Market Roundup
- Oil drops on oversupply after OPEC+ delays meeting
- Gold firms on safe-haven demand
- Sterling falls after PM Johnson hospitalised over persistent coronavirus symptoms
Economic Data Ahead
- (0430 ET/0830 GMT) UK Markit Construction PMI (Mar)
- (0430 ET/0830 GMT) EZ Sentix Investor Confidence (Apr)
Key Events Ahead
- No Significant Events Scheduled
FX Beat
DXY: The dollar index held firm near a 1-1/2 week peak, amid worries about the spread of the virus and its impact on the economy. Data last week showed companies in the United States shed jobs as the COVID-19 pandemic leads the global economy into a deep recession. The greenback against a basket of currencies traded flat at 100.64, having touched a high of 100.85 earlier, its highest since Mar. 26.
EUR/USD: The euro rose, halting a 4-day losing streak after officials stated that Eurozone finance ministers are likely to converge on Tuesday on three quick options to support the economy in the wake of the coronavirus epidemic. The European currency traded 0.1 percent up at 1.0815, having touched a low of 1.0772 on Friday, its lowest since March 25. Investors’ attention will remain on a series of data from the Eurozone economies, and EZ Sentix investor confidence, amid a lack of economic data from the U.S. docket. Immediate resistance is located at 1.0854, a break above targets 1.0889. On the downside, support is seen at 1.0760, a break below could drag it below 1.0720.
USD/JPY: The dollar surged to an over 1-week after a top official at the U.S. Federal Reserve on Sunday stated that the $2.3 trillion economic relief bill approved by Congress was appropriately sized and that a further relief effort may not be needed if support efforts are well executed. The yen further weakened after Japanese media reported Prime Minister Shinzo Abe may declare a state of emergency as early as Tuesday to curb an alarming acceleration in coronavirus infections. The major was trading 0.6 percent up at 109.03, having hit a low of 107.12 last week, its lowest since Mar. 18. Investors’ will continue to track the broad-based market sentiment, as U.S. economic calendar remains absolutely data empty. Immediate resistance is located at 109.49, a break above targets 109.71. On the downside, support is seen at 107.77 (21-DMA), a break below could take it near at 107.12.
GBP/USD: Sterling slumped after British Prime Minister Boris Johnson was admitted to hospital for tests after showing persistent symptoms of the coronavirus. The major traded 0.05 percent lower at 1.2210, having hit a low of 1.2205 on Friday, it’s lowest since March 27. Investors’ attention will remain on the geopolitical developments ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2369 (5-DMA), a break above could take it near 1.2472. On the downside, support is seen at 1.2167 (10-DMA), a break below targets 1.2093. Against the euro, the pound was trading 0.2 percent down at 88.19 pence, having hit a high of 87.39 on Friday, it’s highest since Mar. 11.
AUD/USD: The Australian dollar rose after tumbling for four straight sessions as the Reserve Bank of Australia is expected to stand pat on its monetary policy decision due on Tuesday after it announced an emergency rate cut and bond-buying program last month. The Aussie trades 0.6 percent up at 0.6027, having hit a low of 0.5980 on Friday, it’s lowest since Mar. 26.. Immediate resistance is located at 0.6084 (5-DMA), a break above could take it near 0.6117 (21-DMA). On the downside, support is seen at 0.5956, a break below targets 0.5886.
Equities Recap
Asian shares nudged up as investors were encouraged by a slowdown in coronavirus-related deaths and new cases
Tokyo's Nikkei rallied 4.2 percent to 18,576.30 points, Australia's S&P/ASX 200 index surged 4.3 percent to 5,286.80 points and South Korea's KOSPI rose 3.9 percent to 1,791.88 points.
Hong Kong’s Hang Seng traded 2.2 percent lower at 23,740.87 points. Taiwan shares added 1.6 percent to 9,818.74 points.
Commodities Recap
Crude oil prices declined after Saudi-Russian delayed a meeting to discuss output cuts that could partly alleviate oversupply in global markets. International benchmark Brent crude was trading 3.3 percent lower at $33.80 per barrel by 0551 GMT, having hit a high of $36.11 on Thursday, its highest since March 12. U.S. West Texas Intermediate was trading 3.1 percent down at $27.92 a barrel, after rising as high as $29.11 on Friday, its lowest since Mar. 17.
Gold prices edged up on worries over the economic impact from the coronavirus pandemic, although firm dollar and stronger equities capped gains. Spot gold traded 0.1 percent up at $1,620.68 per ounce by 0602 GMT, having touched a low of $1572.82 on Wednesday, its lowest since Mar. 24. U.S. gold futures were steady at $1,645.90.
Treasuries Recap
On Friday, the yield on the benchmark U.S. 10-year note was down 2.3 basis points at 0.6041 percent, while the two-year U.S. Treasury yield, which moves in line with interest rate expectations, was up 1.1 basis points at 0.2308 percent.
