Market Roundup
- Oil drops on fuel demand concerns
- Gold steady on second wave fears
Economic Data Ahead
- (0400 ET/0800 GMT) Italy Consumer Price Index (YoY)(May)
- (0400 ET/0800 GMT) Italy Consumer Price Index (EU Norm) (MoM)(May)
- (0400 ET/0800 GMT) Italy Consumer Price Index (MoM)(May)
- (0400 ET/0800 GMT) Italy Consumer Price Index (EU Norm) (YoY)(May)
- (0500 ET/0900 GMT) EZ Trade Balance n.s.a.(Apr)
- (0500 ET/0900 GMT) EZ Trade Balance s.a.(Apr)
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index rallied, as risk sentiment weakened after Beijing recorded dozens of new COVID-19 cases in recent days. According to a Reuters tally, worldwide coronavirus cases have crossed 7.86 million with 430,501 deaths. The greenback against a basket of currencies traded 0.2 percent up at 97.29, having touched a low of 95.72 on Wednesday, its lowest since March 10.
EUR/USD: The euro declined, extending losses for the third straight session, as the greenback surged against a basket of currencies amid fears of a second wave of the coronavirus in Beijing. The European currency traded 0.1 percent down at 1.1241, having touched a low of 1.1212 on Friday, its lowest since June 4. Investors’ attention will remain on a series of data from Eurozone economies and EZ trade balance, ahead of U.S. NY Empire State Manufacturing Index. Immediate resistance is located at 1.1282, a break above targets 1.1311 (5-DMA). On the downside, support is seen at 1.1194, a break below could drag it below 1.1169.
USD/JPY: The dollar tumbled, reversing some of its previous session gains, as fears of a second wave of the coronavirus in Beijing cut investors’ appetite for riskier assets. Beijing had gone for almost two months with very few infections until a new case was reported on June 12, while several U.S. states also reported a record increase in new coronavirus cases and hospitalizations. The major was trading 0.2 percent down at 107.17, having hit a low of 106.57 on Thursday, its lowest since May 11. Investors’ will continue to track the broad-based market sentiment, ahead of U.S. NY Empire State Manufacturing Index. Immediate resistance is located at 107.82 (21-DMA), a break above targets 108.13 (10-DMA). On the downside, support is seen at 106.74, a break below could take it near at 106.35.
GBP/USD: Sterling plunged to a 2-week low on concerns that trade negotiations between Britain and the European Union were not making enough progress. The selling pressure around the British pound intensified on Friday after a report that British officials told their EU counterparts they will not extend the deadline for trade talks beyond the end of this year. The major traded 0.6 percent down at 1.2464, having hit a low of 1.2454 earlier, it’s lowest since June 1. Investors’ attention will remain on the geopolitical developments ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2575, a break above could take it near 1.2633. On the downside, support is seen at 1.2418 (21-DMA), a break below targets 1.2403. Against the euro, the pound was trading 0.2 percent down at 89.82 pence, having hit a low of 90.14 on Thursday, it’s highest since June 1.
AUD/USD: The Australian dollar slumped to a 2-week trough after data showed Chinese industrial production and retail sales missed economists estimates in May. Meanwhile, renewed outbreaks of the virus further dented investor sentiment. The major trades 1.1 percent down at 0.6792, having hit a low of 0.6791 earlier, it’s lowest since June 1. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.6894, a break above could take it near 0.6940 (5-DMA). On the downside, support is seen at 0.6783, a break below targets 0.6699.
Equities Recap
Asian shares plunged as fears of a second wave of coronavirus infections in Beijing sent investors seeking safety in safe-haven assets.
MSCI's broadest index of Asia-Pacific shares outside Japan tumbled 0.3 percent.
Tokyo's Nikkei fell 3.5 percent to 21,530.95 points, Australia's S&P/ASX 200 index declined 2.2 percent to 5,719.80 points. South Korea's KOSPI slumped 3.9 percent to 2,048.15 points.
Shanghai composite index eased 0.6 percent to 2,902.83 points, while CSI 300 index traded 0.8 percent down at 3,973.97 points.
Hong Kong’s Hang Seng traded 2.1 percent lower at 23,787.94 points. Taiwan shares shed 1.1 percent to 11,306.26 points.
Commodities Recap
Crude oil prices fell more than 4 percent as new coronavirus infections hit China and the United States, raising the prospect that renewed outbreaks of the virus could weigh on the recovery of fuel demand. International benchmark Brent crude was trading 4.1 percent lower at $37.28 per barrel by 0546 GMT, having hit a low of $36.98 on Friday, its lowest since May 29. U.S. West Texas Intermediate was trading 5.4 percent down at $34.55 a barrel, after falling as low as $34.53 earlier, its lowest since June 1.
Gold prices declined after posting their best week since early April on fears of a second wave of coronavirus infections in Beijing. Spot gold was trading 0.2 percent down at $1,726.66 per ounce as of 0548 GMT, having touched a high of $1,744.91 on Thursday, its highest since June 2 and gained 2.6 percent last week, its biggest weekly gain since April 10. U.S. gold futures eased 0.1 percent to $1,734.90.
Treasuries Recap
On Friday, the two-year U.S. Treasury yield was up 1 basis point at 0.189 percent, while the benchmark 10-year yield was up 3.9 basis points at 0.6919 percent.
