Posted at 10 October 2020 / Categories Market Roundups
Market Roundup
• Dollar sold this week as stimulus hopes boost mood
• Canada Sep Employment Change 378.2K, 156.6K forecast, 245.8K previous
• Canada Sep Full Employment Change378.2K, 205.8K previous
• Canada Sep Part Time Employment Change 65.0%,40.0K previous
• Canada Sep Unemployment Rate 9.0%, 9.7%forecast, 10.2% previous
• Canada Sep Participation Rate 65.0%,64.8% forecast, 64.6% previous
• US Aug Wholesale Trade Sales (MoM) 2.0% forecast, 4.6% previous
• U.S. Baker Hughes Oil Rig Count 193, 189 previous
Looking Ahead - Economic Data (GMT)
•No data ahead
Looking Ahead - Events, Other Releases (GMT)
•No significant events
Currencies Summaries
EUR/USD: The euro strengthened against dollar on Friday as renewed hopes for a U.S. stimulus package lifted sentiment in the market. Euro rallied after U.S. President Donald Trump said on Thursday talks with Congress had restarted on targeted fiscal relief, after he had called off negotiations earlier this week. Investors are also starting to bet that Joe Biden, Trump’s challenger in the Nov. 3 presidential election, will win, potentially leading to a bigger stimulus package. Immediate resistance can be seen at 1.1831(Daily high), an upside break can trigger rise towards 1.1889 (61.8%fib).On the downside, immediate support is seen at 1.1806 (50%fib), a break below could take the pair towards 1.1751 (9DMA).
GBP/USD: Sterling gained against dollar on Friday, brushing off worse than expected UK growth data as investors became more optimistic about a Brexit deal being reached ahead of a key European Council summit next week. Britain’s GDP rose 2.1% in August the slowest increase since the economy began to recover in May from its record slump. Much of what growth occurred was down to the government’s one-off restaurant subsidy scheme. The pound has been volatile this week on contradictory headlines about how much progress has been made in Brexit negotiations. Both sides have said a deal is still possible. Immediate resistance can be seen at 1.3037 (50%fib), an upside break can trigger rise towards 1.3100 (Psychological level).On the downside, immediate support is seen at 1.2928(38.2%fib), a break below could take the pair towards 1.2867(14DMA).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Friday to notch its biggest weekly advance in four months, driven by domestic data showing a faster pace of job gains and rising hopes of U.S. stimulus that boosted Wall Street.Canada added 378,200 jobs in September after an increase of 246,000 in the previous month, handily beating analyst expectations, as children returned to school and the economy continued to reopen from coronavirus shutdowns, Statistics Canada said. The Canadian dollar was trading 0.5% higher at 1.3131 to the greenback. cents. The currency touched its strongest intraday level since Sept. 8 at 1.3111. Immediate resistance can be seen at 1.3159 (38.2% fib), an upside break can trigger rise towards 1.3215 (50%fib).On the downside, immediate support is seen at 1.3092 (23.6%fib), a break below could take the pair towards 1.3000 (Psychological level).
USD/JPY: The dollar declined against the Japanese yen on Friday as investors increased bets that Joe Biden would win the U.S. presidential election on Nov. 3 and offer fiscal stimulus afterwards. A widening lead for Democratic Presidential candidate Joe Biden is seen as reducing the risk of a contested election and opening the way for a big economic stimulus, helping to counter investors’ wariness about a Democrat pledge to hike corporate tax rates. Strong resistance can be seen at 105.77 (5DMA), an upside break can trigger rise towards 106.38 (38.2%fib).On the downside, immediate support is seen at 105.45 (23.6%fib), a break below could take the pair towards 105.00 (Psychological level).
Equities Recap
European stocks posted a second consecutive week of gains on Friday as bumper forecasts from Denmark’s Pandora and Novo Nordisk set a brighter tone for the earnings season, while investors kept an eye out for signs of fresh U.S. stimulus.
UK's benchmark FTSE 100 closed up by 0.65 percent, Germany's Dax ended up by 0.07 percent, France’s CAC finished the day up by 0.71 percent.
U.S. stocks ended higher on Friday and registered gains for the week as optimism over more federal fiscal aid grew.
Dow Jones closed up by 0.57% percent, S&P 500 closed up by 0.88 % percent, Nasdaq settled up by 1.39% percent.
Treasuries Recap
Yields on longer-dated Treasury bonds dipped slightly on Friday morning as traders took profits on positions, driving prices higher on safe-haven assets even as the U.S. stock market experienced a modest risk-on rally.
The benchmark 10-year yield was last down half a basis point to 0.762% with the two-year yield flat at 0.147%. That narrowed the yield curve, measured by the spread between two- and 10-year yields, by about 2 basis points to 61.3 basis points.
Commodities Recap
Gold climbed more than 1% on Friday as the dollar retreated to a near three-week low and increased bets for fresh U.S. stimulus pushed investors to bullion as a hedge against likely inflation.
Spot gold rose 1.4% to $1,919.36 per ounce by 12:03 pm EDT (1603 GMT), en route to a second straight weekly gain, of about 1.2%. U.S. gold futures gained 1.6% to $1,925.
Oil prices slipped more than 1% on Friday after an oil worker strike in Norway ended, which should boost crude output even as Hurricane Delta forced U.S. energy firms to cut production.
Brent futures fell 49 cents, or 1.1%, to settle at $42.85 a barrel, while U.S. West Texas Intermediate (WTI) crude fell 59 cents, or 1.4%, to settle at $40.60.