Market Roundup
• US Feb Dallas Fed Mfg Business Index 1.2, -0.2 previous
• US 3-Month Bill Auction 1.505%, 1.545% previous
• US 6-Month Bill Auction 1.440%, 1.510% previous
Looking Ahead - Economic Data (GMT)
• 23:50 Japan Corporate Services Price Index (CSPI) (YoY) 2.1% previous
• 05:00 Japan Leading Index 91.6 forecast, 90.8 previous
Looking Ahead - Economic events and other releases (GMT)
• 20:00 US FOMC Member Mester Speech
• 14:45 US FOMC Member Kaplan Speech
Currency Summaries
EUR/USD: The euro edged lower against dollar on Monday, as the rapid spread of the coronavirus outside China drove investors to the safety of the U.S. dollar. The euro weakened 0.3% to $1.0826, close to last week's level of $1.0778 a nearly three-year low. The dollar index gained 0.1% to 99.562, remaining close to its highs of 99.915 touched last week. Immediate resistance can be seen at 1.0879 (Daily high), an upside break can trigger rise towards 1.0926 (21 DMA).On the downside, immediate support is seen at 1.0780 (20th Feb low), a break below could take the pair towards 1.0700 (Psychological level).
GBP/USD: Sterling declined against the dollar on Monday as rising fears about the economic impact from the spreading coronavirus encouraged investors to seek safety in the U.S. dollar. The pound has been supported in recent weeks by better-than-expected economic data and growing expectations that the new UK finance minister will announce more spending at next month’s budget. But those gains have been capped because of broad dollar strength and ongoing worries about Britain’s trade negotiations with the European Union. Immediate resistance can be seen at 1.2986 (21 DMA), an upside break can trigger rise towards 1.3004 (30 DMA).On the downside, immediate support is seen at 1.2837 (Lower BB), a break below could take the pair towards 1.2800 (Psychological level).
USD/CAD: The Canadian dollar weakened to a near two-week low against its U.S. counterpart on Monday as spreading of the coronavirus epidemic outside of China worried investors, overshadowing a bigger-than-expected gain for domestic wholesale trade. Canada is a major exporter of commodities, including oil, so its economy could be hurt if spreading of the virus were to slow global economic growth. At (2211 GMT), the Canadian dollar was trading 0.5% lower at 1.3287 to the greenback.Immediate resistance can be seen at 1.3311 (23.6% fib), an upside break can trigger rise towards 1.3327(Higher BB).On the downside, immediate support is seen at 1.3242 (Daily low), a break below could take the pair towards 1.3182 (Lower BB).
USD/JPY: The dollar dipped against the Japanese yen on Monday, as demand for Japanese yen increased as investor worried about rapid spread of the coronavirus outside China. The rapid spread of the coronavirus outside China drove Italy, South Korea and Iran posted sharp rises in infections over the weekend. South Korea now has more than 760 cases, Italy more than 150 and Iran 43 cases. The World Health Organization said it was worried about the growing number without any clear link to the epicentre of the outbreak in China. Strong resistance can be seen at 111.32 (23.6% Fib), an upside break can trigger rise towards 112.23 (Feb 21st high ).On the downside, immediate support is seen at 110.22 (50% Fib), a break below could take the pair towards 109.79 (61.8% Fib).
Equities Recap
European shares hit a record high for the second straight session on Wednesday, as a drop in new coronavirus cases prompted buying in China-focused stocks, even as investors remained wary of the epidemic’s economic impact.
UK's benchmark FTSE 100 closed up by 3.34 percent, Germany's Dax ended up by 4.01 percent, France’s CAC finished the day up by 3.94 percent.
The Dow Jones Industrials fell more than 800 points and the S&P 500 as well as the Nasdaq hit three-week lows on Monday as a surge in coronavirus cases outside China fueled global growth worries and pushed investors to safer assets.
Dow Jones closed down by 0.56 percent, S&P 500 ended up by 3.35 percent, Nasdaq finished the day down by 3.71 percent.
Treasuries Recap
The U.S. 10-year Treasury yield fell to its lowest level since 2016 on Monday as the spread of coronavirus over the weekend rattled world markets, already on edge about the economic damage caused by the outbreak.
The 30-year Treasury yield touched a new record low at 1.873% and was last down 4 bps on the day.
Commodities Recap
Oil prices slumped by 5% on Monday as the rapid spread of the coronavirus in countries outside China added to investor concerns over the effect on demand for crude.
Brent crude futures fell $2.96, or 5.1%, to $55.54 a barrel. U.S. West Texas Intermediate (WTI) crude futures dropped by $2.58, or 4.8%, to $50.80 a barrel.
Gold soared as much as 2.8% on Monday to its highest level in seven years, as investors worried about global economic growth in the face of sharply rising coronavirus cases outside China.
Spot gold climbed 2.1% at $1,677.24 per ounce by 10:38 a.m. EST (1538 GMT). The session high, $1,688.66, was its highest since January 2013. U.S. gold futures for April delivery rose 1.9 % to $1,680.20 per ounce.
