Market Roundup
- Oil prices rise on Iraq output cut
- Gold eases as dollar holds onto gains
Economic Data Ahead
- (0430 ET/0830 GMT) EZ Sentix Investor Confidence(Aug)
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index surged after President Trump signed a series of executive orders to extend unemployment benefits, providing an extra $400 per week in unemployment payments. The greenback against a basket of currencies traded 0.1 percent up at 93.49, having touched a low of 92.52 on Thursday, its lowest since May 2018.
EUR/USD: The euro steadied after tumbling nearly 0.8 percent in the previous session, as investors awaited European Union economic data, which is expected to boost investor sentiment. The European currency traded 0.1 percent higher at 1.1794, having touched a high of 1.1916 on Thursday, its highest since May 2018. Investors’ attention will remain on a series of data from Eurozone economies and EZ Sentix investor confidence, ahead of the U.S. JOLTS Job Opening figures. Immediate resistance is located at 1.1848, a break above targets 1.1883. On the downside, support is seen at 1.1731, a break below could drag it below 1.1695.
USD/JPY: The dollar eased from near 1-week peak as investors were wary of a fresh flare up in U.S.-China tensions ahead of the trade talks scheduled for August 15 even as Washington imposed sanctions on senior Hong Kong and Chinese officials. The major was trading 0.1 percent down at 105.78, having hit a high of 106.05 on Friday, its highest since August 3. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. JOLTS Job Opening figures. Immediate resistance is located at 106.25 (21-DMA), a break above targets 106.56. On the downside, support is seen at 105.46 (10-DMA), a break below could take it near at 105.24.
GBP/USD: Sterling consolidated within ranges as investors speculated the possibility of negative interest rates. Last week the Bank of England struck a less pessimistic tone about the coronavirus-battered British economy. Britain’s transition period with the European Union is due to end on December 31, after which it will leave the single market and customs union. The major traded flat at 1.3052, having hit a high of 1.3185 on Thursday, it’s highest since March 9. Investors’ attention will remain on the geopolitical developments, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.3110, a break above could take it near 1.3147. On the downside, support is seen at 1.3004, a break below targets 1.2977. Against the euro, the pound was trading 0.1 percent up at 90.17 pence, having hit a high of 89.80 on July 31, it’s highest since July 13.
AUD/USD: The Australian dollar declined, extending previous session slump amid deteriorating U.S.-China relations. However, data showing a slowing in China’s factory deflation boosted hopes of economic recovery in the Chinese economy. The Aussie trades 0.1 percent lower at 0.7153, having hit a high of 0.7243 on Friday, it’s highest since Feb. 6. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.7197, a break above could take it near 0.7241. On the downside, support is seen at 0.7133, a break below targets 0.7095 (21-DMA).
Equities Recap
Asian shares consolidated within ranges as worries over rising tensions between the United States and China weighed on sentiment, although signs of a recovery in Chinese industrial activity limited losses.
MSCI’s broadest index of Asia-Pacific shares outside Japan stayed below a 6-1/2 month peak touched last week.
Japanese and Singapore markets were closed for public holidays.
Australia's S&P/ASX 200 index rallied 1.8 percent to 6,110.20 points. South Korea's KOSPI gained 1.5 percent to 2,386.38 points.
Shanghai composite index rose 0.8 percent to 3,379.25 points, while CSI 300 index traded 0.4 percent up at 4,724.87 points.
Hong Kong’s Hang Seng traded 0.6 percent lower at 24,396.09 points. Taiwan shares added 0.5 percent to 12,894.00 points.
Commodities Recap
Crude oil prices surged, supported by Saudi optimism on Asian demand and an Iraqi pledge to deepen supply cuts, although uncertainty over a deal to shore up the U.S. economic recovery limited upside. International benchmark Brent crude was trading 0.4 percent up at $44.83 per barrel by 0609 GMT, having hit a high of $46.21 on Wednesday, its highest since March 6. U.S. West Texas Intermediate was trading 0.6 percent higher at $41.80 a barrel, after rising as high as $43.50 on Wednesday, its highest since March 6.
Gold prices declined, extending previous session losses as the dollar held onto gains made after better-than-expected U.S. payrolls data, while investors kept a close eye on U.S.-China relations ahead of scheduled trade talks. Spot gold was trading 0.1 percent down at $2,033.97 per ounce by 0612 GMT, having hit an all-time high of $2,075.28 on Friday. U.S. gold futures rose 0.6 percent to $2,039.20.
Treasuries Recap
The U.S. Treasury yields edged higher, with the benchmark 10-year note yield trading at 0.574 percent.
