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America’s Roundup: Dollar gains on U.S. election caution, surging COVID-19 cases, U.S. stocks dips, Gold firms, Oil falls on demand concerns, posts second monthly decline-31st October 2020

Market Roundup

• US Sep Personal Income (MoM)  0.9%,0.4%,-2.7% previous

• US Sep Personal Spending (MoM)  1.4%, 1.0%,1.0% previous

• US Sep Real Personal Consumption (MoM) 1.2%,  0.7% previous

• US Employment Cost Index (QoQ) (Q3) 0.5%,0.5% forecast,0.5% previous

• Canada Sep RMPI (MoM) -2.2%,  3.2% previous

• Canada Sep Sep IPPI (YoY)  -2.2% ,-2.3% previous

• US Employment Wages (QoQ) (Q3) 0.40%  ,0.40% previous

• US Employment Benefits (QoQ) (Q3) 0.60%,, 0.80% previous

• US Sep PCE Price index (YoY)  1.4, 1.4 previous

• US Sep PCE price index (MoM)  0.2% ,0.3% previous

• US Sep Core PCE Price Index (YoY) 1.5%, 1.7%forecast, 1.6% previous

• US Sep Core PCE Price Index (MoM) 0.2%, 0.2% forecast,0.3% previous

• Canada Aug GDP (MoM) 1.2%,  0.9% forecast,3.0% previous

• Brazil Sep Budget Balance  -103.420B ,-96.000B forecast,-121.880B previous

• Brazil Sep Budget Surplus  -64.560B ,-74.200B forecast, -87.590B previous

• US Oct Chicago PMI 61.1 ,58.0 forecast, 62.4    previous

• US Oct Michigan Inflation Expectations 2.6%, 2.7% previous

• US Oct Michigan 5-Year Inflation Expectations 2.40%, 2.40% previous

• US Oct Michigan Current Conditions 85.9, 84.9 previous

• US Oct Michigan Consumer Expectations 79.2, 78.8 previous

• US Oct Michigan Consumer Sentiment 81.8, 81.2 forecast, 81.2 previous

• Canada Aug Budget Balance -21.94B, -28.23B previous

• Canada Aug Budget Balance (YoY) -170.52B, -148.58B previous

• US Sep Dallas Fed PCE  0.90% ,2.60% previous

Looking Ahead – Economic Data(GMT)

•No data ahead

Looking Ahead - Economic events and other releases (GMT)

•No significant events

Currencies Summaries

EUR/USD: The euro held near four-week low against the greenback on Friday after the European Central Bank signalled further monetary easing by the end of the year. The ECB kept interest rates steady on Thursday but committed to contain the growing fallout from a second wave of coronavirus infections, saying it would hone its response by its December meeting, as widely expected by the market. The euro was little changed at $1.1676, taking a pause after hitting a four-week low of $1.1650 in U.S. trade overnight. Immediate resistance can be seen at 1.1689 (23.6%fib), an upside break can trigger rise towards 1.1738 (38.2% fib).On the downside, immediate support is seen at 1.1637 (Lower BB), a break below could take the pair towards 1.1600 (Psychological level).

GBP/USD: Sterling traded within a cent’s range against the dollar on Friday, pinned near the $1.29 mark as a lack of news around ongoing Brexit trade negotiations left investors reluctant to bet big on the currency. Britain resumed talks with the European Union over a post-Brexit trade agreement this week. Fisheries and rules governing state subsidies to business are the two critical issues in the negotiations. The pound has largely ignored the on-going Brexit talks, with some analysts saying that even if a Brexit deal were confirmed, it would be unlikely that sterling would benefit handsomely. By 1530 GMT, sterling was up 0.1% against the dollar at $1.2941. Immediate resistance can be seen at 1.2983 (38.2%fib), an upside break can trigger rise towards 1.3019 (9DMA).On the downside, immediate support is seen at 1.2925 (50%fib), a break below could take the pair towards 1.2869 (61.8%fib).

USD/CAD: The Canadian dollar was little changed against its broadly stronger U.S. counterpart on Friday as data showed further recovery in Canada's economy, with the currency steadying after a sharp decline earlier in the week. The Canadian dollar was trading nearly unchanged at 1.3320 to the greenback, having traded in a range of 1.3280 to 1.3348.For the month it was also nearly unchanged, after falling since the start of the week by 1.5%, its biggest weekly decline since April. Immediate resistance can be seen at 1.3334 (38.2%fib), an upside break can trigger rise towards 1.3415 (23.6%fib).On the downside, immediate support is seen at 1.3265 (50%fib), a break below could take the pair towards 1.3195 (61.8%fib).

USD/JPY: The dollar gained against the Japanese yen on Friday as jitters ahead of next week’s U.S. presidential election and the continued surge in global coronavirus boosted appeal for greenback. The greenback posted its largest weekly percentage gain since late September, with investors scooping up dollars due to fears of a contested election and the economic impact of renewed lockdowns in France, Germany and some regions of Spain. Friday’s economic data, meanwhile, which showed U.S. consumer spending exceeding forecasts, had little impact on the currency market.The dollar index rose 0.2% to 94.035. On the week, the index was up 1.4%, its best weekly performance in more than a month. Strong resistance can be seen at 104.71 (9DMA), an upside break can trigger rise towards 104.94 (61.8%fib).On the downside, immediate support is seen at 104.50 (50%fib), a break below could take the pair towards 104.05 (38.2%fib).

Equities Recap

Some strong earnings helped European stocks end higher on Friday, but they posted their sharpest weekly and monthly declines since a brutal selloff in March, as a new round of coronavirus lockdowns dampened prospects for a sustained economic recovery.

UK's benchmark FTSE 100 closed up by 0.06 percent, Germany's Dax ended down  by 0.36 percent, France’s CAC finished the day down by1.31 percent.

U.S. stock index futures tumbled on Friday as dismal business updates from technology mega-caps including Apple Inc fueled investor worries, adding to their concerns about a surge in coronavirus cases.

Dow Jones closed down  by  0.08% percent, S&P 500 closed up by 1.21% percent, Nasdaq settled up by 0.43%  percent.

Treasuries Recap

Longer-dated Treasury debt sold off on Friday afternoon, steepening the yield curve to the widest since June, as investors anticipated the deluge of supply that would come from a post-election stimulus package.

The benchmark 10-year yield was last up 3.1 basis points to 0.867%. The two-year yield remained anchored at 0.154%, which steepened the yield curve.

Commodities Recap

Gold prices rose on Friday, as the dollar retreated, supported by worries of soaring coronavirus cases in the United States and Europe as well as uncertainty over the upcoming U.S. presidential election.

Spot gold rose 0.5% to $1,875.76 per ounce by 357 GMT, but was on track for a third straight month of declines.U.S. gold futures were up 0.5% at $1,877.

Oil prices fell on Friday and posted a second consecutive monthly drop as rising COVID-19 cases in Europe and the United States heightened concerns over the outlook for fuel consumption.

Brent crude   dropped 19 cents to settle at $37.46 a barrel, after touching a five-month low of $36.64 in the previous session. The front-month Brent contract expired on Friday and the January contract   settled down 32 cents.

U.S. West Texas Intermediate (WTI) crude fell 38 cents to settle at $35.79 a barrel, after dipping to its lowest since June on Thursday at $34.92.

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