Posted at 15 May 2020 / Categories Market Roundups
Market Roundup
Economic Data Ahead
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FX Beat
DXY: The dollar index surged amid optimism about the re-opening of the U.S. economy from coronavirus lockdowns and possibly more stimulus that could fuel a recovery. The greenback against a basket of currencies traded 0.1 percent up at 100.35, having touched a high of 100.56 on Thursday, its highest since April 24.
EUR/USD: The euro consolidated within narrow ranges, as global markets remained wary of a second wave of coronavirus infections, while European analysts focused on the policy response to the pandemic. The European currency traded flat at 1.0806, having touched a low of 1.0774, its lowest since May 7. Investors’ attention will remain on a series of economic data from the Eurozone economies and EZ trade balance, employment change and gross domestic product, ahead of the U.S. retail sales, industrial production, capacity utilization, business inventories, JOLTS Job Opening and Michigan consumer sentiment index. Immediate resistance is located at 1.0827, a break above targets 1.0845 (10-DMA). On the downside, support is seen at 1.0782, a break below could drag it below 1.0755.
USD/JPY: The dollar trimmed early session gains as rising U.S.-China tensions and worries about a second wave of coronavirus infections rattled investor sentiment. The major was trading 0.05 percent down at 107.15, having hit a high of 107.76 on Monday, its highest since Apr. 23. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. retail sales, industrial production, capacity utilization, business inventories, JOLTS Job Opening and Michigan consumer sentiment index. Immediate resistance is located at 107.49, a break above targets 107.76. On the downside, support is seen at 107.01, a break below could take it near at 106.80.
GBP/USD: Sterling declined, extending losses for the fifth straight session, weighed down by a combination of coronavirus-induced economic woes and Brexit risks. The British government reiterated its refusal to extend the Brexit transition period deadline beyond December this year, signalling its unwillingness to compromise in trade negotiations with the EU. The major traded 0.2 percent down at 1.2204, having hit a low of 1.2165 on Thursday, it’s lowest since April 7. Investors’ attention will remain on the geopolitical developments ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2286 (5-DMA), a break above could take it near 1.2320. On the downside, support is seen at 1.2160, a break below targets 1.2130. Against the euro, the pound was trading 0.3 percent down at 88.55 pence, having hit a low of 88.77 on Wednesday, it’s lowest since April 21.
AUD/USD: The Australian dollar eased, reversing most of its previous session gains, as investors and authorities weigh optimism about easing virus containment measures against the risk of more infections and the sheer scale of economic damage. The Aussie trades 0.2 percent down at 0.6449, having hit a low of 0.6403 earlier, it’s lowest since May 7. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.6487, a break above could take it near 0.6530. On the downside, support is seen at 0.6427 (21-DMA), a break below targets 0.6372.
Equities Recap
Asian shares were on course to end the week lower as deteriorating U.S.-China relations offset optimism over the reopening of major economies.
MSCI's broadest index of Asia-Pacific shares outside Japan was little changed.
Tokyo's Nikkei rallied 0.6 percent to 20,037.47 points, Australia's S&P/ASX 200 index gained 1.4 percent to 5,404.80 points. South Korea's KOSPI surged 0.1 percent to 1,927.24 point.
Shanghai composite index rose 0.1 percent to 2,866.79 points, while CSI 300 index traded 0.4 percent down at 3,911.55 points.
Hong Kong’s Hang Seng traded 0.2 percent lower at 23,789.80 points. Taiwan shares added 0.3 percent to 10,814.92 points.
Commodities Recap
Crude oil prices rose, extending previous session gains, as data showed demand for crude picking up in China after the easing of curbs to stem the coronavirus outbreak. International benchmark Brent crude was trading 1.2 percent higher at $31.75 per barrel by 0518 GMT, having hit a high of $32.20 last week, its highest since April 14. U.S. West Texas Intermediate was trading 0.6 percent up at $28.18 a barrel, after rising as high as $27.95 last week, its highest since April 9.
Gold prices surged, hovering towards a 3-week high hit in the previous session, underpinned by talks of further U.S. stimulus and worsening U.S.-China relations. Spot gold gained 0.1 percent to $1,732.55 per ounce by 0528 GMT, having touched a high of $1,736.15 on Thursday, its highest since Apr. 24 and has gained about 1.8 percent so far this week. U.S. gold futures climbed 0.1 percent to $1,742.30.
Treasuries Recap
The benchmark 10-year yield was down 3.1 basis points in afternoon trading at 0.6202 percent. The two-year U.S. Treasury yield was down less than a basis point at 0.153 percent.