Europe Roundup: Sterling rises after BoE rate decision, European shares slide, Gold inches up, Oil falls more than 2%-January 30th,2020

 Market Roundup

• EU Jan Business and Consumer Survey 102.8, 101.8 forecast, 101.3  previous

• EU Jan Business Climate -0.23, -0.19 forecast, -0.32 previous

• EU Jan Consumer Inflation Expectation 20.7, 20.5 previous

• Belgium Jan CPI (YoY) 1.41%,0.76% previous

• Belgium Jan CPI (MoM) 0.60%, 0.13% previous    

• Spanish Business Confidence -5.6, -1.9 previous    

• UK Jan BoE Interest Rate Decision 0.75%, forecast 0.75%, 0.75% previous

• German Jan CPI (MoM)  -0.6%,-0.6% forecast, 0.5% previous

• German Jan  HICP (YoY) 1.6%,1.7% forecast, 1.5%  previous  
            
Looking Ahead - Economic Data (GMT)

• 13;30 US Continuing Jobless Claims 1,733K forecast, 1,731K  previous

• 13;30 US Core PCE Prices (Q4)  1.70%,2.10% previous

• 13;30 US GDP (QoQ) (Q4) 2.1% forecast, 2.1% previous

• 13;30 US GDP Sales (Q4) 2.1% forecast, 2.1% previous

• 13;30 US Initial Jobless Claims 215K forecast, 211K  previous

• 13;30 US Jobless Claims 4-Week Avg  213.25K previous

• 13;30 US Real Consumer Spending (Q4) 3.2% previous

• 14:00  Belgian GDP (QoQ) (Q4) 0.3% , 0.4% previous

Looking Ahead - Events, Other Releases (GMT)    

•18:00 German Buba President Weidmann Speaks          

Fx Beat

EUR/USD: The euro strengthened against the U.S. dollar on Thursday, as worries about the spread of a new virus from China sent investors heading for safety. The Federal Reserve kept interest rates unchanged on Wednesday, as expected, although bank Chairman Jerome Powell’s comments about a low inflation outlook added to U.S. government bonds’ appeal. Elsewhere, risk currencies and oil paused their recent slide as investors assessed the possible fallout from the virus. The euro was up 0.12% versus the U.S. currency at $1.1023.Immediate resistance can be seen at 1.1068 (50 DMA), an upside break can trigger rise towards 1.1090 (100 DMA).On the downside, immediate support is seen at 1.0990 (Lower BB), a break below could take the pair towards 1.0938  (Oct 8th low).

GBP/USD: Sterling rose against dollar on Thursday, after Bank of England kept rates on hold. The Bank of England kept interest rates steady, saying signs that Britain’s economy had picked up since December’s election, and of a stabler global economy, meant more stimulus was not needed now. Financial markets had seen a 50% chance of a cut but the Monetary Policy Committee split once again 7-2 in favour of keeping Bank Rate at 0.75% with external members Michael Saunders and Jonathan Haskel again voting to lower rates. The pound rose 0.53% o hit  daily high at $1.3096, it was last trading at $1.3086 . Immediate resistance can be seen at 1.3159 (Higher BB), an upside break can trigger rise towards 1.3200 (Psychological level).On the downside, immediate support is seen at 1.2978 (Daily low), a break below could take the pair towards 1.2850 (100 DMA).

USD/CHF: The dollar declined against the Swiss franc on Thursday, as concern epidemic worries in China stoking demand for the perceived security of safe-haven assets like Japanese yen and Swiss franc. The number of confirmed deaths from the virus in China has climbed to 170 with 7,711 people infected, and more cases are being reported around the world. At (GMT 12:19), Greenback dipped 0.28% versus the Swiss franc to 0.9704. Immediate resistance can be seen at 0.9719 (30 DMA), an upside break can trigger rise towards 0.9750 (Higher BB).On the downside, immediate support is seen at 0.9699 (9 DMA), a break below could take the pair towards 0.9674 (Jan 28th low).

USD/JPY: The dollar declined against the Japanese yen on Thursday, as investors switched to the shelter of the Japanese yen. The yen firmed 0.1% to 108.76 yen per dollar, edging close to a three-week high of 108.73 touched last week. The Japanese currency has fallen 0.3% against the dollar so far this month but risen against most others, adding 1.6% versus the euro and 3.9% on the Australian dollar. Strong resistance can be seen at 109.00 (5 DMA), an upside break can trigger rise towards 109.51 (11 DMA).On the downside, immediate support is seen at 108.71 (100 DMA), a break below could take the pair towards 108.13 (Lower BB). 

Equities Recap

European shares fell for the first time in three sessions on Thursday on a slate of disappointing earnings updates, with investors also fretting over the economic impact of a virus epidemic in China that has now claimed 170 lives.
    
 At (GMT 12:55),UK's benchmark FTSE 100 was last trading lower at 1.45 percent, Germany's Dax was down by 1.23 percent, France’s CAC was last down by 1.58 percent.

Commodities Recap

Gold prices edged higher on Thursday after the U.S. Federal Reserve Chair’s remarks that the new coronavirus outbreak could impact China’s economy in the short term boosted the safe-haven metal’s appeal.

Spot gold rose 0.1% to $1,577.64 per ounce by 0613 GMT and U.S. gold futures gained 0.5% to $1,577.90.

Oil prices fell on Thursday on concerns over the potential economic impact of the coronavirus that continues to spread worldwide, while the market also considered the possibility of an early OPEC meeting.

Brent crude  was down $1.51, or 2.52%, at $58.30 a barrel by 1129 GMT, having risen 0.5% on Wednesday. U.S. crude   was down $1.26 cents, or 2.36%, at $52.07 after dropping 0.3% in the previous session.    

Treasuries Recap

U.S.: The U.S. Treasuries gained during Thursday’s afternoon session ahead of the country’s gross domestic product (GDP) for the fourth quarter of this year, due to be delivered today by 13:30GMT, in addition to the weekly initial jobless claims, also scheduled for today by 13:30GMT. The yield on the benchmark 10-year Treasury yield slumped 2-1/2 basis points to 1.569 percent, the super-long 30-year bond yield lost 2 basis points to 2.032 percent and the yield on the short-term 2-year remained 1 basis point down at 1.407 percent.

EUR: The German bunds surged during European trading session Thursday after the country’s unemployment change for the month of January made investors cheerful ahead of the eurozone’s consumer price inflation (CPI) for the similar period, scheduled to be released on January 31 by 10:00GMT. The German 10-year bond yield, which moves inversely to its price, slumped nearly 3 basis points to -0.399 percent, the long-term 30-year yield lost 2-1/2 basis points to 0.110 percent and the yield on short-term 2-year suffered 1-1/2 basis points to -0.653 percent.

AUS: The Australian bonds jumped during Asian session Thursday, tracking a similar movement in the U.S. Treasuries after the Federal Reserve kept the fed funds rate unchanged in a range between 1.5-1.75 percent at the conclusion of its monetary policy meeting late Wednesday. This safe-haven demand from investors remained intact as China and its global peers struggle to tackle the deadly coronavirus that has challenged the lives of millions of people, with many countries being put on high alert before the virus creeps into. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, plunged 7-1/2 basis points to 0.955 percent, the yield on the long-term 30-year bond slumped 8 basis points to 1.558 percent and the yield on short-term 2-year lost 6 basis points to trade at 0.659 percent.