Europe Roundup: Sterling falls to 12-day low as greenback flexes its muscles ,European shares tumble, Gold pares losses, U.S. oil futures plumb historic lows below zero-April 21st,2020

Market Roundup

• Investors focus on EU meeting on Thursday

• Italian 10-year yield hits 2%; new bonds set to price

• German yields drop as investors seek safety

• UK Feb Average Earnings ex Bonus 2.9%,3.0% forecast, 3.1% previous

• UK Feb Average Earnings Index +Bonus 2.8%,3.0% forecast, 3.1% previous

• UK March Claimant Count Change 12.1K, 172.5K forecast, 5.9K previous

• UK Feb Employment Change 3M/3M (MoM) 172K, 100K forecast, 184K previous

• German April ZEW Current Conditions -91.5, -77.5 forecast, -43.1 previous

• German April ZEW Economic Sentiment 28.2, -42.3 forecast, -49.5 previous

• German April ZEW Economic Sentiment 25.2, -49.5 previous

• Belgium April Consumer Confidence -26, -9 previous

Looking Ahead - Economic Data (GMT)

• 12:30 Canada Feb Core Retail Sales (MoM) 0.3% forecast, -0.1% previous

• 12:30 Canada Feb Retail Sales (MoM) 0.2% forecast, 0.4% previous

• 12:55 US Redbook (YoY) -2.0% previous

• 12:55 US Redbook (MoM) -8.3% previous

• 14:00 US March Existing Home Sales 5.30M forecast, 5.77M previous

• 14:00 US Existing Home Sales (MoM) -8.1% forecast, 6.5% previous

•15:20 New Zealand GlobalDairyTrade Price Index 1.2% previous

• 20:40 US API Weekly Crude Oil Stock 13.143M previous

Looking Ahead - Economic events and other releases (GMT)

• No significant events

Fxbeat

EUR/USD: The euro declined against the U.S. dollar on Tuesday as investors cautiously awaited European Union summit later this week on how the EU will try to revive an economy hit by the pandemic. The EU summit will see member countries try to agree a package to revive an economy hit by the coronavirus pandemic. German Chancellor Angela Merkel signalled readiness on Monday to finance economic recovery in Europe through a bigger EU budget and the issuance of joint debt via the European Commission. Immediate resistance can be seen at 1.0893 (9 DMA), an upside break can trigger rise towards 1.0910 (21 DMA).On the downside, immediate support is seen at 1.0808 (9 DMA), a break below could take the pair towards 1.0741(Lower BB).

GBP/USD: The pound declined against the dollar on Tuesday as better-than-expected UK unemployment data had little impact on economic sentiment. Unemployment benefit claims increased by 12,100 in March, far below the median forecast of 172,500. But the data is based on the situation on March 12, 11 days before the government declared the lockdown that has paralysed much of Britain’s economy. So the reading had little effect on a market driven by the dollar’s strength due a plunge in oil prices that on Monday pushed crude futures to below zero for the first time. Immediate resistance can be seen at 1.2355 (21 DMA), an upside break can trigger rise towards 1.2420 (5 DMA).On the downside, immediate support is seen at 1.2292 (50% fib), a break below could take the pair towards 1.2082 (lower BB).

USD/CHF: The dollar rose against the Swiss franc on Tuesday, as investors sought a safety in greenback after a plunge in oil prices a day earlier. U.S. crude oil futures plunged into negative territory for the first time on Monday, dragged by a supply glut and sagging demand due to the novel coronavirus pandemic though they managed to scrape back into positive territory early Tuesday. At (GMT 12:00), greenback edged higher 0.30% versus the Swiss franc to 0.9708. Immediate resistance can be seen at 0.9729 (23.6% fib), an upside break can trigger rise towards 0.9796 (200 DMA).On the downside, immediate support is seen at 0.9660 (30 DMA), a break below could take the pair towards 0.9657 (21 DMA).

USD/JPY: The dollar declined against the Japanese yen on Tuesday, as a plunge in oil prices underscored deep economic ructions from the coronavirus pandemic. U.S. oil prices fell into a negative territory for the first time ever on Monday, while international crude prices continued to decline as COVID-19 severely curbed demand and saw the market flushed with supply. Strong resistance can be seen at 107.88 (11 DMA), an upside break can trigger rise towards 108.31 (21 DMA).On the downside, immediate support is seen at 107.00 (Psychological level), a break below could take the pair towards 106.35 (lower BB).

Equities Recap

European stocks fell on Tuesday as the double whammy from a historic plunge in U.S. crude to below zero and lackluster quarterly earnings reports spooked investors about the lasting damage to the global economy from the coronavirus pandemic.

At (GMT 12:10),UK's benchmark FTSE 100 was last trading lower at 2.27 percent, Germany's Dax was down by 3.35 percent, France’s CAC finished was down by 3.00 percent.

Commodities Recap

Gold recovered from early losses on Tuesday as a rout in oil prices boosted demand for safe haven assets and countering the impact of a rise in the dollar.

Spot gold was steady at $1,692.77 per ounce by 0818 GMT, having slipped 0.5%. U.S. gold futures were steady at $1,711.80.

U.S. oil futures traded in negative territory on Tuesday, after sinking nearly $40 the previous session in their first ever dive below zero, as concern grew the sector will run out of storage for a glut caused by the coronavirus lockdown.

U.S. West Texas Intermediate (WTI) crude for May delivery traded at minus $2.58 a barrel by 0807 GMT, up $35.05 from Monday’s close when the contract settled at a discount of $37.63 a barrel.

Treasury Recap

Italian bond yields rose on Tuesday, with the 10-year yield climbing above 2% for the first time since mid-March, as an oil price crash sent traders looking for safety and investors awaited a key European Union summit later this week.

Italian yields rose, with the 10-year yield up as much as 5 basis points at 2.006%, its highest since before the ECB announced its emergency purchase programme. The 10-year German bond yield dropped 5 basis points to -0.495%.