Market Roundup
- Gold steadies as market eyes Trump's health
- Oil prices recover 2 percent
- Australia business conditions, confidence pick up
Economic Data Ahead
- (0400 ET/0800 GMT) EZ Markit Services PMI(Sep)
- (0400 ET/0800 GMT) EZ Markit PMI Composite(Sep)
- (0500 ET/0900 GMT) EZ Producer Price Index (YoY)(Aug)
- (0500 ET/0900 GMT) EZ Retail Sales (YoY)(Aug)
- (0500 ET/0900 GMT) EZ Retail Sales (MoM)(Aug)
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index eased amid growing expectations that U.S. Congress will pass a stimulus package to support the pandemic-stricken economy ahead of the presidential election in November. The greenback against a basket of currencies traded 0.05 percent down at 93.78, having touched a low of 93.53 on Thursday, its lowest since September 22.
EUR/USD: The euro rose, reversing most of its previous session losses, as data released last week showed the recovery in euro zone manufacturing activity gathered pace last month, largely driven by strength in Germany, although rising coronavirus cases across the region may yet reverse the upturn. Last week, the major eased from a 1-week peak after the European Commission said in a paper, continued appreciation of the euro’s nominal effective exchange rate could hurt the euro zone’s economic recovery and make the task of boosting inflation more difficult for the European Central Bank. The European currency traded 0.2 percent up at 1.1734, having touched a high of 1.1769 on Thursday, its highest since September 22. Investors’ attention will remain on series of economic data from the Eurozone economies, EZ Markit service PMI, retail sales and Sentix investor confidence, ahead of the U.S. service PMI by both Markit and ISM. Immediate resistance is located at 1.1773, a break above targets 1.1800. On the downside, support is seen at 1.1684, a break below could drag it below 1.1651.
USD/JPY: The dollar surged, rebounding from a near 2-week low hit in the prior session, lifted by comments from doctors for U.S. President Donald Trump suggesting he could be discharged from hospital as soon as Monday after he was tested positive for the coronavirus. On Sunday, doctors treating Trump for COVID-19 told reporters they are monitoring the condition of his lungs after he received supplemental oxygen. The major was trading 0.3 percent up at 105.57, having hit a low of 104.94 on Friday, its lowest since September 23. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. service PMI by both Markit and ISM. Immediate resistance is located at 105.80, a break above targets 106.10. On the downside, support is seen at 105.09, a break below could take it near at 104.84.
GBP/USD: Sterling consolidated near a 2-week peak hit last week, as investors awaited cues from final round of Brexit trade negotiations as the expiry of the transition period at the end of December approached. Both British Prime Minister Boris Johnson and the EU set a mid-October goal for reaching a trade agreement, but the EU’s chief Brexit negotiator Michel Barnier suggested talks would continue up until the end of the month. The major traded flat at 1.2929, having hit a high of 1.2978 on Thursday, it’s highest since September 18. Investors’ attention will remain on the geopolitical developments, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2999, a break above could take it near 1.3030. On the downside, support is seen at 1.2881 (5-DMA), a break below targets 1.2854. Against the euro, the pound was trading 0.2 percent down at 90.70 pence, having hit a high of 90.25 last week, it’s highest since September 8.
AUD/USD: The Australian dollar rose after a measure of domestic business conditions rose in September to levels not seen since the coronavirus pandemic forced a nationwide lockdown. National Australia Bank's index of business conditions rose 6 points to 0 from -6 in August, while the survey's measure of business confidence picked, rising to -4 from -8 in August. Markets now await the Reserve Bank of Australia policy meeting on Tuesday. The Aussie trades 0.2 percent up at 0.7174, having hit a high of 0.7209 on Thursday, it’s highest since September 22. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.7210, a break above could take it near 0.7235. On the downside, support is seen at 0.7122 (10-DMA), a break below targets 0.7100.
NZD/USD: The New Zealand dollar rose after Prime Minister Jacinda Ardern stated that coronavirus restrictions in Auckland will be lifted this week, as she expressed confidence a second wave of COVID-19 infections has been almost eliminated. The Kiwi traded 0.2 percent higher at 0.6641, having touched a high of 0.6657 on Thursday, its highest level since September 22. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6670, a break above could take it near 0.6690. On the downside, support is seen at 0.6604 (10-DMA), a break below could drag it below 0.6665.
Equities Recap
Asian shares surged as signs that President Donald Trump’s health was improving eased some of the political uncertainty caused by his coronavirus infection.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.2 percent.
Tokyo's Nikkei gained 1.2 percent to 23,312.14 points, Australia's S&P/ASX 200 index rallied 2.6 percent to 5,941.60 points. South Korea's KOSPI surged 1.5 percent to 2,363.07 points.
Hong Kong’s Hang Seng traded 1.4 percent higher at 23,783.71 points. Taiwan shares added 0.3 percent to 12,548.28 points.
Commodities Recap
Crude oil prices rose about 2 percent, boosted by comments from doctors for U.S. President Donald Trump suggesting he could be discharged from hospital as soon as Monday, just a few days after his positive test for COVID-19. International benchmark Brent crude was trading 2.5 percent up at $40.12 per barrel by 0534 GMT, having hit a low of $38.77 on Friday, its lowest since June 15. U.S. West Texas Intermediate was trading 2.6 percent higher at $37.97 a barrel, after falling as low as $36.66 on Friday, its lowest since September 9.
Gold prices declined, extending previous session losses, as investors sought more clarity on developments in U.S. President Donald Trump’s health after he was tested positive for COVID-19 last week. Spot gold was trading 0.3 percent lower at $1,893.58 per ounce by 0540 GMT, having hit a high of $1917.16 on Friday, its highest since September 22. U.S. gold futures were down 0.3 percent at $1,902.10.
Treasuries Recap
The U.S. Treasury yields rallied, with the benchmark 10-year note yield trading at 0.702 percent and the 30-year yield at 1.497 percent.
