Market Roundup
- Euro hovers near 4-1/2 month
- Oil eases amid rising coronavirus cases worldwide
Economic Data Ahead
- (0400 ET/0400 GMT) EZ Current Account n.s.a(May)
- (0400 ET/0400 GMT) EZ Current Account s.a(May)
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index slumped after a battle in the U.S. Congress over a new coronavirus-aid bill began late last week as Republicans and Democrats pushed for their own agenda. The greenback against a basket of currencies traded 0.2 percent lower at 95.87, having touched a low of 95.78 on Wednesday, its lowest since June 10.
EUR/USD: The euro rose to a 4-1/2 month peak on hopes that European leaders will break a deadlock and agree on an economic rescue deal in their summit talks. European Union leaders are at an impasse over a proposed 750 billion euro recovery fund, which is supposed to be raised on behalf of them all on capital markets by the EU’s executive European Commission. The European currency traded 0.3 percent up at 1.1462, having touched a high of 1.1464 earlier, its highest since March 9. Investors’ attention will remain on a series of data from Eurozone economies and EZ current account, amid a lack of U.S. economic data. Immediate resistance is located at 1.1510, a break above targets 1.1570. On the downside, support is seen at 1.1367, a break below could drag it below 1.1327.
USD/JPY: The dollar rose to a near 2-week peak, as investor risk appetite continued to remain strong, underpinned by bets of more stimulus from Europe and also the United States. Market expectations of more government spending have offset worries about rising coronavirus cases in the United States as well as fears over deteriorating U.S.-China relations. The major was trading 0.2 percent up at 107.23, having hit a high of 107.54 earlier, its highest since July 8. Investors’ will continue to track the broad-based market sentiment, as U.S. economic calendar remains absolutely data empty. Immediate resistance is located at 107.80, a break above targets 108.20. On the downside, support is seen at 106.78, a break below could take it near at 106.38.
GBP/USD: Sterling eased, reversing most of its previous session gains, weighed down by Britain’s bleak economic outlook, Brexit uncertainties and the possibility of negative interest rates. The major traded 0.1 percent down at 1.2546, having hit a low of 1.2479 on Tuesday, it’s lowest since July 7. Investors’ attention will remain on the geopolitical developments. Immediate resistance is located at 1.2623, a break above could take it near 1.2670. On the downside, support is seen at 1.2489 (21-DMA), a break below targets 1.2457. Against the euro, the pound was trading 0.5 percent down at 91.35 pence, having hit a low of 91.37 earlier, it’s lowest since June 30.
AUD/USD: The Australian dollar eased as coronavirus cases surged to more than 14 million people worldwide, adding to concerns over the recovery of the global economy from the effects of the pandemic. The major trades 0.05 percent down at 0.6990, having hit a high of 0.7037 on Wednesday, it’s highest since June 10. Investors will continue to track overall market sentiment. Immediate resistance is located at 0.7023, a break above could take it near 0.7064. On the downside, support is seen at 0.6945 a break below targets 0.6923.
Equities Recap
Asian shares surged as risk sentiment improved after Dutch Prime Minister Mark Rutte said EU leaders were making progress on a plan to revive their economies, even as coronavirus cases increased in many countries.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.3 percent.
Tokyo's Nikkei surged 0.1 percent to 22,717.48 points, Australia's S&P/ASX 200 index eased 0.5 percent to 6,001.60 points. South Korea's KOSPI fell 0.1 percent to 2,198.20 points.
Shanghai composite index rose 3.05 percent to 3,310.93 points, while CSI 300 index traded 2.9 percent up at 4,676.07 points.
Hong Kong’s Hang Seng traded 0.1 percent higher at 25,118.10 points. Taiwan shares shed 0.06 percent to 12,174.54 points.
Commodities Recap
Crude oil prices declined, unnerved by the prospect that a recovery in fuel demand could be derailed by a rise in the pace of coronavirus infections around the world. International benchmark Brent crude was trading 0.5 percent down at $42.85 per barrel by 0545 GMT, having hit a high of $43.82 on Wednesday, its highest since June 23. U.S. West Texas Intermediate was trading 0.6 percent lower at $40.32 a barrel, after rising as high as $41.24 on Wednesday, its highest since June 23.
Gold prices edged lower but worries over a surge in coronavirus cases and its impact on the global economy kept the safe-haven metal above the psychological level of $1,800 per ounce. Spot gold was trading 0.05 percent down at $1,809.55 per ounce by 0554 GMT, having hit a high of $1,818.09 earlier in the month, its highest since September 2011. U.S. gold futures were steady at $1,809.70.
Treasuries Recap
The U.S. Treasury yields edged lower, with the benchmark 10-year note yield trading at 0.627 percent.
