Market Roundup
- Oil prices slide on demand concerns
- Gold steady as U.S.-China tensions resurface
Economic Data Ahead
- (0400 ET/0800 GMT) EZ Markit Manufacturing PMI(Apr)
- (0430 ET/0830 GMT) EZ Sentix Investor Confidence(May)
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index rebounded from a 1-month low after U.S. Secretary of State Mike Pompeo said on Sunday there was a significant amount of evidence that the virus emerged from a Chinese laboratory. The greenback against a basket of currencies traded 0.7 percent up at 99.37, having touched a low of 98.57 earlier, its lowest since Mar. 30.
EUR/USD: The euro plunged after rising to a 1-month peak in the previous session, as the greenback surged after U.S. President Donald Trump threatened to impose tariffs on China. The European currency traded 0.4 percent down at 1.0932, having touched a high of 1.1019 on Friday, its highest since April 1. Investors’ attention will remain on a series of economic data from the Eurozone economies and EZ Sentix investor confidence, ahead of the U.S. factory orders and ISM-NY Business conditions index. Immediate resistance is located at 1.0978, a break above targets 1.1020. On the downside, support is seen at 1.0910, a break below could drag it below 1.0889 (5-DMA).
USD/JPY: The dollar declined, extending previous session losses as a U.S.-China spat over the origin of the coronavirus offset optimism about an economic re-start as countries around the world ease restrictions. On Friday, U.S. President Donald Trump said that raising tariffs on China is certainly an option as he considers ways to retaliate for the spread of the coronavirus out of Wuhan, China. The major was trading 0.1 percent down at 106.73, having hit a low of 106.35 on Wednesday, its lowest since Mar. 17. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. factory orders and ISM-NY Business conditions index. Immediate resistance is located at 107.05, a break above targets 107.28 (10-DMA). On the downside, support is seen at 106.60, a break below could take it near at 106.35.
GBP/USD: Sterling extended losses below the 1.2500 handle, weighed down by stalled Brexit talks and further signs of damage to Britain’s economy from the coronavirus pandemic. The major traded 0.3 percent down at 1.2424, having hit a high of 1.2643 on Thursday, it’s highest since April 14. Investors’ attention will remain on the geopolitical developments ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2518, a break above could take it near 1.2565. On the downside, support is seen at 1.2415 (10-DMA), a break below targets 1.2377. Against the euro, the pound was trading flat at 87.85 pence, having hit a low of 88.02 earlier, it’s lowest since April 22.
AUD/USD: The Australian dollar plunged to a 1-week trough as U.S. President Donald Trump and Secretary of State Mike Pompeo added to worries with fresh efforts to pin the blame for the pandemic on China, where the new coronavirus outbreak is believed to have originated. The Aussie trades 0.3 percent down at 0.6396, having hit a low of 0.6372 earlier, it’s lowest since Apr. 24. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.6442, a break above could take it near 0.6487 (5-DMA). On the downside, support is seen at 0.6358, a break below targets 0.6339 (21-DMA).
Equities Recap
Asian shares declined, weighed down by the threat of fresh trade-war hostilities between the U.S. and China.
MSCI's broadest index of Asia-Pacific shares outside Japan plunged 2.5 percent.
Australia's S&P/ASX 200 index rallied 1.4 percent to 5,319.80 points and South Korea's KOSPI declined 2.7 percent to 1,895.37 points.
Hong Kong’s Hang Seng traded 3.4 percent lower at 23,663.06 points. Taiwan shares shed 2.5 percent to 10,720.48 points.
Commodities Recap
Crude oil prices declined on worries a global oil glut may persist amid slumping demand and U.S.-China trade tensions that could restrict an economic recovery even as coronavirus pandemic lockdowns start to ease. International benchmark Brent crude was trading 2.3 percent lower at $25.98 per barrel by 0552 GMT, having hit a high of $27.86 on Friday, its highest since April 20. U.S. West Texas Intermediate was trading 7.8 percent up at $21.26 a barrel, after rising as high as $22.02 earlier in the session, its highest since April 14.
Gold prices eased, reversing some of its previous session gains, as the dollar firmed, although rising U.S.-China tensions over the coronavirus kept bullion underpinned near the key $1,700 level. Spot gold was trading 0.2 percent down at $1,697.25 per ounce by 0556 GMT, having touched a low of $1,670.90 on Friday, its lowest since Apr. 21. However, the metal gained nearly 1 percent on Friday after U.S. President Donald Trump threatened to impose tariffs on China. U.S. gold futures gained 0.5 percent to $1,708.80 per ounce.
Treasuries Recap
On Friday, the benchmark 10-year yield was last up 1.4 basis point at 0.6386 percent. The two-year U.S. Treasury yield was 1.4 basis points higher at 0.2018 percent.
