Market Roundup
- Gold holds gains amid virus worries
- Oil rises on hopes for output cuts
- S&P cuts Australia outlook
Economic Data Ahead
- No Major Economic Releases
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index gained as investors awaited the U.S. Federal Reserve minutes from its emergency meeting last month, which may include more commentary on the depth of the economic contraction that looms. The greenback against a basket of currencies traded 0.3 percent up at 100.21, having touched a high of 100.93 on Monday, its highest since Mar. 26.
EUR/USD: The euro eased, reversing some of its previous session gains, as Spain’s daily toll of coronavirus deaths rose for the first time in five days, but officials there and across the continent pushed forward with plans to begin lifting some lockdown measures soon. The European currency traded 0.4 percent down at 1.0844, having touched a low of 1.0768 on Monday, its lowest since March 25. Investors’ attention will remain on the Fed minutes amid a lack of data from the Eurozone economies. Immediate resistance is located at 1.0942 (10-DMA), a break above targets 1.0964 (21-DMA). On the downside, support is seen at 1.0820, a break below could drag it below 1.0791.
USD/JPY: The dollar steadied as signs of progress in curbing the spread of the novel coronavirus fueled investors’ appetite for risk. The governments and central banks around the world have unleashed unprecedented fiscal and monetary stimulus. The major was trading 0.1 percent up at 108.83, having hit a high of 109.38 on Monday, its highest since Mar. 27. Investors’ will continue to track the broad-based market sentiment, ahead of the Fed minutes. Immediate resistance is located at 109.22, a break above targets 109.58. On the downside, support is seen at 108.40, a break below could take it near at 108.25 (21-DMA).
GBP/USD: Sterling nudged down, halting a 2-day winning streak as traders awaited news on British Prime Minister Boris Johnson, who is stable in intensive care as he battles COVID-19 symptoms. The major traded 0.2 percent lower at 1.2307, having hit a low of 1.2163 on Tuesday, it’s lowest since March 27. Investors’ attention will remain on the geopolitical developments ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2370, a break above could take it near 1.2415. On the downside, support is seen at 1.2205, a break below targets 1.2140. Against the euro, the pound was trading 0.1 percent up at 88.17 pence, having hit a high of 87.39 on Friday, it’s highest since Mar. 11.
AUD/USD: The Australian dollar declined after S&P cuts Australian credit outlook. Global ratings agency S&P lowered its outlook on Australia’s coveted ‘AAA’ rating to negative from stable in anticipation of a material weakening in the government’s debt position as it rolled out a large fiscal stimulus package. The Aussie trades 0.5 percent down at 0.6138, having hit a high of 0.6208 on Tuesday, it’s highest since Mar. 16. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.6200, a break above could take it near 0.6234. On the downside, support is seen at 0.6086, a break below targets 0.6053.
Equities Recap
Asian shares declined as investors tempered their optimism about the coronavirus while death tolls were still increasing across the globe.
MSCI's broadest index of Asia-Pacific shares outside Japan dropped 0.7 percent.
Tokyo's Nikkei rose 2.1 percent to 19,353.24 points, Australia's S&P/ASX 200 index fell 0.8 percent to 5,206.90 points and South Korea's KOSPI eased 0.9 percent to 1,807.14 points.
Shanghai composite index declined 0.2 percent to 2,815.37 points, while CSI 300 index traded 0.5 percent down at 3,780.34 points
Hong Kong’s Hang Seng traded 1.2 percent lower at 23,944.29 points. Taiwan shares added 1.4 percent to 10,137.47 points.
Commodities Recap
Crude oil rose after falling for two straight sessions, boosted by hopes that a meeting between OPEC members and allied producers on Thursday will trigger output cuts to support prices. International benchmark Brent crude was trading 1.5 percent higher at $32.91 per barrel by 0543 GMT, having hit a high of $36.11 on Thursday, its highest since March 12. U.S. West Texas Intermediate was trading 4.5 percent up at $25.19 a barrel, after rising as high as $29.11 on Friday, its highest since Mar. 17.
Gold prices declined as a stronger dollar countered risk-off sentiment stemming from fading optimism over signs of a slowing spread of the coronavirus. Spot gold eased 0.1 percent to $1,647.29 per ounce by 0548 GMT, having touched a high of $1675.60 on Monday, its highest since Mar. 10. U.S. gold futures were flat, at $1,683.30.
Treasuries Recap
The prices of most Japanese government bonds edged lower, with benchmark 10-year JGB futures falling 0.17 point to 152.05. In the cash bond market, the 10-year JGB yield rose 1 basis point to 0.010 percent, while the 20-year yield rose 0.5 basis point to 0.315 percent. Longer-dated bonds did better, with the 30-year yield flat at 0.445 percent and the 40-year yield down 0.5 basis point at 0.445 percent.
