Market Roundup
- Oil prices fall as rising coronavirus cases raised demand concerns
- Gold steadies amid concerns over virus case spike
- Australia jobless rate surges to 19-year high in May
Economic Data Ahead
- (0400 ET/0800 GMT) Italy Global Trade Balance(Apr)
- (0400 ET/0800 GMT) Italy Trade Balance EU(Apr)
Key Events Ahead
- (0400 ET/0800 GMT) EZ Economic Bulletin
- (0400 ET/0800 GMT) SNB Press Conference
FX Beat
DXY: The dollar index consolidated within narrow ranges, as investors remained on the sidelines amid a spike in new coronavirus infections and hospitalisations in several parts of the United States over the last two weeks. The greenback against a basket of currencies traded 0.1 percent down at 97.00, having touched a low of 95.72 on Wednesday, its lowest since March 10.
EUR/USD: The euro steadied after tumbling in the prior session on data showing Eurozone inflation slowed further year-on-year in May, weighed down by falling energy prices. The European currency traded 0.1 percent up at 1.1250, having touched a low of 1.1207 on Wednesday, its lowest since June 4. Investors’ attention will remain on a series of data from Eurozone economies, and EZ Economic Bulletin, ahead of U.S. unemployment claims and Philadelphia Fed Manufacturing Survey. Immediate resistance is located at 1.1301 (10-DMA), a break above targets 1.1340. On the downside, support is seen at 1.1194, a break below could drag it below 1.1163 (21-DMA).
USD/JPY: The dollar declined to a near 1-week low amid a surge in new coronavirus infections in several U.S. states and the imposition of travel curbs in Beijing to stop a separate outbreak. The major was trading 0.1 percent down at 106.87, having hit a low of 106.70 earlier, its lowest since June 12. Investors’ will continue to track the broad-based market sentiment, ahead of U.S. unemployment claims and Philadelphia Fed Manufacturing Survey. Immediate resistance is located at 107.33, a break above targets 107.78 (10-DMA). On the downside, support is seen at 106.57, a break below could take it near at 105.99.
GBP/USD: Sterling eased, extending losses for the third straight session, as investors cautiously await the Bank of England’s policy meeting outcome later in the day. The BoE is likely to boost its quantitative easing programme by 100 billion pounds ($125 billion), with some analysts expect even larger increase amid concerns about the economic outlook. The major traded 0.1 percent down at 1.2539, having hit a low of 1.2454 on Monday, it’s lowest since June 1. Investors’ attention will remain on the geopolitical developments ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2632 (10-DMA), a break above could take it near 1.2680. On the downside, support is seen at 1.2510, a break below targets 1.2475 (21-DMA). Against the euro, the pound was trading 0.2 percent down at 89.68 pence, having hit a low of 90.24 on Monday, it’s highest since May 29.
AUD/USD: The Australian dollar slumped after data showed the economy shed a quarter of a million jobs and the jobless rate jumped to the highest in almost two decades in May. The country's employment in May plunged a further 227,700 after a record slump of about 600,000 in April, while the unemployment rate rose to 7.1 percent, the highest since October 2001, from an upwardly revised 6.4 percent in April. The Aussie trades 0.2 percent down at 0.6871, having hit a low of 0.6776 on Monday, it’s lowest since June 2. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.6930 (10-DMA), a break above could take it near 0.6970. On the downside, support is seen at 0.6796, a break below targets 0.6776.
Equities Recap
Asian shares plunged as increasing coronavirus cases in some U.S. states and China offset hopes of a quick global economic recovery from the pandemic.
MSCI's broadest index of Asia-Pacific shares outside Japan slumped 1.0 percent.
Tokyo's Nikkei declined 0.5 percent to 22,355.46 points, Australia's S&P/ASX 200 index fell 0.9 percent to 5,936.50 points. South Korea's KOSPI tumbled 0.5 percent to 2,130.83 points.
Shanghai composite index rose 0.1 percent to 2,940.03 points, while CSI 300 index traded 0.7 percent up at 4,044.17 points.
Hong Kong’s Hang Seng traded 0.2 percent lower at 24,426.24 points. Taiwan shares added 0.1 percent to 11,548.33 points.
Commodities Recap
Crude oil prices declined as a spike in new coronavirus cases in China and the United States renewed fears that recovery in fuel demand could stall. International benchmark Brent crude was trading 0.1 percent lower at $40.46 per barrel by 0529 GMT, having hit a low of $36.98 on Friday, its lowest since May 29. U.S. West Texas Intermediate was trading 0.3 percent down at $37.56 a barrel, after falling as low as $34.38 on Monday, its lowest since May 29.
Gold prices gained as worries over new coronavirus cases delaying economic recovery weighed on market sentiment. Spot gold was trading 0.1 percent up at $1,728.41 per ounce by 0536 GMT, having touched a high of $1,744.91 last week, its highest since June 2. U.S. gold futures were nearly unchanged at $1,734.70.
Treasuries Recap
The U.S. Treasury yields edged down, with the key 10-year note yield last trading at 0.708 percent, compared to Wednesday’s U.S. close of 0.733 percent.
The Japanese government bond prices rebounded amid fears of a fresh wave of coronavirus infections. The benchmark 10-year JGB futures rose 0.06 point to 152.12, while the key 10-year cash bond yield fell one basis point to 0.005 percent. The 5-year cash JGB yield slipped half a basis point to minus 0.115 percent. In the super-long zone, the 20-year JGB yield eased half a basis point to 0.385 percent, while the 30-year and the 40-year yields gained one basis point each to 0.560 percent and 0.580 percent, respectively.
