Posted at 24 August 2020 / Categories Market Roundups
Market Roundup
•Jackson Hole summit is this week’s main event
•U.S.-China tension remain a risk factor
•Four-day Republican National Convention begins
•US Jul Chicago Fed National Activity 1.18, 4.11
• French 3-Month BTF Auction -0.606%,-0.571% previous
• French 12-Month BTF Auction -0.578%,-0.571% previous
• French 6-Month BTF Auction-0.568%. -0.605% previous
• US 3-Month Bill Auction 0.100%,0.105% previous
• US 6-Month Bill Auction 0.120%,0.120% previous
Looking Ahead – Economic Data (GMT)
•05:00 Japan BoJ Core CPI (YoY) 0.1% previous
Looking Ahead - Events, Other Releases (GMT)
•No significant events
Currencies Recap
EUR/USD: The euro edged higher against dollar on Monday as signs of progress in developing a COVID-19 treatment supported euro across the board. Central banks worldwide have rolled out massive stimulus measures to alleviate the economic damage caused by the COVID-19 pandemic, but that has also increased the probability of rising inflation. The euro has pulled back slightly from a two-year high versus the dollar reached last week, which makes it vulnerable to short-term profit taking. Immediate resistance can be seen at 1.1848 (Daily high), an upside break can trigger rise towards 1.1925 (23.6% fib).On the downside, immediate support is seen at 1.1800(38.2% fib ), a break below could take the pair towards 1.1756 (21st Aug low).
GBP/USD: Sterling fell versus the dollar on Monday, amid lingering concerns over the lack of progress in talks between British and European Union Brexit negotiators. The two sides said they made no real progress in their latest talks on how their trade relationship may look like after a transition period expires at the end of December.British and EU chief negotiators blamed each other for the Brexit stalemate as time ticks down to the end-of-year deadline. Immediate resistance can be seen at 1.3145 (Daily high), an upside break can trigger rise towards 1.3190 (23.6% fib).On the downside, immediate support is seen at 1.3078 (21DMA), a break below could take the pair towards 1.2994 (38.2%fib).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart and all the other G10 currencies on Monday, as recent data showed that speculators have added to bearish bets on the loonie despite it climbing to a seven-month high. The loonie was trading 0.4% lower at 1.3226 to the greenback, or 75.61 U.S. cents. Earlier in the day, the currency touched its strongest intraday level since Jan. 24 at 1.3130.U.S. crude oil futures settled 0.7% higher at $42.62 as storms headed for the Gulf of Mexico shut more than half of the region's offshore production, with the more dangerous of the storms expected to strike later in the week .Immediate resistance can be seen at 1.3216 (21 DMA), an upside break can trigger rise towards 1.3331 (38.2% fib).On the downside, immediate support is seen at 1.3192 (Lower BB), a break below could take the pair towards 1.3156 (23.6% fib).
USD/JPY: The dollar steadied against the Japanese yen on Monday as traders looked to more data for a gauge on the health of the global economy and the Federal Reserve’s annual Jackson Hole retreat for guidance on the outlook for U.S. monetary policy. This year the meeting will be held online, and not at the hunting and fishing resort of Jackson Hole, Wyoming because of the coronavirus pandemic. The quantitative easing that the Fed has deployed so far has flooded financial markets with excess liquidity and weighed on the dollar.Sentiment for the greenback has improved somewhat due to supportive data on business activity and home sales, but there are still concerns that additional monetary easing may be necessary to keep economic growth on track. Strong resistance can be seen at 106.13 (30 DMA), an upside break can trigger rise towards 106.78 (50%fib).On the downside, immediate support is seen at 105.52 (38.2% fib ), a break below could take the pair towards 104.41(Lower BB).
Equities Recap
European stocks bounced from a two-week low on Monday as signs of progress in developing a COVID-19 treatment offset fears about a resurgence in virus cases across the continent that could risk stifling an economic recovery.
UK's benchmark FTSE 100 closed down by 0.55 percent, Germany's Dax ended down by 0.97 percent, France’s CAC finished the day down by 1.24 percent.
The S&P 500 and Nasdaq scaled new highs on Monday as a U.S. approval for the emergency use of blood plasma in COVID-19 patients lifted treatment hopes and spurred bets of a quicker economic recovery.
Dow Jones closed up by 1.35 percent, S&P 500 closed up by 1.00 percent, Nasdaq settled the day up by 0.60 percent.
Treasuries Recap
Stable U.S. Treasury yields on Monday showed traders preparing for a week that will include of abarrage of new supply and possible insight from the Federal Reserve on how it will support the economy.
The benchmark 10-year yield was up less than a basis point at 0.6493% in afternoon trading.
Commodities Recap
Oil prices rose on Monday as storms headed for the Gulf of Mexico shut more than half of the region’s offshore production, with the more dangerous of the two storms expected to strike later in the week.
Brent crude settled at $45.13 a barrel, gaining 78 cents, or 1.76%, while U.S. West Texas Intermediate crude settled at $42.62 a barrel, rising 28 cents, or 0.66%.
Gold edged lower on Monday as optimism over a U.S. health regulator’s authorization of a COVID-19 treatment lifted Wall Street stocks to record highs, although a weaker dollar limited bullion’s losses.
Spot gold fell 0.4% to $1,932.50 an ounce by 10:53 a.m. EDT (1453 GMT), having jumped 1% to $1,961.40. U.S. gold futures eased 0.2% to $1,942.90.