Posted at 27 August 2020 / Categories Market Roundups
Market Roundup
•U.S. consumer confidence hits six-year low
•Traders expect dovish tone from Fed’s Powell
•US Goods Jul Orders Non Defense Ex Air (MoM) 1.9%, 1.9%, 3.4% previous
•US Jul Durables Excluding Defense (MoM) 9.9%, 9.5% previous
•US Jul Core Durable Goods Orders (MoM) 2.4%, 2.0% forecast ,3.6% previous
•US Jul Durable Goods Orders (MoM) 11.2%, 4.3% forecast, 7.6% previous
•US Gasoline Production 0.118M,-0.200M previous
•US Gasoline Inventories-4.584M, -1.533M forecast, -3.322M previous
•US Crude Oil Inventories-4.689M,-3.694M forecast, -1.632M previous
•Australia Private New Capital Expenditure (QoQ) (Q2) -5.9%,8.4% forecast, -1.6% previous
•Chinese Jul Industrial profit (YoY) 19.60%, 11.50% previous
•Chinese Jul Industrial profit YTD -8.1%, -12.8% previous
•Australia Plant/Machinery Capital Expenditure (QoQ) (Q2) -7.6%, -2.3% previous
•Australia Building Capital Expenditure (MoM) (Q2) -4.4%, -1.1% previous
Looking Ahead – Economic Data (GMT)
•04:30 Japan All Industries Activity Index (MoM) -3.5% previous
Looking Ahead - Events, Other Releases (GMT)
• No significant events
Currencies Recap
EUR/USD: The euro was little changed against dollar on Wednesday as investors refrained from taking risky bets a day ahead of a key speech by Federal Reserve Chairman Jerome Powell. Amid growing speculation Powell could unveil a softer policy stance towards inflation at the annual Jackson Hole retreat on Thursday, investors are bracing for the Fed’s possible new steps to prop up the U.S. economy. Both a policy change announcement and the lack of are expected to resonate strongly across trading floors. Immediate resistance can be seen at 1.1840 (23.6%fib), an upside break can trigger rise towards 1.1940 (23.6% fib).On the downside, immediate support is seen at 1.1752 (50% fib ), a break below could take the pair towards 1.1892 (Lower BB).
GBP/USD:The British currency held steady on Wednesday against the U.S. dollar, as Brexit uncertainty kept traders on the sidelines. This week’s biggest scheduled event is Bank of England Governor Andrew Bailey’s speech at Jackson Hole on Thursday. Sterling was steady at $1.3155 and rose 0.2% to 89.84 pence against the euro. The British currency has been dragged higher in recent weeks by a weakening U.S. dollar. Immediate resistance can be seen at 1.3192 (23.6%fib), an upside break can trigger rise towards 1.3228 (Lower BB).On the downside, immediate support is seen at 1.3130 (5 DMA), a break below could take the pair towards 1.2997 (38.2%fib).
USD/CAD: The Canadian dollar shook off early weakness to rise to a fresh seven-month high against its broadly weaker U.S. counterpart on Wednesday, as investors' appetite for riskier assets rose and firmer oil prices provided support. The Canadian dollar was at 1.3141 to the greenback, stronger than Tuesday's close of 1.3168. The Canadian dollar also found support as the price of oil, one of Canada's major exports, held near $46 a barrel on Wednesday, helped by U.S. producers shutting output in the Gulf of Mexico ahead of Hurricane Laura. Immediate resistance can be seen at 1.3161 (23.6% fib), an upside break can trigger rise towards 1.3161 (9 DMA).On the downside, immediate support is seen at 1.3127 (19 Aug low), a break below could take the pair towards 1.3042 ( Lower BB).
USD/JPY: The dollar edged higher against the Japanese yen on Wednesday but stayed within a relatively tight range a day ahead of a highly anticipated speech by Federal Reserve Chairman Jerome Powell. Powell is scheduled to address the U.S. central bank’s policy framework review, and investors are focused on whether he will hint at shifting the Fed’s inflation target to an average. The Fed is thought to be still finalizing details of its review, however, with an announcement expected at its September meeting. Strong resistance can be seen at 106.78(50% fib), an upside break can trigger rise towards 107.04 (Higher BB).On the downside, immediate support is seen at 105.77 ( Daily low ), a break below could take the pair towards 105.52(38.2% fib).
Equities Recap
European stocks closed higher on Wednesday as news of additional stimulus in Germany and anticipated economic recovery measures in France overcame concerns about rising COVID-19 cases across the continent.
UK's benchmark FTSE 100 closed up by 0.14 percent, Germany's Dax ended up by 0.98 percent, France’s CAC finished the day up by 0.80 percent.
U.S. stocks surged on Wednesday, pushing the S&P 500 to its fourth straight record closing high, as investors stayed focused on large-cap momentum stocks that have outperformed since the onset of the coronavirus pandemic.
Dow Jones closed up by 0.30 percent, S&P 500 ended up by 1.02 percent, Nasdaq finished the day up by 1.73npercent.
Treasuries Recap
Yields on longer-term U.S. Treasuries were higher Wednesday as traders anticipated that Federal Reserve comments would raise inflation expectations
The benchmark 10-year yield was up about a basis point at 0.69% in afternoon trading, though off of a high of 0.721% reached in the morning before results of an auction of 5-year notes showed continued strong demand.
Commodities Recap
Gold prices fell on Wednesday as the dollar gained while investors waited for U.S. Federal Reserve Chairman Jerome Powell's speech for a snapshot of the central bank's monetary plan to revive the pandemic-hit U.S. economy.
Spot gold was down 0.6% at $1,915.61 an ounce by 1203 GMT. U.S. gold futures eased by 0.1% to $1,921.40.
Oil prices steadied on Wednesday, pressured by worries about the demand outlook during the coronavirus pandemic but buoyed as U.S. producers shut output in the Gulf of Mexico ahead of Hurricane Laura.
Brent crude fell 22 cents to settle at $45.64 a barrel, while U.S. West Texas Intermediate crude rose 4 cents to $43.39 a barrel. Both benchmarks settled at a five-month high on Tuesday.