Posted at 28 October 2020 / Categories Market Roundups
Market Roundup
Economic Data Ahead
Key Events Ahead
FX Beat
DXY: The dollar index declined from a 1-week peak after U.S. President Donald Trump acknowledged that a coronavirus economic relief deal would likely come after the Nov. 3 election. The greenback against a basket of currencies traded 0.2 percent down at 93.04, having touched a high of 93.19 earlier, its highest since October 20.
EUR/USD: The euro slumped to a 1-week low following a media report that France’s government was leaning toward reinstating a national lockdown to curb a resurgence in coronavirus cases. The European currency traded 0.1 percent lower at 1.1783, having touched a low of 1.1769 earlier, its lowest since October 20. Investors’ attention will remain on a series of economic data from the Eurozone economies, ahead of the U.S. Wholesale Inventories, Goods Trade Balance and Fed's Kaplan speech. Immediate resistance is located at 1.1815, a break above targets 1.1832. On the downside, support is seen at 1.1748, a break below could drag it below 1.1730.
USD/JPY: The dollar plunged to an over 1-month low after Trump conceded that an additional round of U.S. fiscal stimulus is unlikely before the election. Moreover, worries about the virus' spread continued, with the United States, Russia, France and other countries seeing record new infections recently. The major was trading 0.2 percent down at 104.21, having hit a low of 104.19 earlier, its lowest since September 21. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. Wholesale Inventories, Goods Trade Balance and Fed's Kaplan speech. Immediate resistance is located at 104.67 (5-DMA), a break above targets 104.93. On the downside, support is seen at 104.00, a break below could take it near at 103.88.
GBP/USD: Sterling rose, extending previous session gains, amid rising hopes of a trade deal between the European Union and Britain. European Union chief negotiator Michel Barnier resumed talks in London with his British counterpart on Tuesday as the two sides tried to strike a last-minute trade agreement less than 10 weeks before the United Kingdom leaves the bloc. The major traded 0.1 percent higher at 1.3054, having hit a high of 1.3152 last week, it’s highest since September 7. Investors’ attention will remain on the geopolitical developments, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.3082, a break above could take it near 1.3102. On the downside, support is seen at 1.3003 (10-DMA), a break below targets 1.2974. Against the euro, the pound was trading 0.2 percent up at 90.22 pence, having hit a high of 90.11 last week, it’s highest since October 14.
AUD/USD: The Australian dollar surged after data showed consumer prices in the third quarter rose 1.6 percent from the prior quarter, slightly more than the median estimate. The Reserve Bank of Australia is widely expected to lower interest rates and expand its government debt purchases at its next meeting on Nov. 3. The Aussie trades 0.3 percent up at 0.7111, having hit a high of 0.7158 on Friday, it’s highest since October 15. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.7170, a break above could take it near 0.7186. On the downside, support is seen at 0.7102, a break below targets 0.7084.
NZD/USD: The New Zealand dollar rallied, hovering towards an over 1-month peak as the greenback declined from recent peaks. The Kiwi traded 0.1 percent higher at 0.6714, having touched a high of 0.6724 on Friday, its highest level since September 21. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6737, a break above could take it near 0.6750. On the downside, support is seen at 0.6670, a break below could drag it below 0.6653.
Equities Recap
Asian shares slumped as coronavirus infections grew at an alarming pace in the United States and Europe, while uncertainty over next week’s U.S. elections dented investor risk sentiment.
MSCI’s broadest index of Asia-Pacific shares outside Japan slumped 0.15 percent.
Tokyo's Nikkei fell 0.3 percent to 23,418.51 points, Australia's S&P/ASX 200 index gained 0.1 percent to 6,057.70 points. South Korea's KOSPI surged 0.6 percent to 2,345.26 points.
Shanghai composite index rose 0.5 percent to 3,269.24 points, while CSI 300 index traded 0.8 percent up at 4,737.27 points.
Hong Kong’s Hang Seng traded 0.3 percent lower at 24,718.22 points. Taiwan shares shed 0.6 percent to 12,793.75 points.
Commodities Recap
Crude oil prices declined, reversing some of its previous day’s gains, as a jump in U.S. crude inventories and surging COVID-19 cases raised fears of an oversupply of oil and weak fuel demand. International benchmark Brent crude was trading 0.2 percent down at $40.54 per barrel by 0610 GMT, having hit a low of $40.20 on Monday, its lowest since October 5. U.S. West Texas Intermediate was trading 0.5 percent lower at $38.78 a barrel, after falling as low as $38.31 on Monday, its lowest since October 5.
Gold prices surged, extending previous session gains, as uncertainties about U.S. elections and surging global COVID-19 cases countered pressure from a firmer dollar and fading hopes of an immediate U.S. stimulus package. Spot gold was trading 0.1 percent higher at $1,909.68 per ounce by 0623 GMT, having hit a low of $1891.50 on Thursday, its lowest since October 15. U.S. gold futures were down 0.3 percent at $1,907.10.
Treasuries Recap
The U.S. Treasury yields eased, with the benchmark 10-year note yield trading at 0.761 percent and the 30-year yield at 1.552 percent.