Market Roundup
• Investors shun risk assets as coronavirus spreads globally
• US Jan Core PCE Price Index (YoY) 1.6%, 1.7% forecast, 1.5% previous
• US Jan Core PCE Price Index (MoM) 0.1%,0.2% forecast, 0.2% previous
• US Jan Goods Trade Balance -65.50B, -68.67B previous
• US Jan Personal Income (MoM) 0.6%,0.3% forecast, 0.1% previous
• US Jan Retail Inventories Ex Auto 0.3% , 0.1% previous
• US Wholesale Inventories (MoM) -0.2%,-0.3% previous
• Canada Dec GDP (MoM) -0.3%,0.1% forecast, 0.1% previous
• Canada GDP (YoY) (Q4) 1.47%,1.63% previous
• US Feb Chicago PMI 49.0, 45.9 forecast, 42.9 previous
• US Feb Michigan 5-Year Inflation Expectations 2.30%,2.50% previous
• Canada Dec Budget Balance (YoY) -10.97B, -11.75B previous
Looking Ahead - Economic Data (GMT)
• No significant data
Looking Ahead - Economic events and other releases (GMT)
• No significant events
Currency Summaries
EUR/USD: The euro gained against dollar on Friday after Federal Reserve Chair Jerome Powell suggested the central bank could cut interest rates in the wake of the coronavirus. Powell on Friday said the central bank will “act as appropriate” to support the economy in the face of risks posed by the coronavirus outbreak, though he said the economy remained in solid condition. The euro rose 0.23% to $1.`1025. Immediate resistance can be seen at 1.1051(Daily high), an upside break can trigger rise towards 1.1100 (Psychological level).On the downside, immediate support is seen at 1.0951 (5 DMA), a break below could take the pair towards 1.0924(5 DMA).
GBP/USD: Sterling declined sharply against dollar on Friday as worries about the fast-spreading coronavirus sent investors out of currencies deemed riskier.Investors rushed for the safe-haven Japanese yen, Swiss franc and U.S. dollar, sterling fell to its lowest against the dollar since October. Investors are also fretting about Britain’s negotiations with the European Union over a trade deal and whether a UK budget next month will include much more spending, which many investors say is necessary to boost economic growth. Immediate resistance can be seen at 1.2919(5 DMA), an upside break can trigger rise towards 1.3025 (50 DMA).On the downside, immediate support is seen at 1.2723 (Daily low), a break below could take the pair towards 1.2700 (Psychological level).
USD/CHF: The dollar dipped against the Swiss franc on Friday as worries over the spread of the coronavirus aggravated fears of an economic slowdown. Markets worldwide have been caught up in a rout this week with pandemic fears heightening as the numbers of new infected cases around the world surpassed those within mainland China, where the outbreak originated late in December. At (GMT 22:45), Greenback dipped 0.26% versus the Swiss franc to 0.9650. Immediate resistance can be seen at 0.9727 (5 DMA), an upside break can trigger rise towards 0.9777 (11DMA).On the downside, immediate support is seen at 0.9650 (Lower BB), a break below could take the pair towards 0.9608 (Daily low).
USD/JPY: The dollar declined to seven week low against the Japanese yen on Friday as investors nervous about the spread of the coronavirus in the United States piled into the safe-haven currency. Hopes that the outbreak can be contained in China have been replaced this week by worries that infections are spreading around the globe. Measures to contain the virus have wreaked havoc on supply chains, the world’s economy and financial markets. Strong resistance can be seen at 108.97(Ichimoku Cloud Base), an upside break can trigger rise towards 109.73 (5 DMA).On the downside, immediate support is seen at 107.51 (Daily low), a break below could take the pair towards 107.00 (Psychological level).
Equities Recap
European shares ended the week down roughly $1.5 trillion in their worst weekly performance since the 2008 financial crisis as the rapid spread of coronavirus outside China saw sustained selling on fears of a recession.
UK's benchmark FTSE 100 closed down by 3.18 percent, Germany's Dax ended up by 3.86 percent, France’s CAC finished the day down by 3.39 percent.
Wall Street’s main indexes plunged on Thursday for the sixth straight session, with the S&P 500 confirming its fastest correction in history as the rapid global spread of coronavirus intensified worries about economic growth.
Dow Jones closed down by 3.86 percent, S&P 500 closed down by 4.42 percent, Nasdaq settled down by -4.61% percent.
Treasuries Recap
Money continued to pour into U.S. Treasuries on Friday on coronavirus concerns, pressuring central bankers to cut rates by sending the yield on the two-year note below 1% for the first time since 2016.
The two-year U.S. Treasury yield was down 15.8 basis points to 0.9447%, and at one point was at 0.8913%, its lowest level since late 2016.
Commodities Recap
Gold slumped over 3% on Friday, en route to its biggest daily fall in nearly seven years as mounting coronavirus fears drove panic-stricken investors to liquidate assets across the board.
Spot gold plunged 3.5% to $1,584.84 per ounce as of 11:03 a.m. EST (1603 GMT), leading to the biggest one-day percentage decline since mid-2013. Bullion is down more than $60 from the session high of $1,649.11 touched earlier.
Oil prices slumped for a sixth day in a row on Friday to their lowest in more than a year, set for their steepest weekly fall since 2016 as the global spread of the coronavirus stokes demand fears.
The most active Brent future for May delivery was down $1.84, or 3.6%, at $49.89 a barrel by 12:52 p.m. EST (1752 GMT), its lowest since July 2017.
Brent futures for April delivery fell $1.65, or 3.2%, to $50.53 a barrel, while U.S. West Texas Intermediate (WTI) crude CLc1 fell $2.25, or 4.8%, to $44.84.
