America’s Roundup: Dollar gains as Fed moves to bolster tight credit markets ,Wall Street bounces, Gold rebounds, Oil dips as demand weakens due to coronavirus -March 18th,2020

Market Roundup

• US Feb Core Retail Sales (MoM)  -0.4%    , 0.2% previous, 0.6% previous

• US Feb Retail Sales (MoM)  -0.5%,0.2% previous, 0.6% previous

• Canada Jan Foreign Securities Purchases  17.01B, -10.22B previous

• Canada Jan Foreign Securities Purchases by Canadians  -9.10B, 13.80B    previous

• Canada Jan Manufacturing Sales (MoM)  -0.2%,-0.5%  forecast, -0.7% previous

• US Feb Industrial Production (YoY)  0.04%,-1.02% previous

• US Feb Industrial Production (MoM ) 0.6%,0.4% forecast, -0.5% previous

• US Jan Business Inventories (MoM)  -0.1% forecast, 0.1% previous

• US Jan  JOLTs Job Openings  6.476M forecast, 6.423M    previous

• US March NAHB Housing Market Index  72, 73    forecast, 74 previous

• New Zealand  GlobalDairyTrade Price Index-3.9%,-2.7% forecast, -1.2% previous

Looking Ahead - Economic Data (GMT)

• 23:30 Australia MI Leading Index (MoM) 0.1%  previous

• 23:50  Japan Feb Exports (YoY)  -4.3% forecast, -2.6 previous

• 23:50  Japan Feb Imports (YoY)  -14.4%    forecast, -3.5%  previous

Looking Ahead - Events, Other Releases (GMT)

• 01:00 Australia RBA Assist Gov Ellis Speaks  

Currency Summaries

EUR/USD: The euro declined against dollar on Tuesday, after data showed mood among German investors slumped in March due to impact of the coronavirus outbreak on Europe’s largest economy. The ZEW research institute’s monthly survey showed economic sentiment among investors collapsed to -49.5 from 8.7 in February. This was the biggest drop since the survey began in 1991. Economists had expected a drop to -26.4.  Immediate resistance can be seen at 1.1091(5 DMA), an upside break can trigger rise towards 1.1192 (9 DMA).On the downside, immediate support is seen at 1.0972 (Daily low), a break below could take the pair towards 1.9700 (Psychological level).

GBP/USD: Sterling dropped to its lowest level against the U.S. dollar since early September on Tuesday, as Britain toughened its approach to containing the coronavirus outbreak. The pound has been in retreat as fears about the likely full economic impact of the pandemic have roiled global markets and sent investors fleeing to assets seen as relative safe havens, including the dollar. The pound fell as much as 0.8% to $1.2052 on Tuesday. Against the euro it edged up 0.2% to 91.06 pence per euro, but was still trading near the previous day’s six-month low of 89.89 pence. Immediate resistance can be seen at 1.2178 (23.6% fib), an upside break can trigger rise towards 1.2285 (38.2% fib).On the downside, immediate support is seen at 1.2000 (Daily low), a break below could take the pair towards 1.1935 (1st Nov 2019 lows).

USD/CAD: The Canadian dollar weakened to a four-year low against its U.S. counterpart on Tuesday as growing panic about a coronavirus-induced economic slump boosted the greenback and weak factory data added to pressure on the Bank of Canada to cut further. Canadian manufacturing sales fell 0.2% in January, the fifth consecutive monthly decline. At (21:37 GMT), the Canadian dollar was last trading 0.8% lower at 1.4193 to the greenback. The currency touched its weakest intraday level since January 2016 at 1.4164.  Immediate resistance can be seen at 1.4281 (Daily high), an upside break can trigger rise towards 1.4300 (Psychological level).On the downside, immediate support is seen at 1.4039 (5 DMA ), a break below could take the pair towards 1.3965 (23.6% fib).

USD/JPY: The dollar gained against the Japanese yen on Tuesday, as companies and investors sought out the most liquid currency as concerns about economic shutdowns from the coronavirus continued to dent risk appetite The Federal Reserve on Sunday slashed rates to zero and launched a new bond purchase program. Other central banks have taken similar measures but the moves have so far failed to stem liquidity strains and market panic.Central banks have also cut pricing on their swap lines to make it easier to provide dollars to financial institutions around the world. But funding markets show continued stress in sourcing the greenback. Strong resistance can be seen at 107.81 (21 DMA), an upside break can trigger rise towards 108.91 (50 DMA).On the downside, immediate support is seen at 105.86 (5 DMA), a break below could take the pair towards 105.00 (Psychological level). 

Equities Recap

European shares retreated after an initial bounce on Tuesday as damage being heaped on companies and economies across the globe from the coronavirus grew and kept financial markets on edge.    

The UK's benchmark FTSE 100 closed up by 0.42 percent, Germany's Dax ended up  by 1.16 percent, and France’s CAC finished the up by 1.27 percent.

The S&P 500 rose 6% on Tuesday, recouping half of the previous session’s historic sell-off, as the Federal Reserve and the White House took further steps to boost liquidity and stem damage from the coronavirus outbreak that has gripped the global economy.

Dow Jones was last trading at 5.20 percent, S&P 500 ended up 5.99 percent, Nasdaq finished the day down by 6.23 percent.

Treasuries Recap

U.S. Treasury yields headed higher on Tuesday as Wall Street recorded gains after devastating losses and the Federal Reserve rode to the rescue of the stressed commercial paper market.    

The benchmark 10-year Treasury note yield rose to 0.835%, up from 0.728% at Monday's close as risk appetite improved, reducing demand for safe-haven debt.    

Commodities Recap

Gold jumped on Tuesday as a five-session decline in the bullion market led bargain hunters out in force, with the Federal Reserve’s announcement to relaunch financial crisis-era purchases of short-term corporate debt offering further support.    

Spot gold jumped 1.5% to $1,536.62 per ounce at 11:32 a.m. EDT (1532 GMT). U.S. gold futures soared 3.3% to $1,535.60.

Crude oil prices settled below $30 a barrel as the coronavirus pandemic slowed economic growth and oil demand on Tuesday while Saudi Arabia and Russia kept up their battle for market share.

Brent crude futures fell $1.32 to settle at $28.73, the first time that benchmark has settled below $30 per barrel since 2016. It then fell further in post-settlement trade.
West Texas Intermediate (WTI) crude futures fell $1.75, or 6.1%, to settle at $26.95 a barrel.