Market Roundup
- Gold gains on fears about second wave of infections
- Fed officials talk down the prospect of negative rates
Economic Data Ahead
- No Major Economic Data Scheduled
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index eased after rising to a 2-1/2 week peak earlier in the day after U.S. Federal Reserve officials downplayed the likelihood of negative interest rates. The greenback against a basket of currencies traded 0.1 percent down at 100.14, having touched a high of 100.44 earlier, its highest since April 24.
EUR/USD: The euro surged after research from the European Central Bank suggested that the impact of euro exchange rate movements on inflation has declined, and its impact on eurozone consumer prices is close to insignificant. The European currency traded 0.05 percent up at 1.0812, having touched a low of 1.0766 on Thursday, its lowest since April 24. Investors’ attention will remain on a series of economic data from the Eurozone economies, ahead of the U.S. consumer price index and Fed Quarles speech. Immediate resistance is located at 1.0838, a break above targets 1.0861. On the downside, support is seen at 1.0766, a break below could drag it below 1.0727.
USD/JPY: The dollar declined after rising to a 2-1/2 week peak in the prior session, as growing fears about a second wave of coronavirus infections dented a global recovery and stoked fresh signs of trade tensions. The major was trading 0.1 percent eased at 107.50, having hit a low of 105.98 on Wednesday, its lowest since Mar. 17. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. consumer price index and Fed Quarles speech. Immediate resistance is located at 107.76, a break above targets 107.93. On the downside, support is seen at 107.15, a break below could take it near at 106.89.
GBP/USD: Sterling nudged lower as investors turned cautious about the easing of coronavirus lockdown measures in Britain. The major traded 0.05 percent down at 1.2327, having hit a low of 1.2266 on Thursday, it’s lowest since April 21. Investors’ attention will remain on the geopolitical developments ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2371 (5-DMA), a break above could take it near 1.2418. On the downside, support is seen at 1.2266, a break below targets 1.2247. Against the euro, the pound was trading 0.2 percent down at 87.75 pence, having hit a low of 88.06 on Monday, it’s lowest since May 4.
AUD/USD: The Australian dollar tumbled, extending previous session losses after China banned some Australian meat imports. Australia’s trade minister said that China’s ban on some of its meat exports was not due to Canberra leading a push for an inquiry into the origins of the coronavirus. The Aussie trades 0.3 percent down at 0.6467, having hit a low of 0.6378 on Thursday, it’s lowest since May 4. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.6514, a break above could take it near 0.6530. On the downside, support is seen at 0.6419, a break below targets 0.6399.
Equities Recap
Asian shares plunged amid growing worries about a second wave of coronavirus infections after the Chinese city of Wuhan reported its first new cases since its lockdown was lifted.
MSCI's broadest index of Asia-Pacific shares outside Japan slumped 1.0 percent.
Tokyo's Nikkei fell 0.2 percent to 20,366.48 points, Australia's S&P/ASX 200 index declined 1.1 percent to 5,403.00 points. South Korea's KOSPI eased 0.7 percent to 1,922.17 point.
Shanghai composite index fell 0.1 percent to 2,891.56 points, while CSI 300 index traded 0.05 percent up at 3,960.24 points.
Hong Kong’s Hang Seng traded 1.5 percent lower at 24,236.90 points. Taiwan shares shed 1.2 percent to 10,879.47 points.
Commodities Recap
Crude oil prices declined, extending previous session losses, as the market wary of the second wave of COVID-19 cases that could result in new lockdowns and stall a recovery in demand. International benchmark Brent crude was trading 0.3 percent lower at $29.84 per barrel by 0555 GMT, having hit a high of $32.20 on Wednesday, its highest since April 14. U.S. West Texas Intermediate was trading 0.05 percent down at $25.39 a barrel, after rising as high as $27.95 on Wednesday, its highest since April 9.
Gold prices surged as the metal’s safe-haven appeal was boosted by growing worries about a second wave of coronavirus infections after some countries reported a jump in new cases. Spot gold rose 0.2 percent to $1,701.72 per ounce by 0559 GMT, having touched a high of $1,723.65 on Friday, its highest since Apr. 27. U.S. gold futures climbed 0.2 percent to $1,701.80 per ounce.
Treasuries Recap
On Monday, the 2-year U.S. Treasury yield was up 2.8 basis points at 0.1768 percent. The benchmark 10-year yield was up 3.9 basis points at 0.7195 percent.
