Market Roundup
• Canada Jan RBC Manufacturing PMI 50.6, 49.6 forecast, 50.4 previous
• US Jan Manufacturing PMI 51.9, 51.7 forecast, 52.4 previous
• US Dec Construction Spending (MoM) -0.2%, 0.5% forecast 0.7% previous
• US Jan ISM Manufacturing Employment 46.6, 46.6 forecast, 45.2 previous
• US Jan ISM Manufacturing New Orders Index 52.0 , 47.6 previous
• US Jan ISM Manufacturing PMI 50.9, 48.5 forecast, 47.8 previous
• US Jan ISM Manufacturing Prices 53.3, 50.8 forecast, 51.7 previous
• Brazil Jan Trade Balance -1.75B, 0.10B forecast 5.60B previous
Looking Ahead - Economic Data (GMT)
• 21:45 New Zealand Dec Building Consents (MoM) -8.5% previous
• 23:50 Japan Monetary Base (YoY) 3.2% previous
• 00:00 Australia HIA New Home Sales (MoM) -0.5% previous
• 03:30 Australia Feb RBA Interest Rate Decision 0.75% forecast, 0.75% previous
Looking Ahead - Events, Other Releases (GMT)
• No significant events
Currency Summaries
EUR/USD: The euro declined against the U.S. dollar on Monday, as dollar rebounded after unexpected rebound in U.S. manufacturing boosted greenback. The Institute for Supply Management (ISM) said its index of U.S. factory activity increased to 50.9 last month, the highest level since July, from an upwardly revised 47.8 in December. A reading above 50 indicates expansion in the manufacturing sector, which accounts for 11% of the U.S. economy. The euro was down 0.31 percent at $1.1059 .Immediate resistance can be seen at 1.1073 (9 DMA), an upside break can trigger rise towards 1.1099 (Higher BB).On the downside, immediate support is seen at 1.1041(21 DMA), a break below could take the pair towards 1.10000 (Psychological level).
GBP/USD: British pound declined against dollar on Monday, after British Prime Minister Boris Johnson set out tough terms for EU talks, rekindling fears Britain would reach the end of an 11-month transition period without reaching a trade deal. By 1300 GMT the pound was down 1.2% at $1.3047 in its biggest one-day fall since Dec 17. Against the euro it had lost 0.9% to 84.785 pence.The currency had ended January on a high, with the best weekly gain in a month after the Bank of England kept interest rates steady at 0.75%, surprising some who had expected a 25 basis-point cut. Immediate resistance can be seen at 1.3060 (5DMA), an upside break can trigger rise towards 1.3100 (Psychological level).On the downside, immediate support is seen at 1.2953 (Lower BB), a break below could take the pair towards 1.2900(Psychological level).
USD/CAD: Canadian dollar fell to an eight-week low against its broadly stronger U.S. counterpart on Monday as oil prices fell and domestic data showed that factory activity increased at a sluggish pace in January. The price of oil, one of Canada's major exports, was dragged down by concern that the coronavirus outbreak could reduce demand, though the possibility of deeper output cuts by OPEC and its allies offered some price support. U.S. crude oil futures were down 1.1% at $50.99 a barrel .. Immediate resistance can be seen at 1.3306 (Daily high), an upside break can trigger rise towards 1.3325 (Dec 4th high).On the downside, immediate support is seen at 1.3264 (5 DMA), a break below could take the pair towards 1.3229 (21 DMA).
USD/JPY: The dollar gained against the Japanese yen on Monday as fears that coronavirus epidemic would hit demand in China eased. The death toll in China from the newly identified virus, which emerged in Wuhan, capital of the central province of Hubei, rose to 361 as of Sunday, up 57 from the previous day, the National Health Commission said. The World Health Organization (WHO) last week declared the flu-like virus a global emergency and it has since spread to 23 other countries and regions. It has advised against trade and travel . Strong resistance can be seen at 108.99 (9 DMA), an upside break can trigger rise towards 109.33 (21 DMA).On the downside, immediate support is seen at 108.30 (Daily low), a break below could take the pair towards 108.00 (Psychological level).
Equities Recap
European shares inched up on Monday, recovering from their worst week in nearly seven months as jitters remained over the economic fallout from a virus outbreak in China.
The UK's benchmark FTSE 100 closed up by 0.55 percent, Germany's Dax ended up by 0.49 percent, and France’s CAC finished the up by 0.49 percent.
U.S. stocks climbed on Monday as gains in Amazon and Nike as well as a surprise rebound in U.S. factory activity helped markets attempt a recovery from steep weekly losses due to concerns about the coronavirus epidemic.
Dow Jones closed up by 0.51 percent, S&P 500 ended up 0.73 percent, Nasdaq finished the day up by 1.33 percent.
Treasuries Recap
U.S. Treasury yields pared gains on Monday as traders took stock of the international response to the coronavirus epidemic.
The benchmark 10-year yield was up less than 1 basis point at 1.5238% in afternoon trading, down from 1.575% earlier.
Commodities Recap
Gold fell 1% on Monday as the dollar firmed and investors opted for riskier assets after China took steps to relieve pressure on its economy from the impact of the coronavirus outbreak.
Spot gold dipped more than 1% and was down 0.8% at $1,576.77 per ounce by 01:36 p.m EST (1836 GMT).U.S. gold futures settled 0.3% lower to $1,582.40 per ounce.
Oil prices fell to the lowest in more than a year on Monday, dragged down by concern over demand in China after the coronavirus outbreak, though the possibility of deeper crude output cuts by OPEC and its allies offered some price support.
Brent crude was down $1.82 at $54.80 a barrel by 11:33 a.m. EST (1633 GMT), its lowest since January last year. The first-month Brent contract traded at 10 cents less than the second-month contract, a reversal from the front-month premiums seen as recently as last week. The discount was the largest since July.U.S. West Texas Intermediate (WTI) crude fell $1.16 to $50.40, also the lowest since January 2019.
