Market Roundup
- Oil eases as stockpiles rise
- Gold off 1-week peak
- Brexit fears weigh on sterling
- Euro rallies following ECB Lagarde's speech
Economic Data Ahead
- No Major Economic Data Releases
Key Events Ahead
- (0450 ET/0850 GMT) ECB's Schnabel speech
- (0800 ET/1200 GMT) ECB's Lane speech
FX Beat
DXY: The dollar index tumbled, as data showed U.S. weekly jobless claims hovered at high levels last week, suggesting a slowing labour market recovery and casting a shadow over hopes for a quick economic rebound. The greenback against a basket of currencies traded 0.1 percent down at 92.97, having touched a high of 93.66 on Wednesday, its highest since August 12.
EUR/USD: The euro rose, hovering towards a 1-week peak recorded in the prior session as the European Central Bank President Christine Lagarde insisted the central bank does not target the exchange rate, indicating the ECB was unlikely to undertake measures to weaken the euro despite its recent gains. The ECB raised its economic outlook for this year, although projections for 2021 and 2022 remained little unchanged. The European currency traded 0.2 percent higher at 1.1834, having touched a high of 1.1917 on Thursday, its highest since September 2. Investors’ attention will remain on a series of data from the Eurozone economies and ECB officials speech, ahead of the U.S. consumer price index, and monthly budget statement. Immediate resistance is located at 1.1870, a break above targets 1.1902. On the downside, support is seen at 1.1790, a break below could drag it below 1.1765.
USD/JPY: The dollar nudged higher as investors awaited the release of U.S. consumer price data due later in the day for further insights into the economy's recovery. However, the upside in the pair appears limited as the U.S. Senate blocked a Republican bill that would have provided around $300 billion in new coronavirus aid, as Democrats pushed for more funding. The major was trading 0.05 percent higher at 106.17, having hit a low of 105.78 Wednesday, its lowest since September 1. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. consumer price index, and monthly budget statement. Immediate resistance is located at 106.40, a break above targets 106.70. On the downside, support is seen at 105.90, a break below could take it near at 105.60.
GBP/USD: Sterling steadied after plunging to a 2-1/2 month low in the prior session on growing fears the UK-EU trade negotiations may fall apart. On Thursday, the European Union told Britain it should urgently scarp a plan to break their divorce treaty. The major traded 0.2 percent up at 1.2823, having hit a low of 1.2773 the day before, it’s lowest since July 24. Investors’ attention will remain on the geopolitical developments, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2880, a break above could take it near 1.2930. On the downside, support is seen at 1.2741, a break below targets 1.2700. Against the euro, the pound was trading 0.05 percent down at 92.29 pence, having hit a low of 92.70 in the previous session, it’s lowest since March 24.
AUD/USD: The Australian dollar gained, reversing most of its previous session losses, as the greenback eased on soft unemployment benefit claims data. The U.S. initial jobless claims totaled a seasonally adjusted 884,000 for the week ended September 5, matching the number of applicants received the prior week. The Aussie trades 0.3 percent up at 0.7279, having hit a high of 0.7280 on Thursday, it’s highest since September 3. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate resistance is located at 0.7310, a break above could take it near 0.7327. On the downside, support is seen at 0.7230, a break below targets 0.7215.
NZD/USD: The New Zealand dollar surged as the U.S. dollar eased as investors awaited the U.S. Consumer Price Index for August, which is expected to show the cost of living rose 0.3 percent month-on-month, following July's 0.6 percent rise. The Kiwi trades 0.2 percent higher at 0.6665, having touched a low of 0.6601 on Wednesday, its lowest level since August 27. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6707 (10-DMA), a break above could take it near 0.6740. On the downside, support is seen at 0.6620, a break below could drag it below 0.6601.
Equities Recap
Asian shares slumped as U.S. tech firm shares plunged overnight on growing doubts about U.S. stimulus.
MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 0.2 percent.
Tokyo's Nikkei surged 0.7 percent to 23,399.91 points, Australia's S&P/ASX 200 index fell 0.7 percent to 5,866.60 points. South Korea's KOSPI declined 0.2 percent to 2,391.11 points.
Shanghai composite index rose 0.5 percent to 3,249.28 points, while CSI 300 index traded 0.6 percent up at 4,609.18 points.
Hong Kong’s Hang Seng traded 0.6 percent higher at 24,461.98 points. Taiwan shares shed 0.1 percent to 12,675.95 points.
Commodities Recap
Crude oil prices steadied after tumbling in the previous session on an unexpected rise in U.S. stockplies as the coronavirus pandemic continued to hurt fuel demand. International benchmark Brent crude was trading 0.3 percent up at $39.88 per barrel by 0439 GMT, having hit a low of $39.29 on Tuesday, its lowest since June 16. U.S. West Texas Intermediate was trading 0.5 percent higher at $37.17 a barrel, after falling as low as $36.15 on Tuesday, its lowest since June 15.
Gold prices declined after rising to a 1-week peak in the prior session but were on track for a weekly gain underpinned by worries over a global economic recovery from the coronavirus-led slump. Spot gold was trading 0.3 percent down at $1,940.62 per ounce by 0456 GMT, having hit a high of $1966.57 on Thursday, its highest since September 2. The safe-haven metal has gained 0.4 percent so far this week. U.S. gold futures fell 0.9 percent to $1,947.75.
Treasuries Recap
The U.S. Treasury yields declined, with the benchmark 10-year note yield trading at 0.682 percent.
