and concerns about escalating tensions between Washington and Beijing cast a shadow over the greenback’s medium-term outlook. Moves were generally cautious ahead of Wednesday’s release of the Federal Reserve minutes, with speculation that the Fed will adopt an average inflation target, which would seek to push inflation above 2% for some time. Strong resistance can be seen at 105.52 (38.2%fib), an upside break can trigger rise towards 105.98(5 DMA).On the downside, immediate support is seen at 105.00 (Psychological level), a break below could take the pair towards 104.58(Lower BB).
Equities Recap
European shares pared early losses on Tuesday as travel stocks rebounded, but rising U.S.-China tensions and underwhelming earnings report from mining group BHP weighed on sentiment.
At (GMT 12:20 ),UK's benchmark FTSE 100 was last trading up at 0.03 percent, Germany's Dax was up by 0.40 percent, France’s CAC was up 0.13 percent.
Commodities Recap
Gold rose 1% on Tuesday, climbing back above the $2,000 level breached earlier this month, as the dollar touched a more than two-year low and investors awaited details of the U.S. Federal Reserve’s strategy to combat a pandemic-induced economic slump.
Spot gold climbed 1.1% to $2,006.84 per ounce by 1010 GMT, having earlier hit a one-week high of $2,009.89. Gold first broke the record $2,000-level early in August.U.S. gold futures were up 0.8% at $2,015.30.
Oil prices were broadly steady on Tuesday, hanging on to gains from the previous session thanks to high compliance with production cuts from members of the OPEC+ producer group.
Brent crude eased by 9 cents, or 0.2%, to $45.28 a barrel by 1117 GMT, having gained 1.3% on Monday. U.S. crude edged down by 17 cents, or 0.4%, to $42.72 after a rise of 2.1% in the previous session.
Treasuries Recap
German government bond yields fell for a third consecutive session on Tuesday with European debt a major beneficiary of a broadly weaker dollar fuelling demand for fixed income assets elsewhere.
Benchmark German government debt yields edged one basis point lower to minus 0.467%, a three-day low. Other core European debt yields, including on French and Belgian bonds, also slipped